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Local Government Pension Scheme LGPS (NI) 2015

The key features of the new Scheme are outlined below:

  • The Scheme will change from a final salary to a career average revalued earnings (CARE) model
  • The pension accrual rate increases from 1/60 to 1/49
  • The annual revaluation rate is linked to the Consumer Price Index
  • The normal pension age for the new CARE scheme is now the same as the member’s state pension age (minimum of age 65) meaning that it will be different for everyone
  • The pay bands for member contributions are now based on actual earnings rather than the whole-time equivalent pensionable pay.  Therefore a part-time member who earns £15,000 per year will pay 5.8% whereas in the 2009 Scheme this would be scaled up to what they would earn if they worked full-time - £30,000 and they would pay 6.5%.  A person earning less than £43,401 should not pay any increased contributions.  The new pay bands for 2017/18 are:
  •  Pensionable Pay

    Contribution Rate

    £0 - £14,100
    £14,101 - £21,500
    £21,501 - £35,900
    £35,901 - £43,400 6.8%
    £43,401 - £85,800 8.5% 
    More than £85,800 10.5%

  • Members must now have two years membership to be eligible for a pension rather than three months as at present.  Refunds will be available for those leaving the Scheme with less than two years membership.  There will be transitional provisions to cover the changeover period.
  • The amount of additional pension that an employer can award to an active member is increased to £6,644.  This limit will then increase each year in line with pension increase orders.
  • The exchange of annual pension for lump sum rate remains at 12:1 i.e. £12 of lump sum for every £1 of pension given up
  • There are no changes to survivors’ benefits
  • Ill-health benefits continue to be a two tier system
  • There will be no changes to how AVCs will operate in the new Scheme.  This means that you can take up to 100% of your AVC fund as a tax-free lump sum at retirement (subject to tax limits) and AVC contributions will continue to be restricted to 50% of your pensionable pay.

    To view the regulations visit our Document Library