Are there any charges or penalties
There is no charge or penalty for transferring out of the scheme. Where a request is for transfer to a scheme where GMP or protected rights cannot be accepted it is possible to transfer only the non protected rights. It is also possible to transfer all rights to such a scheme provided the transferring member is aware of the rights being given up.
Can members transfer to another scheme?
Members have the right to transfer their accrued LGPS benefits to another scheme including a scheme that offers flexible benefits. However, if the total value of their LGPS benefits in Scotland is £30,000 or more then they are required to take independent advice (but not for AVCs), from an authorised independent adviser who is registered with the Financial Conduct Authority (FCA).
If the total value of their LGPS benefits is £30,000 or less (or in respect of a transfer of AVCs), we recommend that members seek independent financial advice before deciding to transfer his/her LGPS pension benefits.
Our discharge paperwork can be found in the Transfer Information and also Publications >Members > Forms area of our website.
Pension Increase and Revaluation
Pensions from the final salary part of the scheme when in payment or in deferment are revalued yearly by CPI and cannot fall below zero. The CARE part of the pension is revalued yearly by Treasury Orders.
Where the Treasury Order revaluation is below zero a negative revaluation will be applied to current members' pension accounts accrued that year and to those of any member who left within the year that negative revaluation applies to. Pensions in payment or which are deferred are not devalued but will have no increase.
As we do not know future revaluation and pensions increase rates the Fund will not provide projections beyond the current year.
The amount of contributions payable by a member is determined by the Regulation 9 of the LGPS (Scotland) 2018 Regulations. Members pay a percentage of their pay based on their pensionable earnings. Employers' contributions are not based on individual member's contributions but are determined by the scheme actuary following the triennial scheme valuation. The latest scheme valuation showing how much each employer pays can be found on the reports section of our website. We will not provide a breakdown of the contributions paid by a member or employer as the contributions merely fund the scheme and are not used to calculate any benefits payable.
Is there a lump sum paid when the pension is due?
The scheme regulations allow the member to give up pension to provide a tax free lump sum at retirement at the rate of £1 of pension for an additional £12 of lump sum. The scheme allows a member to take up to 25% of the capital value of their accrued rights as tax free cash. Please see Regulation 32 of the LGPS (Scotland) 2018.
The method for calculating the maximum lump sum available is:
Pension* x 120 / 7 = X
Lump sum** x 10 / 7 = Y
X + Y / 4 = Maximum lump sum
*after early retirement reductions have been applied
**after early retirement reductions have been applied and including any AVC
Are there any discretionary increases?
There are no discretionary increases either in deferment or in payment.
What is the definition of a spouse?
In the event of a member's death, pensions are payable to eligible partners. Eligibility depends on the regulations in force at the time the member left the scheme.
If the member left the scheme after 31 March 2009 a partner is a legally married husband or wife (including same sex spouse), a civil partner or cohabiting partner.
If the member left between 1 April 1998 and 31 March 2009 a partner is a legally married husband or wife, or a civil partner
If the member left before 1 April 1998 a spouse is an opposite sex, legally married husband or wife.
Does the scheme offer a bridging pension?
We do not offer bridging pensions.
Do you provide retirement quotations?
We do not provide bespoke calculations for the purpose of offering financial advice. Each year we issue our annual Pension Update statement to our members. This details retirement and death benefits. This should be obtained directly from your client.
Our transfer calculation document details the pension, lump sum and spouses benefits as at the date of exiting the scheme (or the relevant date of the calculation if the transfer quotation relates to active membership of the pension scheme). The pensions increase factor applicable for deferred members of the scheme is also shown on the calculation. Details of any actuarial reductions to be applied for early payment can be found in our Guide to the LGPS and also on the LGPS Regulations and Guidance section of the LGPS 2015 website.
Members can also perform calculations and access their record via our SPFOnline service. SPFOnline is available to active, deferred and pensioner members. If your client is not already registered for SPFOnline then the sign up page can be accessed here.
Do you provide recalculations of transfer quotations?
We only provide one transfer quotation in any one year period. If we have provided transfer details within the last 12 months we will not provide a revised quotation.
What is the Scheme funding position?
You can find information on the Funding of the scheme and our Actuarial valuation in our Reports section.