Pension Question

[Jambo Jet]

This has probably been asked before. If so I'm sorry.

I'm confused with the literature.

Sqn Ldr retires at 44 yr exit point. Gets immediate pension and lump sum .

Flt Lt aircrew asymmilated on to PA spine this year age 38, wants to leave at 44 (PVR). Immediate pension or no pension until 55 yrs?:confused:

[rej]

JJ
My understanding is that once you have done 16 years post age 21 you are eligible for a pension. If you decide to escape prior to your NRD then your pension and gratuity are slightly reduced.

Once upon a time someone told me that the loss of money due to PVR equates to roughly 2 years in the rank so leaving at 44 (23 years)would mean your income is roughly what it would be had you served for 21 years. Not sure if it is an exact science but its seems to be close enough for government work.

Just out of interest when I got promoted at age 37-and-a-bit they gave me an additional exit point of 41 in addition to the normal 44. I'd never heard of that before. Has it happened to anyone else out there or are they just trying to encourage me to go?

[5206]

Normal (or what passes for normal I believe) is that on promotion, if less than 3 years to your 38/16 then you will get your 38/16 option deferred until your 3 year seniority point. That's what happened to me.

[Background Noise]

As I understand it, that is the current sitch - whatever terms of service, if you leave after your 38 point you get your pension straight away. (PA will only get extra PA pension after 5 years as PA). Under the NEW pension scheme soon to come in, and its voluntary to switch or not, if you leave any time before age 55 you get nothing until age 60, if you leave at 55 you get it straight away.

[Jambo Jet]

Thanks for the info

Guys

JJ

[Biggus]

BN

Like a lot of people you are talking b*@locks about the new pension scheme. There are enough details on MoD websites, I suggest you read them.

However, to scotch a few rumours I will attempt to summarise. Yes, under the new scheme you don't get a 'pension' if you leave before 55, because you are not allowed to have one!! However, you get what are called 'Early Departure Payments' from the day you leave, which look exactly like a pension - funny old thing (PROVIDED YOU HAVE SERVED THE MINIMUM TIME TO EARN A PENSION IN THE FIRST PLACE (18 years?), which is actually true of the old system as well. Under the old system if you had not served long enough you only got a 'preserved pension' which you didn't get for years either!) You also get a gratuity, funny old thing, the day you leave. When you get to 55 you start being paid a 'pension' as such, and when you get to 65 you get another gratuity. The amounts under the old and new schemes are not directly comparable, you will have to make your own decisions. The new pension pays system pays you more in the long term, especially if you stay till 55, and live beyond 65. It is possibly less advantageous if you leave early, but you still get a 'form' of pension from day 1 of leaving if you have earned it. It all depends on your individual life circumstances - you need to do your research (10 minutes with a calculator will do!!) or wait till you get the official package!

The new pension is not necessarily a bad deal!!

[JessTheDog]

However, you get what are called 'Early Departure Payments' from the day you leave, which look exactly like a pension

It doesn't look exactly like a pension in the eyes of the Treasury and in the eyes of the recipient, who will receive about a third of the value of the old immediate pension.

Funny old thing, the government exepted the judiciary from the Treasury requirements but not the Armed Forces. Something to do with the judges threatening to resign en masse....

The new pension is a good deal for those who notch up 35 years of service and a poor deal for the majority who leave at the new 18 years point.

[Biggus]

JtD

Fine, and for those that leave at 22, 26, 28, 30............year points.??

I have no intention of getting into a p@ssing contest over this. As I said it is down to each individual to do their own research. I was trying to get beyond rumour.

I said that the new pension is not necessarily a bad deal, by implication I also meant it is not necessarily a good deal either!! Opting in or out is a choice some of us, including myself, will have to make in the near future, and everyone in that position needs to do their homework and decide on their own future plans, aspirations, needs etc.

Nuff said!

[JessTheDog]

Are there any tables for the new scheme yet?

With the old scheme you could work out your pension quite easily. based on rank and years of service, using the spreadsheet table.

[DP Harvey]

Jess, and others,
I'm surprised that you do not already know the answer to your question. I do accept that you could have been out of area, but the basic info you require has been available to you on the www, even at a paradigm terminal in Basrah, for a long time now.

In the new scheme, your pension will be one 70th of your highest salary (basic pay) in your last 3 years service, multiplied by the number of years you have been in the armed forces. It is not rank-based so there cannot be any tables. You will receive that pension immediately on leaving, plus 3 times that amount as a terminal grant, provided that you are aged 55 at that time, otherwise you will have wait until you are 65. I haven't seen any formulae for the Early Depature Payments, which are expected to be the normal post-service scheme, for those leaving before age 55, but I guess that they will be dependant on pay and time served, but I doubt that it is the 70th x number of years, though I might be wrong.

[AllTrimDoubt]

Does anyone have a link to pensions under the FTC(A) scheme?

[Always_broken_in_wilts]

I just love it!!:ok: Courtesy of PA spine and the new pension scheme this baldrick can now retire to the sun at 55........somedays I love this job:ok: :ok: :ok:

all spelling mistakes are "df" alcohol induced

[Lockstock]

EDP details:

http://www.mod.uk/issues/pensions/new_afps/edps.htm

[Scotch Bonnet]

I have heard a trumour that senior army officers are not happy with riff raff aircrew receiving a Lt Cols pension via PES (A) on the new scheme, it probably is true but can they do anything about it?

[L J R]

Has anyone actually seen figures of the OLD pension scheme applicable to the NEW PAS??

.
I have looked, but either must be blind or cannot find details that relate to my particular circumstance


:eek:

[Banggearo]

LJR went through all this before I took PAS 12 months ago, seem to remember that I had to ring the pensions people at Innsworth to get the answer. Basically under the old/current scheme as PAS you get the basic Flt Lt (assuming you are, rather than Sqn Ldr) pension which at 55 is approx £22000 and then you are paid a daily supplement from when you joined the PAS (which for most is 38) until your retirement. Supplement was 64.7p per day but not sure what it is now, equates to approx £4000 top up to your pension so total is approx £26k at 55 which at the time was only £2k less than Wg Cdr. Now these figures are 1-2 yrs old but should give you and idea, hope it helps

BG

[Scotch Bonnet]

There is no confusion over the current/old PES (A) pension its clear as stated. There is confusion over the new scheme. Does your daily PES (A) rate count completely when you calculate your new pension, or is there some kind of get out clause for the beanies. On the face of it the new scheme takes your daily rate (best over the last three years blah blah) and calculates your pension on that...any thoughts?

[WorkingHard]

"basic Flt Lt (assuming you are, rather than Sqn Ldr) pension which at 55 is approx £22000"
On a different thread it was stated (rightly or wrongly) that your pay is "reduced" to allow for the non contributory pension scheme. Have you any idea what investment would be needed to provide such a pension at age 55? Don't anyone complain about service pay if that is really the case. Just as an example, to provide a pension at age 60 (for a male) of £22000 p.a. with the pension ceasing at death (i.e. nothing for surviving wife) I am lead to believe would need an investment fund of something in the order of £350000 and then that would be a fixed pension without any inflation increases. Any actuaries out there care to cost it at 55 and inflation proofed?

[JessTheDog]

I've heard half a million from PMA for the average officer...but we damn well deserve it! Those MP swine get far more and the old police pension of half pay after 30 years is also more generous. Every cloud has its silver lining and every rose has its thorn, the grass is always greener etc..

[DP Harvey]

SB,
A Sqn Ldr colleague of mine on the PA spine, due to leave the RAF in Jun 06 at age 55, has checked out your very question. Yes, the whole of the PA spine salary is counted as pensionable earnings. He is scheduled to receive £30K per annum for life, plus £90K lump sum

[Sloppy Link]

Scotch B,
You are quite correct, a WO1 or WO2 on PES(A) is better off than a Major and a Major on PES(A) is better off than a full Colonel. I could baffle you with the maths....actually I was baffled but the final figures can not lie. They are spitting feathers at the apparant oversight of someoone being better off than them. There are some hoops that have to be jumped through for the WO's to proff and the cynic in me will watch the with interest if they are allowed to complete their final tranche of LSL(A) to qualify. I hope they do as the little earner I (and others) was hoping for was cruelly and vindictively taken from me by the very people who are supposed to look after my interests. LE commission post 22 years service in the ranks, the PES(A) door is closed. Stay in the ranks on LSL(A) and the PES(A) door is open. LE is better off up to a point at about 52 years then the LSL(A) man proffs. Bu**er.

[ANAPROP]

Comparing the old and new pension schemes is complicated, but the decision isn't. If you are absolutely certain that you will serve to age 55 then go for the new scheme. If you know you won’t, or are uncertain, then stick with the old. At least that’s my take on it. Do your research and let me know if you agree or otherwise-;)

[Scotch Bonnet]

I have just lifted this from the FAQs on the MOD website,

Will those on enhanced pay spines, ie medical/dental officers and Professional Aviators, receive a pension based on their individual pensionable pay rate?

Yes. All pensionable pay will be used when calculating the final pensionable salary. It is only Additional Pay, such as flying pay, submarine pay etc, which is not pensionable and is not therefore included.

Nice!

[WorkingHard]

JessThe Dog - I made no comment about "worth", no doubt there are those that are and those that are not, same as every walk of life. What I was referring to was that some bleat on about how poor the pay and conditions are etc. and that it is a "contributory" pension scheme etc etc. It is clearly a very generous package when one costs the pension quoted for the same terms and RPI inflation the fund required is £750,000 according to some actuarial tables. Very few would be able to achieve such a fund without MASSIVE personal contributions. Assuming equal over say 30 years that is £25000 per annum. Does anyone still wish to complain about poor pay when pension contribution is about the same as the annual salary?

[k1rb5]

Changing the topic slightly. Does anyone know the impact of redundancy on the new pension scheme? As a FE the prospect of another 20 years in my job is in the balance. Should I sign on to the new pension scheme (where it appears it's only beneficial to do so if you are going to stay to 55) and get made redundant would they treat the years I WOULD have served as pensionable or would I be shafted???

[DP Harvey]

Mate,
If you opt for the new pension and then become redundant in the existing program, you will have the right to revert to the old scheme upon exit, thus getting an immediate pension if you had completed the standard 22 yrs.

Interestingly, discussions are happening now in the Pay and Pensions Policy dept, about how redundancies beyond the existing program will effect personnel who accepted the new pension in Apr 06. As an FE you are right to be concerned that you might be royally shafted in the future when you are no longer required to fly.

Its my own belief that anyone who accepts the new pension who is signed on to age 55 at the time of transfer will be protected. Giving individuals the right to revert now, while a known redundancy scheme is in operation, sets the precedent for any unknown future scheme to do the same.

[Ginseng]

Information so far is that if you chose to trnasfer, but were then made redundant later, you would be allowed to revert to the current scheme prior to redundancy if it would be to your advantage. I will presume this refers only to compulsory redundancy notified after your intitial election to transfer, until I see it categorically stated otherwise. Hope that helps.

Ginseng

D**n, DPH got there first!

It is still worth saying once again that all the certain information published so far should be read as applying only to new entrants from 1 Apr 05. What transfer terms will be offered to the rest of us from 1 Apr 06 we still have to see. Count your chickens if you will, but write the answer in pencil and keep a rubber (eraser!) handy.

Who called me a cynical old b*****d?!