FAFPS 2015

[Corporal Clott]

There's a briefing team doing the rounds on the new Future Armed Forces Pension Scheme (FAFPS), here's what I heard the other day. Feel free to add what you hear:

1. Those with 10years or less to serve will get protected rights to their old pension - also it will be for the rank they retire at and not the rank they hold at the 2015 point. (After thought was that there is a chance that staying on the old schemes might actually be a worse deal? Some bright spark thought that one up!)

2. Others will have to transfer after 1 April 2015 (note underline) and will have protected rights to their pension that will pay at the rank that they retire at in the future but at the frozen yearly accrual rate at 2015. The rest of their service will acquire a FAFPS pension. (Again, there is a chance that this pension may prove a better deal than staying on the old schemes for some individuals?)

3. Currently no idea of what FAFPS will pay but it will be non-contributary and also will remain competitive with other public sector schemes. It will be career averaging and those that promote faster will get a bigger pension even if they retire on the same rank as someone who has promoted slower.

4. Specialist Pay unlikely to be included.

5. There will be station based "focus groups" and surveys to complete for the consultancy period - no firm decision on FAFPS has been made on how it will work.

6. EDPs or IPs are likely to be paid later as people marry later, have children later and buy houses later (?!?).

7. No expectation that lump sums will be taxed in the future (they realise how massively it would affect retention).

8. New Employment Model (NEM) needs to tie in with FAFPS, so having it ready to roll out in 2015 is a very big ask!

That's all I learned but I'm sure others will take in bits that I missed. Please post what you learn so that we can all benefit from combined wisdom.

CPL Clott

["Running in"]

Interesting and appreciated post. Regarding SP, I wonder how that will affect PAS, FTCA? These schemes factor in SP as part of the pension so will they survive 1st contact??

[Equilibrium]

Good gen and TY

Don't believe that PAS is considered as SP.

Standing by to be corrected as always. :8

[Scuttled]

Thank you very much for the insight.

Any other info (or rumours) much appreciated from this isolated call sign. I'm sure others out of the loop feel the same

[Corporal Clott]

More info here and also it backs up my recollections. The online survey will also link from this site...Ministry of Defence | About Defence | What we do | Personnel | Armed Forces Pensions Compensation and Veterans | Find out about The Future Armed Forces Pension Scheme (http://www.mod.uk/DefenceInternet/AboutDefence/WhatWeDo/Personnel/Pensions/FindOutAboutTheFutureArmedForcesPensionScheme.htm)

Clott

[Bob Viking]

A helpful and informative post and, even more incredible, nobody has started bitching yet. I must have come to the wrong place.
Long may it last.
BV:ok:

[ericthered7]

Question for anyone with more information re protected rights with 10 years or less to serve.

Is this 10 years or less to full pension point, i.e age 55 or is it less than ten years left on your current pensionable engagement exit point, i.e 16/18 year point etc if you choose to leave then and not extend your service.

Many thanks.

[Melchett01]

I realise there is probably a clue in the title 'career average', but are there any indications yet if the career average element for those of us potentially stradling both schemes is an average going forward from the point of transition or if will be applied to our earlier service which should be covered under the accrued rights part? If the former, that will be one thing, if the latter I can see some eagle-eyed been counter making a bid to remove our accrued rights protection on the grounds that our earlier service would effectively be covered by 2 schemes simultaneously.

[High_Expect]

Agreed. But they've already announced that it's protected with less than 10 years to serve. So career average from 2015 = already top level Flt Lt = final salary pension?!? Albeit I might not get the last couple of years immediately.

[Climebear]

ericthered7

It's 10 years until your full pension point wef 1 Apr 12 - so those 45 or older on 1 Apr 12 would not be affected.

Details published in 2012DIN01-063 - available on the intranet.

[Voxpop]

We will not know for certain that PAS will not be treated as SP until the consultation document comes out - but I would be surprised if it was. PAS was introduced for a specific reason and that reason is still valid.

Watch out for the consultation document and keep an eye on our website (www.forpen.co.uk (http://www.forpen.co.uk)).

[Reverend 71]

Melchett,

Under FAFPS, your pension will be based on your career average from the date the scheme is introduced (from Apr 15). As you say, past service is covered by your accrued rights. It will only be those who join the Services from Apr 15 and build up only a FAFPS pension who will really be on a 'Career Average'. As for PAS, it is not SP therefore PAS pensions under FAFPS will be based on pensionable pay.

Rev

[Al R]

I realise there is probably a clue in the title 'career average', but are there any indications yet if the career average element for those of us potentially stradling both schemes is an average going forward from the point of transition or if will be applied to our earlier service which should be covered under the accrued rights part? If the former, that will be one thing, if the latter I can see some eagle-eyed been counter making a bid to remove our accrued rights protection on the grounds that our earlier service would effectively be covered by 2 schemes simultaneously.


Melchett;

Devil, detail? The DIN wording which is important is; "Accrued rights will be linked to final salary on exit from the Armed Forces, not the salary at the point of transition.". However, anyone on '75 who anticipates a promotion just a year or so before the date of transition may well still be waiting to see how he/she 'straddles'!

[The English Passenger]

Al R,

So if I get your interpretation correct, it may well be that those of us who are lucky enough to be PAS will get an accrued rights 75 pension based based on our final salary ( level 30 for Flt Lts like myself), plus a career average salary from 2015 to age 55 based on a very healthy average over those years under the new scheme. So it might not turn out to be too bad after all. It will prob be very slightly less over all as the FAFPS average will be less than a final salary one, but not by a significant amount?

[Jambo Jet]

I heard that index linking will happen from 65 rather than 55 as it is now

[VinRouge]

Depends when you draw the pension. I would recommend that many on here go and READ THE DIN! It has a handy flow table that covers indexation, then you get your pension vs IPP...

Download it off defence intranet, search DIN, within 3 clicks you can find out all about it.

[Greenielynxpilot]

There are at least two factors to think about when assessing the value of your pension: The size of the overall cake, and the size of your slice.


Each year of service gives you a slightly bigger slice. Under AFPS75 this is capped at a maximum of 48.5%
Each promotion increases the size of the overall cake.
Each AFPRB pay award also increase the size of the cake (well - lets call it sprinkles on the icing).


As I read the DIN - someone who has accrued an X% sized slice of cake under AFPS75/05 as at 1 Apr 2015 will maintain that sized slice of any bigger cake, should they promote after 1 Apr 2015. And of course, all cakes are likely to grow a little with each future pay award ;)

Service post-1 Apr 2015 will start to earn slices of a second cake, which has no fruit or nuts, and no jam or butter cream filling. The recipe for this cake is based on career average earnings - but in the first year of service under the new scheme you will only have earned a 1.11% sized slice of this cake (or whatever accrual rate is eventually agreed upon).

The point is that this later period of service will no longer lead to bigger slices of the former, tastier cake - so there is absolutely no chance at all that anyone will be better off, unless the new pension is more generous than the one it replaces ... which it won't be.

[Lima Juliet]

Greenielynxpilot

"no chance of anyone being better off"

The spec aircrew guys who went PAS and that transfered from AFPS75 to AFPS05 in 2006 would probably disagree with that - they went from a pension between a Flt Lt and a Sqn Ldr to a Wg Cdr's pension (about £8-9k a year difference!!!). Now how do I raise my rose-tinted visor? :ok:

From my perspective I could end up with an AFPS75 pension (that's in payment), an RFPS05 pension until 1 Apr 15 and then a FAFPS pension after that - 3 pensions for the work of one!!! I wonder if I'll get 3 lump sums as well? :E

LJ

[Al R]

English Pax,

That would be my understanding, yes, subject to a raft of caveats of course and final confirmation when the scheme is revealed. Will it benefit you on PAS? Possibly. Career average (CARE) schemes tend to favour those who pay grades have peaked or which remain largely, unchanged - whereas a Final Salary scheme will favour those who get a great promotion towards the end of a career.

Bear in mind that its not just about the Accrual- it also depends on what the Revaluation rate is going to be. For some (those who have been receiving low-ish pay rises), the revaluation rate can be worth more than the accrual rate (it could be RPI/CPI + 1% for instance) because what you earned 30 years before is still hammered by inflation.

My point was more about those who may be promoted 1 year (under '75) before April 2015 and have therefore yet to nail 2 years pensionable service in rank.

[downsizer]

What worries me most is what point the '15 scheme will start paying out a pension, particularly if you leave before 55-60. I fear that an IP under '15 is gone.

[Corporal Clott]

Downsizer

This is exactly what the consultation period is about; trying to find where to put an IP/EDP. As I understood it, there has been no decision yet about where that point may be, but what they did say was that this point might be later than it is currently - say 22/42 or 30/50 or something like that rather than 18/40 as it is for AFPS05.

I hope that helps?

Clott

[Reverend 71]

As Cpl Clott said there will be an EDP point on the new scheme it just hasn't been decided when it will be. Given that much of the new scheme's framework has been set down by Lord Hutton, there still remain some discretionary elements that the MoD can influence and one is where the EDP should be. This is one of the things that the FAFPS Team will be consulting on. The options they are looking at are 20/42; 21/43; 23/45. The 30/50 point is not being considered in the Consultation Exercise. The briefs that are being delivered at the moment are some kind of preliminary to the formal Consultation Exercise which will start once the Consultation Document and an online survey have been released which should be sometime this month. No doubt there will be a big Internal Comms push on it.

With regards the new Normal Pension Age of 60, if your TCOS mean that you can only serve to 55, then you would be able to draw your FAFPS pension at age 55, but at an actuarially reduced rate, along with your protected AFPS 75/05 pension. The change of TCOS to allow service to 60 is not in the gift of the FAFPS Team, but is, I believe, being looked at by the NEM Team.

Rev

[Corporal Clott]

Reverend

You speak wise words, sir. That is exactly how I understand it as well. The Navy type that briefed us said "Hand on heart, no decision on what the future pension will exactly look like has been made" (or something along those lines). He went on to tell us that this is what the consultation is about and the "focus groups" would inform the variables that they are allowed to change within the new scheme.

NEM is also an area that is wide open. I know that TACOS changes are likely just like the FTRS guys who were recently told they could work to 65 (vice 60) as long as they're fit and healthy and their commitments are renewed. I know they also have issues with FTRS and AFPS05 - I would expect this to be fixed as reccomendation of the recent future reserves study. As it stands at present, most are FTRS75 pension earners as I understand it.

I'm optimistic that things won't be as bad as some would have us believe; but it doesn't stop some of the backstabbing wackners that get promoted as part of the Exec Stream (or whatever it's called).

CPL Clott

[FJ2ME]

So, if they're going to move the EDP/IP to say, 22/42, where does that leave those of us on AFPS75? Does that mean we have effectively been extended until 22/42 from 16/38? Surely a 6/4 year extension is such a radical change to people's terms that they can't force that upon us?... Or is this yet another redundancy by stealth method in order to get people to leave without paying them a bean...I despair I really do.

[Melchett01]

Or is this yet another redundancy by stealth method in order to get people to leave without paying them a bean...I despair I really do.

If that is their thinking, then it's flawed. Because anyone on AFPS 75 who is already past their IP point and feels like they are about to be done over will just leave before the new scheme comes in to play, and the MOD will then have to start paying out. Hardly a good way of saving money - and given the numbers of people I know who are keeping a very close eye on things and are prepared to jump in 2014 - it will cost them a fortune. If they really want to save money in the short term the smart thing would be to cause as little damage as possible and encourage people to stay thus catching them in any new scheme.

[Hueymeister]

Well, I'll be on my bike if they monkey with my pension to make my PAS Pension worse post 2015:=:ugh::mad:

[Lima Juliet]

FJ2ME

If you're on a PC on AFPS75 or 05 your exit dates will stand, however if you're SSC and switching to PC after 2015 then they will probably insist on a new exit date. For an OR then I'm not so sure as they may link it to promotion - which is not unusual for officers either as I had to waive my 22/44 point on AFPS75 when promoted after my 41st birthday.

Also, as Cpl Clott says, any AFPS75/05 pension will pay at the rank you retire at AFTER 2015 - not the rank you are at on 1 Apr 15. The rest will be paid on the FAFPS rate (whatever that might be!).

I hope that helps? I for one would suggest that you don't throw away an immediate pension at an option point, however, if you have an option before 2015 then you may want to consider it once FAFPS becomes clearer (for better or worse).

LJ

[Razorduck]

"AFPS05 is too good to be true"

A comment I wished I'd taken notice of! When 05 was coming in I was approaching 40 and 22 years service and not sure if I wanted to stay in the mob or not. Sitting firmly on the fence AFPS05 pushed me off onto the side of staying in. In my view, and that of many others, the new pension was designed to get people to commit to the service till age 55, rewarding them with a hansome pension for doing so. I was happy to commit to the service, I saw it as a fair deal. I'll stay till 55 and you make it worth while. Others who were unsure about this committment, rightly so, remained on AFPS75. If the recent DIN is correct, and assuming I have got this right, those that committed to the service and transferred to 05 will be worse of under FAFPS than those who stayed on 75. It appears that loyalty counts for nothing. I must be getting synical in my old age and unfortunately I have 11 years to do :eek: For those that stayed on 75 the difference in my case is approximately 3k a year and 10k on the gratuity :D I still live in hope that this dicrepency will be rectified, please don't laugh :confused:

[VinRouge]

doesnt it depend on where they set the ipp for the new scheme? surely as pas, you could pvr at the new pas point and have very little change to your pension?

[Razorduck]

Unfortunately I don't want to PVR. So if I stay in till 55 as planned I will be worse off than someone with an identical career that stayed on AFPS75:ugh:

[Melchett01]

Had an interesting brief from the AMP Briefing Team today. Well when I say interesting, I guess it's all relative. However, on the thorny topic of pensions - ironically, not the most prickly issue of the day - they did suggest that although the date for the new scheme was planned to be 1 Apr 2015, the complexities of introducing it meant that 2016 or 2017 was far more likely.

That's the second briefing I've been to where that very same thing has been mentioned, the first briefing being what I would regard as an impecable source. So given that benefits at the point of transition will continue to grow with rank until you leave i.e will reflect promotions and increments rather than being totally frozen at the transition level, it might give people a couple extra years to sort their planning out.

[downsizer]

As I'm sure many would agree, the later they introduce it the better :ok:

[downsizer]

ironically, not the most prickly issue of the day

Out of interest, what was this most prickly issue?

[bootscooter]

"In my view, and that of many others, the new pension was designed to get people to commit to the service till age 55, rewarding them with a hansome pension for doing so. I was happy to commit to the service, I saw it as a fair deal. I'll stay till 55 and you make it worth while. Others who were unsure about this committment, rightly so, remained on AFPS75. If the recent DIN is correct, and assuming I have got this right, those that committed to the service and transferred to 05 will be worse of under FAFPS than those who stayed on 75. It appears that loyalty counts for nothing. I must be getting synical in my old age and unfortunately I have 11 years to do For those that stayed on 75 the difference in my case is approximately 3k a year and 10k on the gratuity I still live in hope that this dicrepency will be rectified, please don't laugh "


This is exactly what concerns me. I opted to join the 05 pension in anticipation of serving to age 55 and based upon the figures given by the RAF itself it made sense to do so.
Would there be any basis upon which those who will be negatively affected by opting back then for 05 could demand to revert to 75? The benifits from swaping have been taken away by the very firm that told us on the Pension calculator that we'd be better off doing so.

[Melchett01]

ironically, not the most prickly issue of the day
Out of interest, what was this most prickly issue?

Rank parity between 22 yr RAF Flt Sgts and 22 month Army WO2s on various Joint units.

[Corporal Clott]

Would there be any basis upon which those who will be negatively affected by opting back then for 05 could demand to revert to 75? The benifits from swaping have been taken away by the very firm that told us on the Pension calculator that we'd be better off doing so.

At the FAFPS presentation that I was at someone asked the same Q; the answer was "it was a one-time offer to swap and no you cannot revert back to the old scheme as it is closed".

CPL Clott

[bootscooter]

Gah! I still can't see how that is legal*

1. Company offers pension deal A giving X, or pension B giving X plus 10%
2. Person signs up to pension B (no brainer as planning to serve to 55)

7 years later Company rips up all previous meaning that pension B is no longer obtainable to those that made positive choice based on Company figures, so it's now worth LESS than the original pension deal A, that they wouldn't have moved from if the Company hadn't made it benificial to do so.


How can that be right?


* moral

[Melchett01]

In a similar fashion, I will be interested to see what they do about AVCs which were tied into the respective schemes.

[Corporal Clott]

Bootscooter

You don't know if FAFPS is going to be worse than AFPS 75 though. As I understand it, no one does. Also, if you jumped from (AFPS) 75 to 05 and became PAS, then ALL of your pay is pensionable under FAFPS anyway. If you're not PAS but joined at <21 years of age I suspect that you will still do better than 75 which was pensionable for service after age 21. 75 was only really better for those that decide to leave before age 55 and by the sound of it you plan to do that - so I suspect, but don't know for sure, that your FAFPS and 05 pension combined will be better than 75 was for you?

If you know what FAFPS is going to pay then great, can you share it with us 'mushrooms' in the dark? :ok:

Of course, I may be completely wrong, but I don't believe that you should get too distressed until you know the facts of FAFPS.

Clott

[bootscooter]

You're right of course, none of us know the details but....

I joined at age 27, have done 16 years, do aim to serve to 55 at which point the 05 pension gives better return than the 75 hence my opting to change to 05. Sadly I'm not PAS.

I assume (yes, I know...) that as I will not serve to 55 on the 05 pension (because of it's replacement) I wont see the benifits of that scheme, and will be worse off than if I'd stayed on the 75 scheme.

I hope I've got this wrong....

[Just This Once...]

Of course, I may be completely wrong, but I don't believe that you should get too distressed until you know the facts of FAFPS.


Clott the point bootscooter makes is in accordance with the DIN and this piece of bad news is bold and ugly fact; like-for-like a person that stayed on '75 will have accrued more than a person who left '75 for '05 but will not make planned retirement on the '05 scheme due to FAFPS introduction. The only thing up for grabs is what is earned after the change.

The DIN gives some like-for-like examples that make grim reading for some of those that switch to '05.

[Corporal Clott]

JTO

The DIN spells out nothing as far as I can see. Until we know what FAFPS will pay out, then we can all guess and scaremonger. The presentation that I sat through with one of the FAFPS team showed exactly the example that's being talked about and they didn't know what FAFPS would pay either - they knew how much AFPS 75 and 05 would likely pay for service to 2015 but not what the FAFPS portion would pay on retirement.

Until we know this, then we are all just guessing. However, it is upon all of us to be fully involved in the consultation process that is just about to kick off.

Clott

PS the link for the consultation is on the bottom right hand side of this webpage Ministry of Defence | About Defence | What we do | Personnel | Armed Forces Pensions Compensation and Veterans | Find out about The Future Armed Forces Pension Scheme (http://www.mod.uk/DefenceInternet/AboutDefence/WhatWeDo/Personnel/Pensions/FindOutAboutTheFutureArmedForcesPensionScheme.htm)

[Just This Once...]

Hi Clott,

Try this thread:

http://www.pprune.org/military-aircrew/468041-armed-forces-pension-10.html#post7045342

But as an example:

Those who made a move to AFPS05 on the basis that would be serving to 55 are in for a rude awakening. Their offers to transfer would have shown them that the pension they would receive at the 55 point would, on either scheme, be about the same. However, the AFPS05 scheme added a few sweeteners, such as 4 time D-I-S, so looked like the best move. However, the new scheme stops them from making their 55 point on AFPS05 so all the disadvantages of the EDP now kick in.

Examples for 2 identical wg cdrs who were both on AFPRS75 till the O-T-T (I've used the figures in the DIN):

27 years of pensionable service at the point of transition to the Future AFPS. He leaves the Armed Forces after 34 years of pensionable service at the age of 55.

Bloke who stayed on AFPS75:

He will be entitled to receive, as his accrued AFPS 75 rights, a taxable Full Career Pension of around £32,000 per annum. He will also be entitled to a tax free lump sum of around £96,000.

Bloke who moved to AFPS05:

He will be entitled to receive, as his accrued AFPS 05 rights, a taxable Pension of around £28,500 per annum. He will also be entitled to a tax free lump sum of around £85,500.

In both cases they will be entitled to pension benefits for the 7 years of pensionable service under the Future AFPS in accordance with the rules of that scheme. The rules of the new scheme, including when pensions will be paid, are under development.

So for changing to a pension scheme that evaporated 9 years later the AFPS05 bloke takes a spanking. If he stay on the old scheme he would have been ok; if the new scheme had seen him to retirement he would have been ok. But moving from 75 to 05 then forced to AFPS15 is a major kicking.

Wonder if anyone will challenge their Offer To Transfer paperwork...

It is all in the DIN, so worth a careful read as I don't do scaremongering - bootscooter has it right.

[Biggus]

As someone who isn't effected by the new pension scheme I haven't been following this issue very closely, however....

I thought it had been stated that anyone within 10 years of retirement had been told that they "wouldn't be effected/suffer" by the introduction of the new pension. Therefore the example of the Wg Cdr quoted, 7 years left to retirement, would surely fall into this category?

Also, what is the exact wording of AFPS05, if it refers to "serving" until 55, then the Wg Cdr in question is doing so...? He hasn't left the service early, and isn't taking EDPs from the age of 48 while still serving as an active Wg Cdr... He just isn't accumulating any more years in his 05 pot (that is of course assuming the "protected with less than 10 years to go" arguement isn't actually being applied)

The choice of changing to 05 or staying on 75 was a personal one, with a variety of factors, not just the 4x D-I-S. The widows pension is also better under 05, and if you coupled 05 with PAS you were in a "win-win" situation. However, as in all things, it did require certain assumptions to be made, as to staying in until 55, there is one school of thought that says retiring before 55 on the 05 scheme is actually the most financially astute option.

Sorry if I've gotten hold of the wrong end of the stick!

[Lima Juliet]

JTO

Those that accepted the offer to transfer took a gamble and now the gamble may be less of such a good deal than they imagine. There are a few aircrew who stayed Spec Aircrew and didn't swap to PAS and they retired on less than they could have as PAS on AFPS05 - there are also those that retired as PAS on AFPS05 who were barely average at their job and got equivalent to a Wg Cdr's pension. What am I trying to say? There are lots of winners and losers in the pension offer to transfer and that is just life.

I could get really mad over the decisions that have occured over the years or I could just live with it. Your example shows a drop of about 10% for the notional Wg Cdr - if that reflects across the board, then its not that bad IMHO. There is also a chance that FAFPS may compensate for this shortfall through the faster accrual rate that is being hinted at (the new civil service scheme is also getting a faster accrual rate I believe?).

I reckon that there will be winners and losers again this time around, there probably always will be. But like Cpl Clott says, let's wait to hear the facts before getting too "angry of Sleaford Town" about it.

LJ

[Equilibrium]

LJ,

To transfer to the 05 pension scheme from the 75 pension scheme in my eyes was never a 'gamble' but a sound decision made by the choices offered to me at the time, & whilst I for 1 will escape unscathed as I'm over 45 on 1 Apr 12, I do feel for the other guys who will get stung.:mad:

[Biggus]

LJ,

How well one did, or didn't, do one's job has never been a determining factor in the size of one's pension!

You appear, but perhaps I am wrong, to be "miffed" that a Flt Lt on the PAS who is "barely average" at their job may retire on a Wg Cdr's size pension. If it's any consolation - rest assured that I have come across quite a few Wg Cdrs who are "barely average" at their job - and nobody seems to query their pension entitlement!




Perhaps I have read the tone of your comment incorrectly - if so I apologise unreservedly!!

[Lima Juliet]

Biggus, Equilibrium et al

No need to apologise as I was being "bullish" with my opinion! :ok:

IIRC the decision to tranfer was made after the PAS spine opened, and so those that chose to transfer to PAS and then to AFPS05 hit the jackpot big time. Those that didn't had a normal pension comensurate to their rank. Quite frankly, IMHO, the PAS and AFPS05 was a complete c0ck up (but very nice for those that got it). It left people "gambling" accepting promotion to Sqn Ldr in the hope they would make Wg Cdr, or they may as well stay a "gash shag" Flt Lt and climbing on the PAS gravy train. The reason for the incredibly devisive FRIs for Sqn Ldr aircrew (a second order c0ck up) was to try and attract those to stay and go for Wg Cdr rank.

On those who elected to go AFPS05, well there are never any guarantees that you would serve to 55 - redundancy, medical discharge or change of family circumstance could all affect the ability to go the long haul. Quite simply, those that switched did take a "gamble" in my opinion and it looks like that gamble MAY not pay off (a notional 10% decrease depending on what FAFPS brings).

As Clott has been saying throughout, there are no decisions yet on FAFPS. It's up to all of us to ensure our circumstances are heard during the consultation process.

Finally, I was on AFPS75 and I'm now on RFPS05 (which is similar to AFPS05) and I'm also likely to be hit by potential FAFPS changes; so I guess that gives me a "speaking chit" and also a right to be concerned. I took a "gamble" and it has taken me outside the protection of the "10 year rule" that I would be under if I hadn't changed (voluntary just like the offer to transfer) - but you won't be hearing me rant about the fairness of it all as sh!t happens...;)

10 years+ notice of a 10% shortfall seems pretty fair as we've all got time to do something about it. Those of us who know others in the civilian world know that they have been suffering similar shortfalls with no back up or ability to consult. I guess what I'm saying is, it's all a matter of perspective.

LJ

[bootscooter]

LJ - so at what time scale, and what percentage slashing of my pension should I start getting upset about? And what if in 6 years time we have our pensions cut again?
I've got 12 years left to my 55, and I'm most certainly not a Wg Cdr that'll be picking up the kind of figures stated up there. I do however, have 2 teenage children that will hopefully be going to University/ buying cars/ buying flats etc and I'd worked out how much I'd be able to help them (not to mention keeping Mrs B in the manner.....) based upon what I'd signed up to receive.
It appears that through not fault of my own I've now lost a sizeable chunk of what I expected, and have even lost out further purely because I had the audacity to agree to a pension that was offered to me.

I don't want to come across as a sulky child, but it really is not fair.
*stamps feet*

[VinRouge]

its good for them. Most are within the 10 year cutoff. bearing in mind the size of their pensions, wouldnt it have been nice for all at 1* and above to waive their grandfather rights? no, thought that wouldnt happen either. :hmm:

[Melchett01]

I am absolutely disgusted by the apparent terms of FAFPS and believe it represents a direct and absolute betrayal of all members of the Armed Forces by the Senior officers who 'claim' to represent them.

Have I missed an announcement? I'm on leave at the moment, so unsighted to the intranet or official announcements. :uhoh:

[Lima Juliet]

Melchy

No announcement of FAFPS or even a draft as yet...

[Al R]

Bootscooter,

Forgeting AVCs for the moment, have you considered other ways of making hay whilst the sun shines? There are lots of pros and cons and they're not right for everyone but given your stated circumstances and possibly, your needs, it might be worth you delving a little deeper to get a more informed perspective.

http://www.mod.uk/NR/rdonlyres/FC4FE9A1-9812-4A53-9982-086E84FA36B5/0/AFPS05AYFactors.pdf

[Melchett01]

Added years is the route I took when looking to boost my pension as a relatively 'late joiner' after 4 years at university. When compared to most, average stock market returns over the past 5 years or so, the idea of being able to bump your guaranteed pension up by an index linked amount each year seemed quite a good deal.

However, I will be very interested to see what happens to AVCs under the new scheme. I am hoping that they won't be massively effected, after all, extra years are just that, so I would hope be applicable to all schemes. If not and they decide to close the AVC route under FAPS, I would hope to get a refund of contributions paid so far if they are not going to honour them.

Out of interest, and related to some of the earlier comments about moving to AFPS 05, one comment from an FPS presentation I attended at the time immediately came to mind about 05. It ran something along the lines of "think very carefully before you elect to change schemes; if in doubt, you should probably stick with what you have now. If you change and it proves to be the correct decision, the benefits will be far outweighed by the potential losses if you change and it proves to have been the wrong choice." A little bit of better the devil you know, but it was enough to persuade me to stay on 75.

[Al R]

AVCs are different to buying Added Years, and placed with a third party so you should be fine. As to what happens to them, perhaps that is best answered by wondering why anyone would want to buy additional units (by whatever route) with a scheme that is looking increasingly out of touch with what people had in mind when they joined up.

Don't be fixated 'just' on stock market returns either - choppy equity March mind.

[Melchett01]

Al,

When I bought into the extra years under the 75 scheme, it was sold as being an 'in scheme' AVC rather than being held with a third party, hence my wondering what will happen to them when that scheme is effectively wound up to new business.

However, I do agree with you entirely on wondering why people would do it. At the time, I was fairly sure I was going to make the effort for the long haul, but these past few years are sorely testing that original plan.

[Corporal Clott]

The online consultation starts today and finishes 11 May 12...

...IT IS IN ALL OF OUR INTERESTS TO FILL IT OUT

FAFPS consultation (http://www.mod.uk/DefenceInternet/AboutDefence/WhatWeDo/Personnel/Pensions/FutureArmedForcesPensionSchemeOnlineQuestionnaire.htm)

Tell your mates about it as well by any means possible

CPL Clott

[Corporal Clott]

PS The presentation I saw is at this link that might help some understand...

http://www.mod.uk/NR/rdonlyres/B2DC9A2D-8033-4CF4-A9D5-3DDC551E93E1/0/20120328FAFPS_Consultation_Standard_V72U.ppt

Warning, it is a big file but worth a read for those that can't make the presentation. :ok:

Clott

[MaroonMan4]

Cpl Clott,

As instructed I filled out the online consultation form and my how disappointed I was. Such a serious subject given such cursory and loaded questions by DASA.

With so much still to be decided this consultation period should be conducted once the draft proposals have been published.

Fundamentally I believe that HMG/HMT are missing the point. The majority of us complete our Service careers between 45-55, and any HR specialisit would advocate that unless the leaving Service Person had particular skills, then this is not the optimum age to compete with the national/international work force.

Therefore EDP, IP and leaving the Service should be retained for the 35-40 year point, with enough lump sum to re-train and to make up the salary in going in at the bottom of a Private Sector HR workforce.

Secondly, if the pension benefits are reduced significantly then Defence's high achievers and those with greatest potential will leave for the private sector as there is no (reduced) incentive to stay (especially if they will have to leave at 55 and then try and establish a second career).

This will result in the not so high achievers and 'B Team' of Defence Senior Leadership making its way to the top ranks.

I believe that it has been the acknowledgement that Service Personnel recognise that their chances of a true second career at 45-55 is much reduced, but outweighed by the understanding that HMG/MOD will rectify this imbalance through a decent pension.

I would also go as far as to suggest that as Pension benefits is probably the number 1 or 2 reason for Service Personnel being retained in Service beyond age 40, that any significant change in Pension rights should also come with a 'break opportunity' for those that want to 'opt out'.

If I had just taken promotion, a new commission, or anything that results in a return of service based upon a career plan with the current Pension Calculator forecasts, then once the full details are known I should be given the option to leave the Service in an attempt to switch to a genuine (and potentially more incentivised) second career in the Private Sector.

My last point is that the current HMG 'are making hay while the sun shines' as the Economic Recession is presenting a rosey picture of the MOD and Service Personnel, many areas in 100% manning that has been unheard of for years. This means that many Service Personnel are just grateful for employment.

But when (and it is when, not if) the economy picks up then it will be interesting to watch how HMG, MOD and if they care, HMT, attempt to prevent the mass VO of Service Personnel, potentially all those 'middle managers' with significant experience in the age bracket 35-45, where hanging in there for the pension is no longer quite the retention positive factor that it once was.

[Corporal Clott]

MM4

Yup, all valid points and I hope you mentioned them in the comments box at the end? The more of us that bring these types of points up, the better, in my opinion. Who knows, it may drag out the consultation beyond the target that in turn will delay FAFPS - we can but hope!

Clott

[Xiapete]

Bootscooter and Razorduck raise a very interesting topic here!

I have many burning questions and thoughts regarding the new pension scheme, but one in particular that is really concerning me.

This is the best way I can explain this scenario!
I believe that I am correct in thinking that if my ‘twin brother’ and I had joined the Service on the same day; both promoted through the ranks on the same day: then one of us transferred to AFPS 05; that when the FAFPS is implemented in 2015 the one who transferred to AFPS 05 having made the long term commitment would be discriminated against and financially worse off!

It would appear from the last update on FAFPS that it would have been prudent for me (like many others) to stay on AFPS 75 and not transfer to AFPS 05. I, like many other members of the armed forces made a massive commitment and dutifully transferred to AFPS 05. I am acutely aware of the financial climate ‘we’ all find ourselves in and ‘we all must share the burden’. Notwithstanding, if my calculations are correct it would appear that I like many others are going to be hit with a ‘double whammy’ simply because we committed to the Service. This cannot be morally acceptable and I really hope that I am wrong on this matter because if it is correct it is perverse!

[Greenielynxpilot]

Please - give us all a break!

Your commitment to the service is expressed through your commission, not your pension. It is actually the Armed Forces that made a massive commitment to you ...

Your transfer to AFPS05 was not dutiful - it will have made financial sense at the time, based on the assumptions you made about the likely length of your residual service.

I'm sorry for you that your assumptions appear to have been mistaken in light of a changing global environment - who could have seen that coming in 2005? However, I will be reserving the majority of my sympathy for those whose loss came as a result of mistaken assumptions made by others, such as all the trainee pilots made redundant last year because the tw&ts at Manning still can't accurately predict demand, after only about 50 years of trying.

The (as yet only hypothetical) losses of those who transferred to AFPS05 comes from having taken a punt on catching two in the bush rather than sticking with the bird in hand. Some on these forums would call that rather naive. Now trot along to join the very long queue of all the other people whose fortunes have suffered as a result of the destruction of our TACOS these last few years.

[Lima Juliet]

Couldn't have put it better myself...:ok:

[Mightycrewseven]

However, a number have been advised to challenge their OTT paperwork and a few are choosing to challenge their PAS offer as the 'remuneration package' has been significantly altered.

OK, what is the 'perceived' score with PAS then? I find myself having been offered, but not yet excepted, PAS this year, therefore, (understanding that details are still exceptionally foggy) how is FAPS likely to change what PAS will bring? My single biggest worry though is that I will be accepting a 5 year RoS (without right to PVR - added last year) which, whilst I agree with the motives behind the RoS, will take me beyond the 2015/2016 change over and locking me in to any changes????

[Arty Fufkin]

Mighty7

It has been confirmed from the FAFPS team that PAS pension supplements earned up to the changeover will be banked as part of your old pension. This is obviously still dependant on completing 5 years on PAS spine.
The big disapointment will be for those who only intended to do the 5 years PAS and then leave with a significantly increased IP and gratuity. Everything earned after the changeover date will be defered until payment iaw the new pension terms. which may not be payable for a long time, and may not include a gratuity.

At the moment, its costing the RAF £80k cash, plus an extra £20,000 gratuity and an extra £6000 per year on my pension payable anytime after the age of 43 to guarantee my services for 5 years. Even then the decision was a close run thing.

Gloat mode dissengaged.

Are you going to accept the same tie-in for the promise of an extra ~£5000 a year on your pension payable from the age of 60? You can do the maths if you like, but that package is worth about 100k at todays annuity rates. Or an extra £20k for each of those five years. They'd have paid you £13k pear year as a pension if you left!
Thats a big commitment from you with not a lot in return.

Of course, you might do it for the love of the job.

[VinRouge]

Kind of makes you wonder what sweeteners will be put into the NEM to kep aircrew in. Lots of ads online for global recruitment, when the recovery comes, what is going to keep people in?

[The English Passenger]

Arty Fufkin,

I do not have access to DII in my present location.

Do you have any more specific detail on how that will work with PAS up to transfer date. i.e. Has there been a new DIN to cover PAS etc as was discussed by the FAFPS team? When I spoke to them a few weeks ago the team were not able to give me an answer on what would be accrued under reserved rights for PAS chaps who will not reach their 5 years ROS before transfer.

My 5 years ROS on PAS will only be completed 6 weeks after 01 Apr 15. My reading of your statement above is that I would get approx 4.8 years of PAS accumulations added to my 38/16 AFPS75 pension, but would that mean my pension would be based on final salary PAS (i.e. level 25) or would it be based on level 9 Flt Lt with a top up for the 4.8 years of PAS?

Any clarification that you can give as to who made the statement to you and how it will work will be greatly appreciated in my current unconnected location.

Thanks,

The English Passenger

[Arty Fufkin]

The email I have a copy of says that in your case you will get 4.8 years of PA supplements.
Just to clarify, as I understand it, AFPS 75 is not a final salary scheme. If you leave at 55 your pension consists of a basic bit, the same as a blunty Flt lt who serves for the same number of years as you, plus so many years worth of PA spine supplements which ensures you get an enhanced pension for being a member of the master race.
In the case of the pension switch over, you get to bank the supplements you earned on AFPS 75, but you must still serve 5 years from going onto the spine.
I'm certainly not an expert, but I reckon in your case, with 4.8 years done, your banked pension will be almost identical to a mate who leaves the RAF today having done 5 years on the PA spine.
Given that Apr 15 is the earliest that the change will happen, I don't think you have much to worry about.

[The English Passenger]

Thanks Arty, any chance of a copy of that e-mail you have via PM? If not coz it is on DII, PM me and I will give you my DII address if you would rather forward to that system.

I am not overly concerned yet as almost everyone I speak to that is connected to the FAFPS is fairly certain that it won't be ready for Apr 15, as that is stated as an aspiration date and is the earliest it will happen, not the set in stone date yet.

Also, anything I get from the 5 years on PAS pension wise will be a bonus.. I stayed for a specific reason and the FRI and the salary over the last few years has been better than some of my contemporaries who left the service and then were made redundant have been getting! So I guess I made the right choice for me regardless.

[bootscooter]

GreenieLynxPilot -

First of all, please do not assume that everyone on here (and everyone affected by these changes) holds a commission.

Secondly, those that opted for the 05 pension made no "assumptions" other than their future fitness to serve to age 55. The figures given on the pension calculator were sold as fact, so regardless of whether the individual would be better off or not that option was a "sign-post" of loyalty and an intension to serve to that age.

We all have sympathy with those that have been dealt with poorly, but just because a significant number of Aircrew In Training were stiffed it doesn't make Xiapete's suggested scenario any less deserving of sympathy or correction by our organisation.

Why is it always a "race to the bottom"?

[Lima Juliet]

I've just found this little nugget in the Hutton Report regarding pension abatement...

Flexible retirement should be encouraged and abatement of pensions in its current form for those who return to work after drawing their pensions should be eliminated

So this could mean that those that have earned a pension and then retire from the Regulars to the Reserves may no longer attract abatement. :ok:

Let's hope

LJ

[blagger]

LJ the briefing team said exactly that this week, FTRS isn't likely to attract pension abatement. Of course in future the chances of a pension before age 60 will be nil so it won't be an issue!

[Hueymeister]

Have yet to read the DIN fully, but when I asked the consultation team on Wednesday what those of us on PAS could expect, he could not be drawn. NOTHING has been decided. I'm on '75, with a year left to qualify for my 5 yr PAS get out. If they make me worse off, ill have to leave to start a second career, either flying or in the aviation related industry. A lot over concentrate on Career Average, but miss Revalue From the rest. It changes the indexing compounded to the pot each year under the new scheme. All they can say is that it'll still be good, just not 'as good'.

[Lima Juliet]

Blagger

The majority of FTRS posts can go to 65 now, so it should make a difference for some. Thanks for the quick reply BTW.

LJ

[Al R]

Leon,

You're right. That stealth para could form quite a bit of new thinking.

[4everAD]

Could someone explain (In simple terms please) how the current pay freeze effects pension rates? I understand that whilst we are in a pay freeze my AFPS 75 pension rates have been frozen (Looking at tables at RAFComm for 2010 and 2011). Am I right in thinking though that pensions in payment have been uplifted by CPI 5% or so (If so where can I see these rates or are they not generic?). Will I ever see the increases being given to pensions in payment with regards to my future pension or am I losing out by 5% ish this year compared to a current pensioner OR am I missing something? (Most likely)

[Voxpop]

The pension codes for those retiring this year are on the MOD website. They are worked out on spot rates on the pay scales for each rank (which is why everyone in the same rank leaving in the same year with the same length of service gets the same rate of pension) so, as there have been no pay rises for some time, they have not changed. This year's pay raise was limited to entry grades, so I doubt there will be a new pension code this year either.

Once a pension is in payment, it increases in line with the agreed inflation factor which, now, is the September rate of the Consumer Prices Index. That was 5.2% for September last year so that is the rate that will be applied this September. If you left last year, remember that the first year's increase is proportionate - so, if you left last April you will get the full amount, if you left in October you will get about half the increase and if you left at the end of March you will not get an increase in April.

The freeze in the pension codes is causing a 'pension trough'. This means that someone leaving in earlier years is getting more than someone leaving now because the pension in payment has risen by the inflation measure year on year while the pension codes have not. To find out more about pension troughs visit our website (Forces Pension Society - Fighting for the Forces and their Families (http://www.forpen.co.uk)) and read the FPS leaflet on the issue.

[On_Loan]

Telegraph this morning - I'm assuming this is the new post 2015 model?


Armed Forces must wait five years longer for pension - Telegraph (http://www.telegraph.co.uk/news/uknews/defence/9340188/Armed-Forces-must-wait-five-years-longer-for-pension.html)

[VinRouge]

Yep, although hoping those of us with large accruals up to 2015 will get our representative IPP at 38/22.

What is interesting is the increase in IPP isn't as bad as I was expecting, which makes me wonder what they are planning for flying pay and lump sum gratuities post 2015.

[Al R]

Leon,

You're right. That stealth para could form quite a bit of new thinking.

Someone is starting to realise this is going to penalise those who have accrued by default, S2P and SERPS benefits (AFPS)?

The Press Association: Pension plans white paper delayed (http://www.google.com/hostednews/ukpress/article/ALeqM5jQptDVlXo-3ucIV1myJXEkwia69g?docId=N0156911342102141846A)

The Government has delayed publishing its plans for a single flat-rate state pension. Yet more uncertainty.

[Al R]

Yep, although hoping those of us with large accruals up to 2015 will get our representative IPP at 38/22.

What is interesting is the increase in IPP isn't as bad as I was expecting, which makes me wonder what they are planning for flying pay and lump sum gratuities post 2015.

Vin,

Apparently, shuffling the IPP to the right wasn't a big issue with survey respondents.

[Albert Another]

What survey?

[Al R]

There was a consultation period until May of this year, which asked for feedback to proposals by snail mail or online.

Ministry of Defence | About Defence | What we do | Personnel | Armed Forces Pensions Compensation and Veterans | Find out about The Future Armed Forces Pension Scheme (http://www.mod.uk/DefenceInternet/AboutDefence/WhatWeDo/Personnel/Pensions/FindOutAboutTheFutureArmedForcesPensionScheme.htm)

[Albert Another]

Great, an important survey that me and my workmates did not know about! :(

[Uncle Ginsters]

Some interesting news from FAFPS this morning. The pension increments for PAS will definitely not be a part of FAFPS; instead, expect some form of adjustment to the pay terms, although quite what, they don't yet know.

I'm not sure what this means to those who have recently signed up to PAS but the implication is that not just your pension but also the pay may see some meddling.

Expect news within 6 months (a very rough figure),

UG

[MaroonMan4]

Albert Another,

I rarely defend the 'system' but on this occasion I must balance your post where you believed that you and your colleagues were unsighted to to the FAPS consultation survey.

Electronically this survey has been given wide exposure, and even when overseas I picked up the requirement to have my say through Cpl Clott's informed posting, notably his post #58 on 29 Mar.

[Al R]

I have to say, I've seen the consultation booklets littered around many various Messes too. Ginsters, if the pay changes, that will prove interesting for planning purposes.

Has anyone heard anything about serving until 60 and does anyone know if there is a Dept within MoD which releases ad hoc or regular updates on the new scheme's evolution?

[MaroonMan4]

But, despite being given ample opportunity to comment I do wonder if the survey is actually informing the decision makers or just an MOD process driven hoop jumping exercise?

I can comment as I enter the twilight of my career with under 10 years to go, so my pension is safe.

But on a daily basis the hierarchy and civil servants should not under estimate the crew room and hangar discussions on the subjects of FAFPs, NEM and the interlinked recession. It is my personal opinion that I feel the silence that is being heard from the shop floor is being construed as some form of willing acceptance and compliance.

This could not be further from the truth, it is just that without a representative body akin to other Public Sector workers (i.e. a Trade Union equivalent) and a growing understanding that the politicians just expect a top class, professional, flexible HM Forces but do not want to fund it, then the majority of Service Personnel are resigned to their pensions falling well below their expectations and what their original understanding of remuneration on joining/gaining career extensions/promotion.

It is a silent time bomb that the MOD and politicians are actively encouraging. While all of this ambiguity, uncertainty and plans to reduce take place at the upper levels, on the shop floor the majority plan their exit, second careers and ensuring that they are well placed to press the JPA button (on their terms) when the devil in the detail is announced.

This may not worry MOD and HMT in times of recession, as many will continue to hover over the JPA button until economy picks up. This may not worry the MOD and HMT when there is an increase in outflow as it will still be able to recruit the youth into the system (there will always be wannabe aircrew leaving school).

However, even if the recent Flight article claiming that the airline industry will require 450,000 new pilots over the next 20 years is only half true, what the MOD and HMT might care about (in retrospect) is the number of experienced personnel with qualifications that take many years that suddenly depart the RAF.

Which is why it is the PAS element of the FAFPs is the most concerning to me, and where I thought I saw many declare their intentions early and opt for a PAS career profile, who now have withdrawn that aspiration to continue for a career in the cockpit and/or plan to leave as soon as the conditions and environment is right for them.

What is really worrying for me is that if PAS is not going to be lucrative to entice people to stay and retain their experience. Not only will we have issues complying with the MAA for SQEP, or at least ensuring that we have future Sqns of enough experience to look after the newbies and career high flyers that need the high profile staff postings away from flying, but we will also create a challenging situation for those responsible for managing careers, as everyone changes away from opting for PAS (because there is no incentive) and opts for a full career (where there will inevitably be the continued financial incentive for promotion).

In sum, I fear the traditional old and bold experience leaving Sqns that may result in increased accident rates, as this cadre will not be replaced by those wanting a professional career in the cockpit as there is no financial incentive (with pull factors increasing from civvie street).

I might be wrong, and hopefully I will be, and I really hope that we do not start seeing increases in SIs citing lack of experience, supervision and authorisation as causal factors in accidents and incidents, and the possibility of mission failures due to not having the experience to undertake the operational tasks.

From my end of the spectrum, the PAS works and provides HM Queen and Country with an Air Force that delivers high flyers future starred ranks, while simultaneously ensuring that there is experience at grass roots to deliver the safety and operational/operator experience.

[VinRouge]

Civil market it is then. And I know a lot more who we're waiting for a sign to indicate which way we were going on PAS. This isn't good at all and unless there is some guidance from NEM indicating all aircrew will recieve a pretty hefty uplift in salary, this is going to be savage.

[Al R]

Do the Americans have a PAS equiv - did I read that was one of the reasons why the USMC lost so many Harriers, because they didn't have that experience in depth? It does seem a great way of delivering Service needs across the board whilst keeping everyone happy.

(Sorry, its not often I go off topic when pensions are being discussed)

[VinRouge]

Is there any online link referencing this or is it just a trumor? Afprb indicated in their last report that there was a disparity between pa and non pa ref pensions, is there a chance specialist pay will become pensionable for all from entry into the service, with all aircrew entering the pa spine from day one of flying training? Rather than maxing at top level flt lt, wouldn't it make more sense to have a 35 tier pilot salary which you increment up if you stay in,with lower top level pay than PA?

[Reverend 71]

Al R, the FAPS Team under DCDS Pers are responsible for communications on the new pension scheme from the Centre, with internal comms coming from the single Service Pay Colonels. The FAFPS Team's page is on the Defence Intranet and internet and the RAF have related pages on Air Web (under A1 Spec Support/Pay and Allowances) and Airspace.

With regards PAS, I thought clarification had already been given with regards to how it will be affected by the future pension scheme as it is relatively straightforward (await incoming), but I could not see anything on the FAFPS Team's FAQ page on it. My understanding was that all personnel on PAS following the introduction of FAFPS their pension will be based on career average of their earnings from the date of the new scheme's introduction. The amount of pension accrued under FAFPS will therefore depend on their earnings from 1 Apr 15 (when the scheme is due to start) and the scheme's accrual rate, which has yet to be announced.

For those personnel on PAS and on AFPS 75 as at 31 Mar 15, the pension supplements they have accrued up to that point will be treated as an accrued right in addition to the basic pay related element of their pension. For those who have completed their 5 yr ROS that is relatively straightforward - what you have earned is in the bank and everything from 1 Apr 15 will be on career average. For those who have yet to complete their ROS they will still need to do their 5 yrs to qualify for the pension supplements as an accrued right and once they had done their 5 yrs they would be entitled to all the supplements earned up to 31 Mar 15 in addition to the basic pay related element of their pension prior to that date. Everything else post 1 Apr 15 would be on career average of their salary as above. For those on AFPS 05 the pension earned up to transfer to FAFPS is subject to the same calculation as anyone else as it would be based on final salary on departure and years of pensionable service under AFPS 05.

With regards MM4's points on retention, as I understand it the RAF's approach to managing the FAFPS piece has the potential risk to Operational Capability at its heart, with Gp COS fully engaged as well as COS Pers' area. It is not being looked at as merely a pension policy issue best left to adminers to decide how to best to implement it.

[MaroonMan4]

Rev 71,

Thanks for your informative post. I think that you have clarified one element for those contemplating going PAS between now and 2015 in that nothing changes and they will hop across to PAS pay scales, which will be protected up to 01 April 2015 (or whenever FAFPS is introduced), and can be drawn after 5 years ROS. From 2015 though the pension becomes career average with everyone else.

However Rev, unlike the current pension calculator which allows Service Personnel to make a fully informed decision on whether to have professional/financial aspirations for a full career and promotion or a PAS career path, no one can make an informed decision.

You say it is quite simple, but I would suggest that until we have formally endorsed pay scales that provide the comparison of current and projected pay and pension and between a full career or PAS, then the majority will continue to plan their exit strategy and/or create the charade that they want a full career (just in case the PAS figures turn out to be significantly lower than going the career route).

The key point being that everyone I know that isn't within the magic 10 years is working on options, hovering over the JPA button, waiting to see the devil in the finacial detail (not the briefing material prose) to compare and contrast their own personal current and future potential financial remenuration.

In the short term (2015-2017) this will not affect this Govt or MOD and will provide the savings demanded by HMT. In the medium to longer term we may look back on this thread with a very different perspective.

[Reverend 71]

MM4,

I am unsure whether I have understood your point fully, but the announcement of the scheme design for FAFPS will have no bearing on current or future PAS pay scales or any other pay scales. FAFPS will just be interested in how much pensionable pay you earn each year and do not expect SP(F) to become pensionable from 1 Apr 15. Its austerity, innit.

Given that the value of your FAFPS will be based solely upon your annual pensionable earnings from the date of its introduction, once we have an accrual rate you could work out the value of your future pension using current pay scales, which would tell you its comparative value at today's rates. This is no different to AFPS 75 or 05, whereby the Pension Calculator uses current pay rates to calculate your projected pension based on your projected length of service and rank on your forecast exit date. As you know, what the calculator tells you that you will get is not what you would receive as it is based on current pension rates and does not forecast future pay increases whose benefits would have a compounding effect. FAFPS will admittedly be more difficult to predict because you will not be able to forecast what future pay increases will be, as now; the date of future promotions; the annual revaluations rates for your annual pension contributions etc, all of which will also have a compounding effect. The FAFPS Team have initiated work to develop a FAFPS Pension Calculator that may be available middle of next year.

Given this, those assessing whether to accept PAS or not should, IMHO, use current pay scales to compare basic and PAS incremental pay scales and apply a set accrual rate (say 1/70ths from AFPS 05) and consider which they would be better off on under career average. Once the FAFPS accrual rate has been announced, which may not be too long, just update the accrual rate to give you a more accurate idea of the delta, mindful that many public sector schemes are settling at around 1/60ths, so ours should be higher.

With regards to future changes to pay policy, don't hold your breath, I think concrete proposals may some time off yet.

Here endeth the lesson.

[Uncle Ginsters]

I'm sorry Rev71, but i feel you're missing the point somewhat for those with an offer currently on the table.

The information given to me directly from FAFPS (and i haven't seen this published anywhere, which is why i asked them) is that both the pension and pay scales/schemes for PAS are likely to change as a result of FAFPS. The grandfather rights from AFPS 75 are a given. That was for the first 16yrs' service. This discussion concerns singing up for a for a further 17yrs service with few, if any, terms to go by. From now, only 3 years would be on the current pension, we're talking about the following 14 years of potential service.

It may be easy to say that those contemplating their future should calculate x, y, and z and reach a decision. With both pay and pension up for 'adjustment', how can anyone in this position possibly know hat their x's, y's and z's are??? The reality, however, is that those having to make a decision, do not currently have any certain terms to go by. Let's face it, Manning's hands are tied by the wider changes to AFPS and Pay. Nothwithstanding that, they have made little or no attempt to address these issues - such as offering an additional option for new PAS folk at the AFPS changeover point in case the future is that negative.

Imagine the civilian equivalent - could you imagine anyone signing any contract that whose Ts & Cs only covered minimum work required, but no mention of pay or pension.

Here's hoping for the best for the future.

UG

[VinRouge]

Reviewing the BALPA payscales website, I confirmed that even with max commutation, a service leaver (probably AC captain) at 38 would be on more as a FO on completion of training from DAY 1 for both V and BA than staying on as PA, assuming command after 12 years. Not to mention the £90k tax free salary on offer from some ME long haul airlines (awaiting changes to company policy regarding ex mil).

With changes to pensions, this pushes the decision to leave towards option, where most have around the 3000 hours multi jet over 50T that the national carriers are seeking. Having worked it out, it appears the Military is over £200K Net short of what the lowest paying long haul airlines are offering from 38 to age 60, this is based upon earning 5% on max commutation (mortgage payoff?) doesnt include the w@nk that is actuals based allowances, biannual fitness tests, PDRB, RSOI, and the threat of being posted to a desk tour or a 6 month out of area. You would have to be frankly mad to stay in past Option once they screw our pensions.

Unfortunately, "they" have turned a lifestyle into a job, with PUS verbally confirming we shouldnt expect any different treatment to the CS. With the madness of redundancies (some techies are being signed up allegedly a few months after going in tranche one, apparently we are short) I ask again, what is there to stay in for?

[alfred_the_great]

VR (and others) - **** or get off the pot. Your whining is dreary.

[MaroonMan4]

Alfred,

Thanks for adding value to the discussion, and this is what many of those reviewing a career in the Air Force were expecting.

You are either 'home and dry' regarding the 10 year rule, bitter and twisted because you wish you had gone career or PAS, but made the wrong decision, or just have little or no empathy with those that actually enjoy today's Air Force, but are concerned that the maths will not add up (where only a year ago it did). Or you have been promoted (early) and therefore sit comfortably anyway :=

Doesn't the future safety and Operational Capability of tomorrow's RAF concern you? I will be long gone (and I sense so will you?) , but I do care in ensuring that those under my command have the best advice on which to inform their decisions, and hopefully concurrently preventing the experience from haemorrhaging into the private sector.

If this is the master plan to further reduce aircrew numbers (because we missed a trick or it was too costly through redundancy) then it would be nice to know that this was Manning policy and that they had underwritten some of the inevitable risk in such a policy (rather than silently risky shift to future DDHs and OCs).

It will also prevent me from expending many hours with these people that really are concerned about their (financial) futures and in pursuing a career path where the detail of what they are committing to is not known, with what appears at best complicated wordage and at worst no empathy or understanding as to why this might be an issue (and I would suggest that your post falls into this category).

We had a system that works. PAS isn't for everyone (and lacked the job variation and career diversity for me), but it is essential to have those selected for this career path with the right qualifications and experience if we want to be able to operate safely and effectively, and bring on the newbies. If we reduce the incentive for PAS we will reduce the quality of candidates for selection and potentially lose significant amount of experience/qualifications that have taken whole careers to obtain quicker than you can say FAFPS in full or push (JPA button) here.

And Alfred, just so that there is absolutely no doubt I think you will find that the people that you are referring to (the talent and potential future of the Air Force) are already all having a poo, but will get off the pot when it suits them and in their own time frame.

[Easy Street]

There is not a lot of empathy or indeed sympathy anywhere in Manning at the moment. The general message is "like it or lump it", whether regarding allowances, pay, pensions or career prospects. The assumption underpinning this, no doubt, is that the really determined career climbers will stick it out regardless in their pursuit of bigger and better things in a smaller air force. Unfortunately the career 'plodders' who are happy simply to be excellent at their day jobs don't have this motivation, and expect to be remunerated at a level commensurate with their experience (and value to the organisation). Unfortunately many career climbers have nothing but derision for 'plodders' and this is reflected in some of the stuff we have seen over the last couple of years - just look at the low value attached to primary duties by promotion boards, for example.

**** on the 'plodders' enough and they will leave, which will leave an RAF consisting of career climbers (too senior to fly), career climbers who fell off the ladder (who often aren't much good at flying because their limited capacity was all spent on gaining promotion) and young'uns still deciding whether to become career climbers or jump early (and these are obviously lacking in experience). Not a particularly attractive mix to be Boss of - so why would the career climbers stick around either?

[LFFC]

Imagine the civilian equivalent - could you imagine anyone signing any contract that whose Ts & Cs only covered minimum work required, but no mention of pay or pension.

Uncle G,

I really sympathise with your position. However, much as I agree that a starting salary would be part of any civilian contract, change - good or bad - after the first year is always a distinct possibility in the civilian world. More importantly, never forget that most civilians would be delighted to think that they had a job for the next 3 years, planning for the next 14 years would be almost unimaginable. So a degree of magnanimity is probably appropriate.

I hope everything works out for you, and remember that a lot can happen in 3 years.

[alfred_the_great]

MM4,

as a Naval Officer who is not in reciept of SP I do find the constant whining about having folded into pensions a little tiresome. As I have turned down 2 opportunities to join a SP earning community (through choice) there is no sense of bitterness - indeed SP is an added extra. If you don't like the way it is administered, and/or it's not enough to keep you in, then leave. Don't spend hours going on about it over and over again. There are lots of people carrying out specialised jobs in the Armed Forces who don't get extra money to do it.

I have no doubt that those who proposed AFPS05 did so in good faith, and the world has changed since. To ask for retrospective changes is bizarre and smacks more than a little of greed. I presume those who made the change from '75 to '05 were in search of more money and now that they won't get it they want to go back. Would they do so if '05 remained more profitable? You made a decision on the basis of the information available, live with it. There certainly was no paper-work describing AFPS15 hidden in a drawer to whipped out as soon as you made the decision.

Operational Capability is OC, and I have no doubt the RAF will survive regardless of how many leave. It might not be to your liking, and it might not have the capabilities it has now, but the world will turn; there will always people who want to be Pilots, there will always be old Pilots who just want to fly, and there will always be old Pilots who can't be arsed to leave. At present it seems far too many contributors to this thread believe they are the only answer to RAFs problems. If the grass is greener, go next door.

I appreciate that some are trying to be a good DO in all this, but there is a limit. We can't predict the future, and if your Division are so concerned about their future earnings that this is enough to make them uncommitted to life in the RAF, then I suggest they look for something else more stable.

[Al R]

Alfred,

Without contending the thrust of what you say, the people I speak with about this (and there are many), are weary of living with the constant uncertainty and the constant expectation that coping with change is an integral part of the service contract now. AFPS is just one small aspect of the sense of malaise; NEM is only going to increase the sense of ever increasing, ever relentless change that servicemen (and their families more importantly) are expected to deal with.

If you spend a huge chunk of your life (as they do these days) isolated geographically, culturally, literally and physically from civvy street, then the sense of isolation is only going to get greater. Add to that, the sense that the feeling of commitment is only going one way, and add the fact that people can now communicate about it - I wonder if the reaction would have been any more different years/decades ago?

I don't think people are whining for the sake of it. The people I speak with just want certainty - once you know where the bottom is and when its going to be reached, then you can rebound off it and make plans. SP still and will always apply traditional service levels of commitment to the way they go about their business, but all they seem to get is a civilian level of service in return. The system will always capitalise on that and it is to servicemens credit (and to their ultimate disadvantage) that they will continue to plough on regardless.

[Albert Another]

MaroonMan4 …….I have bitten…..but with no hard feelings….

Before I retort I thought I would check my data trail for a keyword search of ‘survey’. I found no such word or reference in it. The first key information about the new pension was a DIN I got after Cpl Clott’s post. Although very informative the DIN had no mention of a survey. Before that I had actively requested information from JPAC and PSF but was told to wait for information. To respond to your post on the 26th of July:

1) ‘believed that you and your colleagues were unsighted’ – They were. I asked them. Since then I have asked other serving members, from various sections, trades and ranks who LI or LO; they too were unsighted of the survey aspect of consultation.

2) ‘and even when overseas I picked up the requirement to have my say through Cpl Clott's informed posting’ – Cpl Clott’s post was very helpful, if you saw it, but PPrune is not how I should get informed about vital stuff. Besides unless you check regularly, a thread can easily drop-off page one of the threads list before you see it.

If it was just me and a few other I could accept that I may have missed it but that is not the case.

Now I have seen the survey it appears that the consultation was about AFPS 05 with no comparisons to AFPS 75. Suddenly I feel on the edge of a plank with the swords at my back which is not where I want to be.

PS: I am now following this thread so I will hopefully receive tip-offs about future consultation documents which I will pass on to others.

[Reverend 71]

Albert,

The online survey was part of the FAFPS consultation process that was launched on 29 Mar 12 and finished on 31 May. As usual this was announced in a DIN and an IBN was issued at the same time down the RAF chain. The FAFPS Team also did a load of briefings to MOBs and training units with focus groups at the end for various groups. On my unit the station pension focal point (each RAF unit has been required to appoint at least one JO or SNCO to disseminate information on pensions and provide feedback) did a brief on AFPS 75 and 05 before the FAFPS Team arrived and also repeated the Team's presentation later for those who were unable to attend their brief. The brief I went to was well attended and the Stn Cdr did the introductions so it had a fairly high profile here. I have just checked and FAFPS Team's presentation and script remains available on the MoD website to download if you want more detail. I think there were also pieces in the RAF News on it when it came out initially. So to echo some earlier posts, I thought the information was fairly accessible. With regards the survey questions relating to AFPS 05, this is because AFPS 75 is a closed scheme, therefore the changes proposed under FAFPS use AFPS 05 as the comparator as it is the most current and only open pension scheme for Regular Service personnel.

Reverend 71

[Corporal Clott]

Thanks for all the credit chaps, but all I did was attend one of these...

The FAFPS Team also did a load of briefings to MOBs and training units with focus groups at the end for various groups.

...and then keep an eye on the MoD website every other day or so.

Although it does remind me of this (with my underline Italics added):

VOGON CAPTAIN:
[On Speakers] People of Earth your attention please. This is Prostectic Vogon Jeltz of the Galactic Hyperspace Planet Council. As you no doubt will be aware, the plans for the development of the outlying regions of the western spiral arm of the galaxy require the building of a hyperspace express route through your star system and, regrettably, your planet is one of those scheduled for demolition. The process will take slightly less than two of your Earth minutes thank you very much.

MANKIND:
[Yells of protest]

VOGON CAPTAIN:
There's no point in acting all surprised about it. All the planning charts and demolition orders have been on display at your local planning department in Alpha Centauri for fifty of your Earth years so you've had plenty of time to lodge any formal complaints and its far too late to start making a fuss about it now.

MANKIND:
[Louder yells of protest]

VOGON CAPTAIN:
What do you mean you've never been to Alpha Centauri? Oh for heaven sake mankind it's only four light years away you know! I'm sorry but if you can't be bothered to take an interest in local affairs that's your own regard. Energise the demolition beams! God I don't know…apathetic bloody planet, I've no sympathy at all…



CPL Clott :ok:

[Al R]

Alas, the MoD has previous though, when it comes to communicating AFPS detail. Para 13 refers (from just a few months back, although it does refer to events dating back to 1995).

Pensions Ombudsman rejects ex RAF AFPS member's claim (http://www.echelonwealthcare.co.uk/?p=2056)

He was not however provided with full information; a simple statement to the effect that specific index linking would not necessarily continue would have completely changed his decision to leave. He had been wrongly encouraged to consider the information he received about pension increases as reliable.
There does appear to be rather a lot of emphasis on the 'ignorance is no excuse' principle. Also, SPVA appears to be nicely insulated and if you do want to leave because of changes to AFPS and if you then seek redress, don't base your case on anything out of the MoD's control. This ruling took close to 2 years by the look of it.

[Roland Pulfrew]

Calling Albert Another

Hot off the press from the Defence Intranet:

The proposed Outline Scheme Design of the new Armed Forces Pension Scheme to be introduced after April 2015 has been published today, 31 July.






The Outline Scheme Design, which sets out the key features of the new scheme is primarily aimed at Service personnel to explain the new scheme to those who will be affected. It will also be sent to external groups, including the Forces' Families Federations, the Forces Pension Society and the Royal British Legion.

Service personnel and external groups can submit comments by Friday 7 September. The final design will be agreed in September.


Over to you ;)

[downsizer]

Have we got a link for those of us not in work?

[Al R]

.. if anyone can slip me a copy too, I'd be grateful.

Thanks.

[Reverend 71]

An accrual rate of 1/47th. That'll do nicely, sir.

[downsizer]

Found it.... PDF at bottom of the page....


http://www.mod.uk/DefenceInternet/AboutDefence/CorporatePublications/ConsultationsandCommunications/PublicConsultations/TheNewArmedForcesPensionSchemeFinalConsultation.htm

[Al R]

New Civil Service scheme has an accrual rate of 1/43 I think. Still good though when you consider at outset, the g'ment was talking about 1/65 for some public sector workers (nurses, I think, are 1:54).

(thanks Downsizer)

[downsizer]

I don't get it, it says lump sums to be removed ala '75 and '05 yet says after 20/40 lump sum is paid at 2.5xdeferred pension on new scheme? Things were much simpler on '75...:(

[Reverend 71]

Al R,

Yes, I think you are right about the Civil Service, but they pay through the nose with personal contributions for that scheme and work for longer. We will still pay no personal contribution (and no our pay is not abated by 4% before anyone mentions it) and have a NPA of 60. I think the FAFPS Team have negotiated a good deal, given the hand they have been dealt. Indeed, I think a few of us will be better off under FAFPS than AFPS 75.

Rev

[Exiled]

Sounded good until I read:

Normal Pension Age of 60, though pension can be taken earlier (from 55), actuarially reduced from the Deferred Pension Age, as it will be paid for longer.

Is it just me, or does having an actuarially reduced pension at a compulsory retirement age seem like a bit of a con?

I suspect that we will not be too impressed when we find out what the actual accrual rate is.

[Al R]

Rev,

Yes - agreed. I wouldn't like to be a nurse though (I don't have the legs for starters).

I've just read it and it could be a lot, lot worse (the devil is in the detail of course). And yes, you are right. Amongst others, this will benefit scheme member with a particular outlook on life!

btw: 75 was out of date pretty damned quickly and 05 wasn't far behind. Knowing how fluid actuaries are right now about being future-proof, instinct tells me this won't last anywhere near 25 years (re: below).

There should be no further changes to the new scheme for the next 25 years. The Government has said that new public service pension schemes should endure for 25 years, and has committed to no further changes during this period. The Government will set a cost cap on MOD’s contribution to future Armed Forces pensions; this will constrain costs which arise from unforeseen pressures (such as further increases in longevity). Provided the scheme remains within this cost cap, no changes to scheme design, benefits or contribution rates should be necessary. If costs were to rise above, or fall below, the cap in future, the new Pensions Board would consider the best approach to managing the increasing costs. Service personnel would be consulted about any changes

[Exiled]

Al,

My point is that a lot of people will assume that the accrual rate is linked to the Normal Retirement Age and would calculate their pensions based upon that.

In fact it's not, the rate is linked to retirement at 67 and for that reason the retirement at 60 is not the good deal you would assume that it is, it's just forced early retirement.

[3 bladed beast]

I must admit to only a skim reading on this thus far.

Being on 75 pension, leaving early 2017 I think it hasn't hit too hard.

I believe that the quote ' The benefits you have already built up in your existing pension scheme will be protected and you will receive them when you would have expected to, linked to your final rank and pensionable pay – these are known as your accrued rights' gives me some ease.

I also like 'First day of paid service in the Armed Forces for both Officers and Other Ranks regardless of age'.

However, does the first quote mean that we are still going to get the lump sum ( albeit slightly less now, given calculations taken until 2015, vice 2017) or do we have to wait for that and commute at the 12:1 rate.

Slightly confused for sure. I wonder who our in service experts will be on this one.

[Al R]

Yes, no more doing a year or so for the Queen.

How old are you in 2017? If you were born on or before 1 April 1967, you can stay on 75 and you won't be affected. If you're too young, you may still get the slightly smaller amount of your fund (three times annual pension as cash) in 2017 (depending on how many years you have done) and then at 65, have the ability to commute on the final 2 years worth of fund - which will mean (in real terms) a particularly small amount if you choose to go down that route. You could still also qualify for the FAFPS EDP.

The new EDP will continue to consist of a monthly income plus a tax-free lump sum. The monthly income will be 34% of the value of the ‘pension pot’ based on 1/47ths, plus a tax-free EDP lump sum of 2.25 times the ‘pension pot’. Further work is being undertaken to investigate the potential for giving Service personnel greater flexibility in how they receive their EDP benefits, in light of the responses to the initial consultation. The results of this work will be announced when a final agreement on the scheme design is announced in September.

[4everAD]

Being no expert on the ins and outs of pensions I await with eagerness the revised pension calculator then I'll have some idea of whether this is good or bad! I notice still that my bug bear with 05 hasn't been resolved, if you join up under 18 you still won't be 40 after 22 years service so no EDP just a deferred pension at 65 (i.e at least 20 years service and at least 40 years of age, court cases to follow unless they change Terms of Service, which I add they weren't planning on AFPS 05 but promise this time)

[harrier123]

I have a similar question. I am on AFPS 75.

I hit my 16 yr point in 2017 so I am guessing that I will get 14/16s of my pension and lump sum. The question I have is, will you still be able to commute to increase your lump sum.

Fingers crossed it gets delayed! Every year would help us all.

[wokkamate]

Seriously?

BBC News - Pension reforms for military outlined by MoD (http://www.bbc.co.uk/news/uk-19070222)

If this happens, I am gone. I think I was pretty happy to serve to 55 with a good pension, so I could do some nice chillaxing when I left, however giving another 5 years of (literally) blood, sweat and tears is going to push me over the edge. Yes, it is still better than other pensions, but no other organisations asks so much of its people........:ugh:

I just miss out on the 10 years to go bit (aged 45) by a few months too...utter, utter bollox. I have had enough. Time to say ta ta, and they could have had another few years out of me too. :rolleyes:

[Lima Juliet]

It's a little unclear for FTRS as it states that FAFPS will only pay out at or after the proposed 20/20 point. With some FTRS taking contracts at age 40 or above, does that mean working to a 20 year point or wait until age 65 when most FTRS retire age 60?!

If it is as before, where RFPS05 paid 1/70th of final pensionable salary and FAFPS pays 1/47th of final pensionable salary, then I am very much "quids in" and my pension at 60 for my FTRS time will be £16k under FAFPS whereas under RFPS05 it would be £10.7k!

Any pointers into how I have interpretted it, gratefully recieved!

LJ

[FJ2ME]

Also posted in the other thread, but reposted here in hope of answers...:

So can anyone answer a quick question-if you leave after 2015 but you are not within 10 years of Full pension, ie over 44 last march, do we now have to serve until 40 to get a lump sum, pension from the end of our commission. I'm on AFPS 75 and plan to leave at 38/16 point-where do I, and thousands like me, stand? Its pretty clear what the case is for new-joiners and near-retirees but, as ever, the middle ground is left in a quagmire....This may have massive implications for people of my age approaching their 12 year option right now...

[RandomBlah]

FJ2ME,

I stand to be corrected by AL R, but i believe this to be the case (yours is similar to mine).

If you leave after April 2015, due to the statement on accrued rights, you will recieve X/16ths of your pension + a lump sum of 3-times this (where X is your number of years on AFPS 75) immediately. Any benefits earnt under the new scheme will be paid from State retirement age (most likely 68 for you and I) if you don't serve until age 55. If you did make it to age 55, you would recieve these benefits at age 60. I think thats about it.

[Al R]

If you want to tell me when you joined, what rank you are and when you'd be expected to leave etc, I'll try and let you know. I'm at Bze tomorrow so if you want to e-mail or PM me, I'll get back to you if you like.

[Backwards PLT]

If someone (Al I'm looking at you ;)) can answer this I would appreciate it.

If I were to go onto PAS then (ignoring the year or so until 1 Apr 15) what is the "pensionable pay" used to calculate my pension? Is it some rank equivalent thing or will it be my actual PAS pay spine pay?

Thanks

[Melchett01]

FJ2ME,

I think I'm probably in a similar boat to you i.e. the middle ground straddling both schemes. And you're not the only one currently scratching their head. I think - hope - a new calculator will come out in September when they make the final announcement.

However, from what I can gather, the following seems to apply if you reach your 16/38 point before the new scheme kicks in:

2014: Melchett reaches 16/38 point, qualifies for IP + lump sum (AFPS 75)
2015: Transfer to new scheme. All previous benefits earned to date remain payable as normal
2020: Melchett pulls yellow and black, leaving after 22 years service. Draws an IP + lump sum for service up to 2015 under AFPS 75 plus an EDP for service between 2015 - 2020 under new scheme.
2040: Melchett stunned to have made retirement age. All previous payments now uprated in line with CPI and residual element of the new pension scheme earned between 2015-2020 is paid out.

I think that's it as I understand, unless I've got completely the wrong end of the stick - which wouldn't be the first time. That said, there's a little gremlin working away at the back of my mind that says I might even be better off at retirement by transfering to the new scheme than had I remained on the 75 scheme because of the higher accrual rates coupled with the fact that as far as the new career average scheme is concerned, my starting salary will be based on what I am earning at the time of transition and then going forward rather than what I was earning as a Plt Off going through Cranwell in the 90s.

Whether my patience lasts long enough to accrue a full pension is, however, a very different matter.

[Al R]

PLT,

Are you on 75 or 05?

On the surface of it (slopy shoulders), it is your PAS salary (as those on PAS no longer receive flying pay, all your salary counts towards the pension). However, PAS rules may also apply, such as completing a minimum of 5 years to qualify for the enhanced pension - and I believe that you qualify for the "extra" pension after you have served the 5 years. If though, you left before the 5 year period had elapsed you got the standard pension for your rank (did that get revoked on Appeal?).

To my mind, even if you ended up leaving, isn't it in your interest to strongly consider the PA offer now anyway? If you were to PVR on day 1 of FAFPS you would not lose any flying pay and you would not suffer a reduced PVR rate pension on any pre FAFPS pension because you didn’t PVR from it. On the surface of it, with the accrual rates being announced and because the EDP/Gratuity hasn’t been changed to the point that it will adversely affect most people attracted to PAS anyway, why not give it some serious consideration..?

[FJ2ME]

Melchett,

Not quite the same boat I'm afraid, I reach my 38/16 point in 2019. What concerns me most at this point is whether I will now have to serve until 40/20 to get an immediate pension and lump sum at all. If the answer is yes, then that will be an instant decision to take my option at 12 year point, 2015, because there is literally no point in staying.. Ridiculous.

[3 bladed beast]

I will definitely need this clarifying by someone soon!

On 75, leaving March 2017 at 38 point. Is it definite that I would get a lump sum, ( albeit it missing out on last couple of years)

The way it could be read is that I have to serve to 20 years and age 40.

Oh how confusing, At least it doesn't affect our future. Oh.

[Backwards PLT]

Al

Thanks for the reply.

I'm actually on 75 but isn't that irrelevant to what I will get post 2015?

So if, for example, I am 42 on 1 Apr 15 and serve until 60 (1 Apr 33), have accepted PAS before then and nothing else changes (such as promotion :eek:) I will get 18/47 of my average salary between those 2 dates (which won't change that much, just a few PAS levels).

Sounds too good to be true.

[Al R]

Backwards,

I asked because my brain was struggling about the 5 year payback rule. Its a bit late. Don't take this the wrong way (I know you won't), but through luck and not judgment, by getting a nice salaried increase and then levelling out, you conform to the profile of the type to benefit most because the new scheme has no built in memory - it doesn't know what you did before 2015.

One of the charges levelled against these schemes is that they flatten out career profiles and dull a member's aspirations (Unions love 'em). In other words, they don't incentivise the chargers as 75 and 05 did and those who want to charge a bit more towards the end of a career may as well not bother if they are motivated by the money. Instead, they encourage mediocrity and tend to lump more people in a more tightly defined profile (actuaries and trustees like the greater sense of certainty).

In 75 and 05, members whose salary rise fastest get a better bang per buck from the scheme than those whose salary rises at a slower rate. In FAFPS, all members may get a pension which is thought to be fairer as it better reflects the earnings and contributions throughout the members’ careers. Either way, take proper advice that you trust before you do anything drastic!

[3 bladed beast]

Antelope

Those are my exact worries. I certainly would not choose to extend at all and would presume I get my 'accrued rights' at age 38, 2017.

That said, until it is confirmed, I shall be worrying a touch.

[Reverend 71]

Backwards,

As well as getting 18 yrs worth of Career Average, don't forget that the value of each year's contributions will be revalued by an average earnings index so you will also benefit from the effect of compounding and annual pay rises when they come back into play. Add your accrued benefits from AFPS 05 or 75 and you may have as good a pension as before, if not better.

With regards qualification for accrued rights under AFPS 75 or 05, all previous briefings/DINs etc remain extant. Therefore, if you were on a 38/16 or 40/18 engagement that finishes after 1 Apr 15, then so long as you complete that engagement you will be able to access those benefits (pension/EDP/lump sum) accrued up to the introduction of FAFPS at the same time you would have expected to receive them previously.

With regards the impact on high flyers, this will be something that the AFPRB, SSRB and NEM will have to look at to ensure remuneration packages remain competitive once the lower value of a Career Average pension is taken into account. There may be resultant pay increases at some levels so that people are paid better for doing the actual job, but unlike a final salary scheme under Career Average the State would not end up paying them a very generous pension for the next 30 years based on what could have been a relatively short period of their overall career.

[Al R]

CM,

You will get 13/16 accrued AFPS 75 benefits when you leave. You will then get 3/16 accrued FAFPS benefits at state pension age (68 for you?). This, I think, is the problem for many people.. there is a gap which has to be filled.

The examples don't cover anyone in your particular situation - which ios frustrating. Although they can't cover everyone, I am sure that there are many more officers and SNCOs who will be in your position.

Calculating your State Pension age : Directgov - Pensions and retirement planning (http://www.direct.gov.uk/en/pensionsandretirementplanning/statepension/dg_4017919)

[rock34]

Ditto CharlieMike,

I'm on the 75 scheme, 16/38 point in 2016. I'm presuming (hoping) that I get 15/16th of my 75 scheme then, ie immediate pension and lump sum, and a year and a bit of the new scheme which I assume won't be anything immediate. Is that right? :confused:

[Al R]

rock34 (Feu de fer?)

You'll get the outstanding 1/16 FAFPS benefit at your state retirement age.

[Canadian WokkaDoctor]

wow, that sucks! I'm glad I jumped ship 3 years ago.

CWD

[Al R]

As well as getting 18 yrs worth of Career Average, don't forget that the value of each year's contributions will be revalued by an average earnings index so you will also benefit from the effect of compounding and annual pay rises when they come back into play.

It should be noted that the revaluation rate isn't going to be the 'Average Earnings Index' (which went in 2010 anyway) but 'an' average earnings index (as you correctly state) - specifically, the 'Average Weekly Earnings' (AWE) index. Unison campaigned long and hard against AWE - government actuaries concede that AWE can fluctuate, in the 3 years to the end of 2010, AWE was 1.7% per year below even CPI. Unison secured a CARE pension revaluation rate of CPI + 1.5% (fixed).

In fairness and in the interests of balance, AWE is assumed by many to be rise 1.5% above RPI (which is assumed to be 4.6% pa) and future CPI is assumed to be 3.6% pa, i.e. 1% lower than RPI (actual CPI September 2010 was 3.1% pa.). But given that public sector bonuses are taken into account when calculating AWE, can I now assume that we'll see a campaign to increase the amount of the average MoD civil servant bonus?!

There is much talk about the RPI/CPI revaluation of pensions in payment. This one though, is going to be the sleeper to keep an eye on.

[downsizer]

In 2015 I'll have done 19 under '75....

If I stay till my 22 year point in 2018 am I right in thinking I'll get 19 years worth of IP and lump sum from '75 and 3 years worth of EDP and lump sum from '15. Followed by a bigger element from '15 at 68? FFS its not simple is it...:{

[rock34]

Cheers, thanks for answering that.

Al R - formerly Feu de Fer!

[Lima Juliet]

It's a little unclear for FTRS as it states that FAFPS will only pay out at or after the proposed 20/20 point. With some FTRS taking contracts at age 40 or above, does that mean working to a 20 year point or wait until age 65 when most FTRS retire age 60?!

If it is as before, where RFPS05 paid 1/70th of final pensionable salary and FAFPS pays 1/47th of final pensionable salary, then I am very much "quids in" and my pension at 60 for my FTRS time will be £16k under FAFPS whereas under RFPS05 it would be £10.7k!

I managed to answer this via the excellent videos posted by the FAFPS Team on the Defence Intranet. Basically, anyone, including those that have not done 20yrs, will get an immediate "full career pension" if they serve to age 60yrs (the NPA). However, there is no lump sum unless you commute under the surrender £1 pension for £12 lump sum rule (1:12 rule).

Anyhoo, I ran the numbers for my current 2005 pension over FAFPS for the same period and for those that go the distance to age 60 it should be good news:

2005 Pension for me would realise £10.7k pension and a £32.1k lump sum at age 60

FAFPS Pension for me would realise £13k pension and a £36k lump sum (under a 1:12 commute) at age 60

So, happy days for some :ok: for others not :(

I then thought, hang on, they're supposed to be saving money. How are they doing this? Well fewer make it to the "final post" of 60 than leave at 40-something, and the majority will get paid less during the transition period so it will save in the short/medium term - that is what the Govt is trying to do.

I must admit, I also like the idea of flexible lump sum payments as most don't need lump sums, but a regular income at or above age 60 (kids have left and house is probably all but paid for).

LJ

[kweelo]

Al -


there are clearly a lot of confused people out there, including myself and I don't expect you to answer everyone's personal circumstance here. I have today joined the FPS in the hope that after the consultation period they will hopefully be able to give me (and others!)some clear guidance. I definitely need it!

I am an OR on AFPS 75 and on FAFPS changeover will have completed 28 yrs of my LOS 30. Having read the consultation document today and again being just as confused reading through that, I was heartened to read that the accrued rights you have banked are save.

To that end, I read in to it (or maybe hoped!) that I will have banked 28/30ths of my AFPS 75 pension and that at the end of my 30 years’ service I will be able to collect my gratuity (having commuted), reduced immediate pension and that at age 55 my pension will revert to its original value, including CPI rise- as that is what I would have 'banked' under the old scheme and that 2/30ths FAFPS will be payable to me at age 60, as per the BBC website article yesterday. I haven't read or indeed have missed possibly that the portion earned under the new scheme will be paid at the new state pension age of 68, which you have suggested?

[Al R]

Kweelo,

Firstly, do you qualify for transitional protection - are you within 10 years of 75's normal pension age of 55?

"The Government has offered transitional protection for all members of public service pension schemes who were within ten years of their respective scheme’s Normal Pension Age (NPA) on 1 April 2012. The Armed Forces Pension Schemes 1975 and 2005 (AFPS 75 and AFPS 05) and the Full Time Reserve Service Pension Scheme 1997 (FTRS 97) (Full Commitment) have a NPA of 55. This means that if an individual is a member of AFPS 75, AFPS 05 or FTRS 97 (FC) and was aged 45 or over on 1 April 2012 (i.e. born on or before 1 April 1967), they will remain in their current pension scheme and their benefits will be unaffected."

You will have served beyond your gratuity/IP point of AFPS 75 and beyond the FAFPS EDP point. As you say, you will get 28/30 of AFPS 75 benefits and you should also get tax free cash and EDP benefits from FAFPS (which involves a commutation also, at a rate of 12:1).

At 55, your pension will be increased by the retrospective and compounding effect of CPI since you left and when you reach your Deferred Pension age (67/68 for you?), your FAFPS annual pension will increase. At this point, you can commute some of your newly increasing annual FAFPS Pension to generate a lump sum.

Calculating your State Pension age : Directgov - Pensions and retirement planning (http://www.direct.gov.uk/en/pensionsandretirementplanning/statepension/dg_4017919)

[blagger]

My 38/16 is a few weeks before the 1 Apr 15 date luckily. However, I think I'm right in saying people like me would have to do at least 4 years of FAFPS to get to 20 years to get anything extra than the AFPS75 16 year IP before Age 68??

I'm also wondering how taking an option vs PVR will work - if my 16 years of AFPS75 is frozen will the frozen amount be reduced by going on PVR post my option point as I leave on PVR rates? This effect used to be balanced by the AFPS75 IP growing with extra years of service but if it freezes it can't grow?

[Albert Another]

Thanks to all those posting here who are helping to answer questions. I’m going to take the weekend to Deliberate, Cogitate and Digest the outlined new pension scheme. The examples in the outline document are very helpful. However, it would have been useful to have some examples for personnel leaving at aged 55 formally under AFPS 75. My initial feelings and questions are:

AFPS 75, PAS, planning to retire at 55 after 35 years of service.

1) The FAFPS EDP monthly income and lump sum may not be as bad as first feared (lots of maths need over the coming days to confirm). The 1/47th accrual rate is good news.

2) I understand I have the ability to take the FAFPS pension at 55 which was a critical requirement for me. Although the amount it will be actuarially reduced is still a big unknown to the financial impact of leaving at 55. I do not plan to stay until 60 because at 60 I am considerably less employable in civi street and after 35 year of service I desire a less unpredictable lifestyle.

3) My second major concern I have is if I had to PVR prior to age 55 would I have to wait until 66/67/68 to get the full benefits from the FAFPS? Currently under AFPS 75 I would receive the full pension immediately. For example if I had to PVR at aged 50 would I now have to wait 16+ years for the full FAFPS benefits? This is a huge financial loss and a lot worse than for those on AFPS 05 as I think they already had to wait until age 65. This basically creates an unwanted stay until 55 or go before 2015 decision.

If anyone can clarify or expand on these points it would be much appreciated.

[Al R]

Albert,

3) My reading (still reading it and absorbing it too) is that if you leave at 50 (eg) then although you get '75 benefits straightaway, you would have to wait until 66/67/68 for the full FAFPS income. Unless you have also ticked the 20/40 (which you will have I assume!) box for FAFPS in which case you'd also get FAFPS tax free cash/EDP when you leave at 50 (and more commutable FAFPS income at 66/67/68).

[Just This Once...]

Under current rules you can leave with 6 month notice, with no financial or PVR pension abatement if:

i. You are aged 50 or above

and

ii. Have completed 30 years of service.

The new FAFPS seems to undermine this right but it is one of the issues that span both pensions and the new ToS under the New Employment Model.

Another big question I guess.

[Lima Juliet]

Albert

I think a lot will hang on the New Employment Model (NEM). If we retain age 55 for a full career pension and retirement then you won't have to go past 55 (I think this is unlikely though and the NPA of 60 is going to be set). I suspect it will be go to age 60 (which is likely under NEM) to get a FAFPS pension without doing 20 years and don't forget that you will get an immediate pension if you are unable to continue service under medical grounds with a disability pension regardless of how many years you have served (with the same rights as AFPS05).

If it were me I would serve another 5 years past 55yrs to get a full career pension on FAFPS plus my protected AFPS75/05 pension, rather than leave at 55 and have to wait 17 years for the rest. But that is my opinion.

LJ

[Backwards PLT]

Albert

I am looking at a similar scenario, but the difference is I will welcome an extension to 60. As I understand it, the working until 60 has not been categorically stated yet, although it is implied, but I suspect that will come out when NEM is announced.

The reason that I welcome an extension to 60 is that it means that I don't need to get another job at 55 - I can retire properly at 60. Those extra 5 years on a good wage and an extra 5/47 of approx 75k (top tier PAS, averaged etc etc) = 8k /annum extra pension make all the difference.

EDIT: One question I do have, assuming a retirement at 60 is introduced - the current info states that benefits under AFPS 75/05 will be paid when you would expect them to be ie no change. Does this mean that I would still be in the military, working to 60 but get a lump sum at 55 and my AFPS 75 pension??? Or could I defer it to 60 and have it "actuarily adjusted"?

[Albert Another]

Thank you for the replies to my post.

Al R: That’s the way I read it as well. ‘Under existing regulations an actuarially reduced pension is payable within 5 years of the current NPA’. That means if the NPA goes up to age 60 then if you leave at 50 you are outside the 5 years so you only get a FAFPS tax free cash/EDP (and more FAFPS income at 66/67/68!!!). That is a very large change in conditions for those on AFPS 75. If the NPA stays at 55 then you could still leave at age 50 with an immediate full pension (actuarially reduced). Hence, the stay until 55 or go by 2015 quandary.

Leon: I read it slightly differently. In the Key Points on page 8 and under Full Pension Entitlement on page 11 it says ‘Under existing regulations an actuarially reduced pension is payable within 5 years of the current NPA’. So if the NPA stays at 55 the pension is not actuarially reduced. However, if the NPA goes up to 60 I can still leave at age 55, get an immediate full pension but it will be actuarially reduced (a low reduction rate is crucial though).

Backwards PLT: The NPA is a critical factor. I have not heard any timelines for when it will be set. Obviously it needs to be fairly soon so we can all make informed choices. It then must not change for at least 25 years, as any later rise to say 65 would, be catastrophic to any financial / life plans.

[Reverend 71]

Normal Pension Age of 60

The move to a Normal Pension Age of 60 for the uniformed services was recommended by Lord Hutton and this was accepted by the Government last year. Therefore, the Normal Pension Age for FAFPS will be 60. How single Service TCOS will change to accommodate this is not certain and will be part of the NEM process.

[BlindWingy]

Maths was never my strong point, but I’ve had a go with the calculator....

AFPS75? Leaving as planned at 16/38? Average UK life expectancy of 80 years?
Historically, you would have collected about £565 064 post 38/16 point. (Ignoring CPI)

Now, if you leave as planned after the changeover...you get your accrued rights( eg X/16ths of the figure above) and the rest at NPA age 60. So you will lose:
If 1 year left at changeover : -£2354 from Terminal Grant-£785/year for 22 years (age 60) = £19624

If 3 years left at changeover: -£7062 from Terminal Grant-£2355/year = £58 872

If 5 years left at changeover: -£11770 from Terminal Grant-£3925/year = £98 120
Anybody have issues with these calculations?

[alfred_the_great]

On the basis '15 was introduced on the premise that '75 and '05 were unaffordable, that sounds like it's doing the job it was designed to do.

[BlindWingy]

Tell that to somebody who's heading to Afghanistan.

[FJ2ME]

Does anyone know if the new pension rule of 'from first day of paid service' in the armed forces' would take account of service as a VR before joining full time? If so, those facing a short fall between 2015 and 38/16 point may qualify for 20 years service under FAFPS at their normal 38/16 point by adding time served as a Volunteer Reservist before joining as a regular-ie University sponsored cadets, TA members, or VGS VRs...as were committed to employment, then it really should qualify and all those sorts of people were in 'paid service'...food for thought...

[81mm]

Or time spent as a NCO before commission / service change?

[Voxpop]

Only reserve service which counted in AFPS 75 (prior to 6 April 2005) or in RPFS can be counted. For the former you had to have left with an immediate or preserved AFPS pension and been called out for a national emergency or mobilised under S32, 43,52, 54 or 56 or the Reserved Forces Act 1996 (or corresponding section of the 1980 Act). For the latter the provision of the 1996 Act apply.

In 2006-ish the MOD fought and won a prolonged legal challenge about the non-pensionable status of reserve service which did not meet the above test and I cannot see them conceding now that it can count for pension.

Readers who want their position under the new scheme setting out for them in plain language might like to visit the Forces Pension Society website (Forces Pension Society - Fighting for the Forces and their Families (http://www.forpen.co.uk)) and join us on line. Our Help Desk is experienced in demystifying pensions for our members and, of course, having been closely monitoring the development of the new scheme, understand what is proposed.

[Al R]

Forces Pensions Society et al, keeping the pressure on.

Call for rethink over officer pensions - Echelon Wealthcare (http://www.echelonwealthcare.co.uk/?p=2302)

[downsizer]

It's not just officers missing out. I know of several JRs made redundant just before an IP. In one case 24hrs service short.

[Al R]

Agreed. The terms are slightly different though.

An instance like that can have absolutely no justification; talk about knowing the price of something and the value of nothing.

[Lima Juliet]

I posted this a few years ago and now the Armed Forces Calculator now includes FTRS I am pleased to say my prediction below is correct! (Very happy boy indeed!)

Quote:
It's a little unclear for FTRS as it states that FAFPS will only pay out at or after the proposed 20/20 point. With some FTRS taking contracts at age 40 or above, does that mean working to a 20 year point or wait until age 65 when most FTRS retire age 60?!

If it is as before, where RFPS05 paid 1/70th of final pensionable salary and FAFPS pays 1/47th of final pensionable salary, then I am very much "quids in" and my pension at 60 for my FTRS time will be £16k under FAFPS whereas under RFPS05 it would be £10.7k!
Endqoute:

I managed to answer this via the excellent videos posted by the FAFPS Team on the Defence Intranet. Basically, anyone, including those that have not done 20yrs, will get an immediate "full career pension" if they serve to age 60yrs (the NPA). However, there is no lump sum unless you commute under the surrender £1 pension for £12 lump sum rule (1:12 rule).

Anyhoo, I ran the numbers for my current 2005 pension over FAFPS for the same period and for those that go the distance to age 60 it should be good news:

2005 Pension for me would realise £10.7k pension and a £32.1k lump sum at age 60

FAFPS Pension for me would realise £13k pension and a £36k lump sum (under a 1:12 commute) at age 60

So, happy days for some for others not

I then thought, hang on, they're supposed to be saving money. How are they doing this? Well fewer make it to the "final post" of 60 than leave at 40-something, and the majority will get paid less during the transition period so it will save in the short/medium term - that is what the Govt is trying to do.

I must admit, I also like the idea of flexible lump sum payments as most don't need lump sums, but a regular income at or above age 60 (kids have left and house is probably all but paid for).

LJ :ok: