AFPS: Hutton's Review of Public Sector Pensions approved.

[Party Animal]

Okay - hands up - thicko aircrew here. Can we attempt to put this in plain language? Or even, I will throw in a few generalisations for comment/clarification and we can debate further. So ignoring redundancies, PA spine and AFPS 05:

As it currently is (I think) - Individual A is 45 years old tomorrow and has served since the age of 21. Let’s just say if he/she left now, they would get a pension of 20k. This would remain flat until they reached 55 and then the 20k would be index linked. But, they could also play the pension calculator game and see what pension they would get if they were 46, 47 ...etc up to 55 years of age such that if hypothetically, they were 55 tomorrow, they would get 30k, that is automatically index linked.

Now put this into the new equation:

Individual A is 45 tomorrow with a potential 20k pension (if they left now) but decides to stay to 55. The new pension scheme kicks in the next day. For the next 10 years, pension accrual will be based on the average income earned over those 10 years until they retire at 55. At this stage does Individual A get:

1. 20k plus 60k lump sum until the age of 60 and then a pension rise with the additional 10 years of average earnings and possibly another lump sum. Or:

2. Absolutely nothing until aged 60 and then a split pension based on the 20k preserved and 10 years average pay. Or:

3. As per 2 but paid straight from the age of 55.

Any offers or guesses. Of course depending on the date the new rules kick in, could we also see someone reach 55 and retire a month before that date under the current T’s and C’s that we are familiar with, followed by the guy who reaches 55 one month later and gets absolutely nothing till they are 60? Or am I missing something here?