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Old 13th Nov 2011, 08:53
  #37 (permalink)  
Voxpop
 
Join Date: Aug 2010
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Dynamising

The 75 scheme works on pension codes and pension codes are linked to pay. Thus when inflation runs ahead of pay rises, like now, a pension trough occurs.

When MOD were designing AFPS 05 the Forces Pension Society put a lot of pressure on MOD to build in a mechanism which would afford some degree of protection against pension troughs.

In the 05 scheme you work out pension based on Final Pensionable Pay. That is worked out by going back three years, inflating pay more than a year ago by inflation, and looking at which are the best 365 days consecutive pay. In 'normal' times, the best 365 days pay will be the final year - but these are not normal times.
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