New Pension Scheme
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VVHA
I assure you that my pension won't be anywhere near 30K, on either scheme. If yours will, then perhaps its not surprising that you are failing to see the point.
Regards
Ginseng
Regards
Ginseng
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confused again
As per reply from Ginseng, there is no simple way to understand this.
Tried http://www.mod.uk/issues/pensions/#2 and the last item is about the proposed changes. Still confused so will wait for the OTT package and hope that it is written for the customer rather than in admin speak, but not holding my breath.
Tried http://www.mod.uk/issues/pensions/#2 and the last item is about the proposed changes. Still confused so will wait for the OTT package and hope that it is written for the customer rather than in admin speak, but not holding my breath.
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I really dont understand what your beef is. Are you telling me that you are unhappy with the AFPS? Whats wrong with it? Many financial experts will tell you that the AFPS is one of the best around )(mainly as it is non-contributry).
If you don't like the AFPS then take a look at the pension schemes of other companies.
I'll quote from a recent interview....
"Many people have been left with a pensions shortfall because of recent problems in the pensions market, according to the Association of Consulting Actuaries (ACA).
ACA's recent survey suggests that nearly ninety per cent of all final salary pension schemes are in deficit, meaning that the total shortfall of these schemes has now risen to more than Ł130 billion.
Speaking to the BBC, ACA's chairman, Adrian Waddingham, said: "Lots of things have gone wrong for pensions schemes recently, including the stock market collapse and low interest rates.
"So British pension funds, many of them, most of them, have shortfalls."
Many other commentators have blamed the shortfalls on lower investment returns and longer life expectancy.
The survey found that it seems to be employers who have to bear most of the extra cost. Employees are now paying only 1.2 per cent more, while employers' contributions have increased by five per cent on average." So, there you have it. You either opt for a pension with BA, Squeasy Jet or any other airline. You can opt to work bor British waste of space or wastelands....OR you can sit with the AFPS, safe in the knowledge that providing there is a defence Budget then your Pension is safe and sound.
If you don't like the AFPS then take a look at the pension schemes of other companies.
I'll quote from a recent interview....
"Many people have been left with a pensions shortfall because of recent problems in the pensions market, according to the Association of Consulting Actuaries (ACA).
ACA's recent survey suggests that nearly ninety per cent of all final salary pension schemes are in deficit, meaning that the total shortfall of these schemes has now risen to more than Ł130 billion.
Speaking to the BBC, ACA's chairman, Adrian Waddingham, said: "Lots of things have gone wrong for pensions schemes recently, including the stock market collapse and low interest rates.
"So British pension funds, many of them, most of them, have shortfalls."
Many other commentators have blamed the shortfalls on lower investment returns and longer life expectancy.
The survey found that it seems to be employers who have to bear most of the extra cost. Employees are now paying only 1.2 per cent more, while employers' contributions have increased by five per cent on average." So, there you have it. You either opt for a pension with BA, Squeasy Jet or any other airline. You can opt to work bor British waste of space or wastelands....OR you can sit with the AFPS, safe in the knowledge that providing there is a defence Budget then your Pension is safe and sound.
vec......
First of all, the Armed Forces Pension Scheme is effectively contributory. Yes, you don't see the money coming out of your monthly pay packet, but the Armed Forces Pay Review Board take the value of the pension into account when determining pay. In theory at least, if our pension scheme was worse than it currently is our pay would be higher!! However, I doubt that would actually be the case in practice!!!
As to what people's beef is..... Well a large part of it is you!!! Nobody is saying that the AFPS, either old or new, is rubbish. What people are trying to do is pass on what knowledge they have, their sources of information etc, to enable the people who are eligible to make a sound decision as to whether or not to transfer to the new scheme. Most contributors to this thread are doing so in an attempt to actually help their fellow man.
By contrast your comments contain no detail, seem to be largely your opinion or quotes from headlines rather than being based on verifiable facts... and when your comments are queried and all else fails you seem to resort to 'I'm all right jack... life in the navy is rosey.... it's worse out in civy street' etc.
Your comments are of little help to anyone, and seem to be largely about flattering your own ego and 'hearing' the sound of your own voice. To many people this proves somewhat annoying, but perhaps that is the intended effect?
First of all, the Armed Forces Pension Scheme is effectively contributory. Yes, you don't see the money coming out of your monthly pay packet, but the Armed Forces Pay Review Board take the value of the pension into account when determining pay. In theory at least, if our pension scheme was worse than it currently is our pay would be higher!! However, I doubt that would actually be the case in practice!!!
As to what people's beef is..... Well a large part of it is you!!! Nobody is saying that the AFPS, either old or new, is rubbish. What people are trying to do is pass on what knowledge they have, their sources of information etc, to enable the people who are eligible to make a sound decision as to whether or not to transfer to the new scheme. Most contributors to this thread are doing so in an attempt to actually help their fellow man.
By contrast your comments contain no detail, seem to be largely your opinion or quotes from headlines rather than being based on verifiable facts... and when your comments are queried and all else fails you seem to resort to 'I'm all right jack... life in the navy is rosey.... it's worse out in civy street' etc.
Your comments are of little help to anyone, and seem to be largely about flattering your own ego and 'hearing' the sound of your own voice. To many people this proves somewhat annoying, but perhaps that is the intended effect?
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The 75 AFPS is good, but not as good as the Police or anywhere near the pension that the snout-in-trough MPs trouser.
The new scheme is (from my reading) disadvantageous to the majority of personnel who fulfil an 18-year engagement. There will be a small number of people better-off ie. those on 35 year engagements (warrant officers/squadron leaders) and above but since when did the command chain ever put the conditions of service of the multitude before the elite?
The consultation programme embarked on by MoD was a disgrace, as pointed out by the Commons Defence Committee, who raised the absurdity of each unit receiving perhaps 10 copies of the leaflet. Compare this to the lovely RAF History AP3003, of which there are more than enough copies for one each!
So - not good for most, better for a few.
The new scheme is (from my reading) disadvantageous to the majority of personnel who fulfil an 18-year engagement. There will be a small number of people better-off ie. those on 35 year engagements (warrant officers/squadron leaders) and above but since when did the command chain ever put the conditions of service of the multitude before the elite?
The consultation programme embarked on by MoD was a disgrace, as pointed out by the Commons Defence Committee, who raised the absurdity of each unit receiving perhaps 10 copies of the leaflet. Compare this to the lovely RAF History AP3003, of which there are more than enough copies for one each!
So - not good for most, better for a few.
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Tee Hee...quality. If you think that the MP's pension and the police pension is better then........only one answer to that isn't there?
I think the RAF may have missed a trick with only getting 10 leaflets per unit. Down here in fairly land we got one each.
I think the RAF may have missed a trick with only getting 10 leaflets per unit. Down here in fairly land we got one each.
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I think the RAF may have missed a trick with only getting 10 leaflets per unit. Down here in fairly land we got one each.
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It wasn't a leaflet, but a full-sized A4 glossy brochure report. On the Stn on which I was serving at the time, I am only aware of one copy being sent to each Sqn Boss, for dissemination of the contents. As far as I could ascertain, most sat in the bottom of in-trays and may never have made it to the crewrooms. I was only aware of its importance because I had chanced on the whole review process while (legitimately!) surfing the intranet. The general view at the time, amongst the few I spoke to who had even heard of it was along the lines of "something for the future kids; it won't affect me". Touchingly naieve. No wonder the whole question of whether additional pay should become pensioned was kissed-off on the basis that "there is no significant appetite for additional pay to be pensioned". As far as I can recall, this conclusion was drawn on the basis of replies from about 50 people, almost none of whom were aircrew. But the system claims that you were consulted. Sad, isn't it?
Regards
Ginseng
Regards
Ginseng
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Yes Ginseng, it's very sad.
What's even worse is that the very senior wheels just let it happen - I still wonder if they understand what impact it will all have on the morale of their "middle management". But then again - what's new?
I have to admit that, for a time, I was quite excited by the prospect of AFPS 05 - I thought I'd won the jackpot. But then I saw the full horror of what happens if I elect to leave at any time before I'm 55!
.... and then I saw the new redundancy terms that I would automatically sign up to if I transfer to AFPS 05.
So the way I see it is:
If I join AFPS 05, I get a big increase in my pension when I retire at 55.
But if elect to leave even a couple of months before I'm 55, I loose 25% of my gratuity and 25% of my pension for 10 years. If I leave before I'm 50 I loose another 25% of my gratuity and 50% of my pension until I'm 55! But of course - it isn't really a pension is it - so that's OK then. [And another thought has just occured to me - As it's not a pension, I wonder how easily they can change the terms of the Early Departure Payment in the future?]
Mind you, if they choose to make me redundant, I loose on the redundancy payment as well!
I thought my decision about joining AFPS 05 would be easy - but now I'm not so sure. It appears to me that the overall impact of all of this is to make employment in the Armed Forces much less secure than it was.
What's even worse is that the very senior wheels just let it happen - I still wonder if they understand what impact it will all have on the morale of their "middle management". But then again - what's new?
I have to admit that, for a time, I was quite excited by the prospect of AFPS 05 - I thought I'd won the jackpot. But then I saw the full horror of what happens if I elect to leave at any time before I'm 55!
.... and then I saw the new redundancy terms that I would automatically sign up to if I transfer to AFPS 05.
So the way I see it is:
If I join AFPS 05, I get a big increase in my pension when I retire at 55.
But if elect to leave even a couple of months before I'm 55, I loose 25% of my gratuity and 25% of my pension for 10 years. If I leave before I'm 50 I loose another 25% of my gratuity and 50% of my pension until I'm 55! But of course - it isn't really a pension is it - so that's OK then. [And another thought has just occured to me - As it's not a pension, I wonder how easily they can change the terms of the Early Departure Payment in the future?]
Mind you, if they choose to make me redundant, I loose on the redundancy payment as well!
I thought my decision about joining AFPS 05 would be easy - but now I'm not so sure. It appears to me that the overall impact of all of this is to make employment in the Armed Forces much less secure than it was.
Last edited by LFFC; 25th Jun 2005 at 10:27.
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I might be behind the drag curve of this discussion, but here is the actual statement (copied from the Parliament website) made in the House of Commons on Tue 21 Jun:
quote:
Armed Forces (Redundancy)
The Parliamentary Under-Secretary of State for Defence (Mr. Don Touhig): Current redundancy compensation terms for members of the regular armed forces have remained largely unchanged since the early 1970s and do not reflect changes to re-employment prospects or in wider Government policy for this area. Nor do they take account of the changes in benefit structure made under the new armed forces pension scheme. They have therefore been reviewed, working closely with the single services and I now wish to announce the outcome of that review.
The new terms are designed to compensate fairly those whose careers are prematurely shortened as a result of redundancy, and are to be used as part of any planned restructuring of the armed forces as announced by the Secretary of State for Defence from time to time. The Ministry of Defence has two schemes which provide normal early-leavers' benefits for the regular armed forces—one relating to the 1975 pension scheme and one to reflect the changes made to the value of mid-career benefits with the introduction of the new 2005 scheme. Despite the differences between these two schemes, the redundancy packages for each scheme will be broadly comparable.
21 Jun 2005 : Column 33WS
The new terms will continue to be made up of a one-off tax-free lump sum which, for those serving until or beyond mid-career, will be supplemented with an immediate pension paid under the armed forces pension scheme 1975 (AFPS 75) or income paid under the 2005 early departure scheme. The size of the lump sum and of the annual pension or income stream will, as now, vary according to length of service and pay. The 2005 terms will apply to all new entrants from 6 April 2005, but from 6 April 2006 for those who were in service on 5 April 2005 and who decide to transfer to the new pension scheme. The existing terms, as set out in AFPS 75, will remain unchanged until 31 March 2008 when the current drawdown in service manpower announced in July 2004 by the then Secretary of State is due to complete. They will then be replaced by new terms which, in particular, will defer the point at which the current very early immediate pension is paid. This can currently be paid from age 30 but in future only a lump sum will be paid at this very early age. To ease the transition, the replacement terms for AFPS 75 will be phased in over a five-year period from 1 April 2008 to 31 March 2013, after which the final terms will apply.
The new arrangements will provide the armed forces with cost-effective arrangements for managing any major drawdown in the level of service manpower and are expected to meet fully the manning needs of the armed forces. Although less valuable in a number of respects than the existing terms, they remain generous by wider standards, as befits the special demands of a career in the armed forces; they reflect changes in wider Government policy for public service schemes; and they are fair with respect to the relationship between level of compensation and length of service. Additional general information on the new arrangements is available on both the MOD's intranet and internet sites, while detail about the new terms will be made public when work on drafting the new rules has been completed.
I am today placing copies of the defence instructions and notices (DIN) on the new redundancy terms in the Library of the House. It is also being placed on the Ministry of Defence website at: [url]www.mod.uk/issues/pensions/
unquote
quote:
Armed Forces (Redundancy)
The Parliamentary Under-Secretary of State for Defence (Mr. Don Touhig): Current redundancy compensation terms for members of the regular armed forces have remained largely unchanged since the early 1970s and do not reflect changes to re-employment prospects or in wider Government policy for this area. Nor do they take account of the changes in benefit structure made under the new armed forces pension scheme. They have therefore been reviewed, working closely with the single services and I now wish to announce the outcome of that review.
The new terms are designed to compensate fairly those whose careers are prematurely shortened as a result of redundancy, and are to be used as part of any planned restructuring of the armed forces as announced by the Secretary of State for Defence from time to time. The Ministry of Defence has two schemes which provide normal early-leavers' benefits for the regular armed forces—one relating to the 1975 pension scheme and one to reflect the changes made to the value of mid-career benefits with the introduction of the new 2005 scheme. Despite the differences between these two schemes, the redundancy packages for each scheme will be broadly comparable.
21 Jun 2005 : Column 33WS
The new terms will continue to be made up of a one-off tax-free lump sum which, for those serving until or beyond mid-career, will be supplemented with an immediate pension paid under the armed forces pension scheme 1975 (AFPS 75) or income paid under the 2005 early departure scheme. The size of the lump sum and of the annual pension or income stream will, as now, vary according to length of service and pay. The 2005 terms will apply to all new entrants from 6 April 2005, but from 6 April 2006 for those who were in service on 5 April 2005 and who decide to transfer to the new pension scheme. The existing terms, as set out in AFPS 75, will remain unchanged until 31 March 2008 when the current drawdown in service manpower announced in July 2004 by the then Secretary of State is due to complete. They will then be replaced by new terms which, in particular, will defer the point at which the current very early immediate pension is paid. This can currently be paid from age 30 but in future only a lump sum will be paid at this very early age. To ease the transition, the replacement terms for AFPS 75 will be phased in over a five-year period from 1 April 2008 to 31 March 2013, after which the final terms will apply.
The new arrangements will provide the armed forces with cost-effective arrangements for managing any major drawdown in the level of service manpower and are expected to meet fully the manning needs of the armed forces. Although less valuable in a number of respects than the existing terms, they remain generous by wider standards, as befits the special demands of a career in the armed forces; they reflect changes in wider Government policy for public service schemes; and they are fair with respect to the relationship between level of compensation and length of service. Additional general information on the new arrangements is available on both the MOD's intranet and internet sites, while detail about the new terms will be made public when work on drafting the new rules has been completed.
I am today placing copies of the defence instructions and notices (DIN) on the new redundancy terms in the Library of the House. It is also being placed on the Ministry of Defence website at: [url]www.mod.uk/issues/pensions/
unquote
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LFFC
That is exactly why I set out on this crusade to make sure people were aware of the implications of what was coming, rather than being blinded by the headlines and dying of ignorance. If it's good for you then take it; but don't sell yourself short through lack of knowledge. For interest, see my calculation on the AFPS05 redundancy payments on the "More Cuts Coming" thread.
I even bore myself sometimes, but this is too important to gloss over.
Regards
Ginseng
I even bore myself sometimes, but this is too important to gloss over.
Regards
Ginseng
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Yes, I saw your calculations on the other thread thanks - but I'm still trying to understand all the aspects here. Think I'll carry on on this thread because the whole pensions/redundancy thing all seems so linked.
So have I got this right about the new redundancy scheme?
Supposing I join AFPS 05 then I'm made redundant in 2010 when I'm aged 49, I would get the new (somewhat reduced) capital payment and an EDP based on only 50% of the pension and gratuity to which I would have been entitled had I served until aged 55.
Sounds like a cunning plan to me Baldrick!
I suppose my real fear is that we develop a demographic bulge of aircrew on the PAS. This wouldn't be surprising because we've been offered such a big increase to our pensions if we stay until 55. I think we're already seeing the impact of that on assimilation. I suspect that the only way to deal with that will be with more redundancies targeted at the PAS.
So have I got this right about the new redundancy scheme?
Supposing I join AFPS 05 then I'm made redundant in 2010 when I'm aged 49, I would get the new (somewhat reduced) capital payment and an EDP based on only 50% of the pension and gratuity to which I would have been entitled had I served until aged 55.
Sounds like a cunning plan to me Baldrick!
I suppose my real fear is that we develop a demographic bulge of aircrew on the PAS. This wouldn't be surprising because we've been offered such a big increase to our pensions if we stay until 55. I think we're already seeing the impact of that on assimilation. I suspect that the only way to deal with that will be with more redundancies targeted at the PAS.
Last edited by LFFC; 25th Jun 2005 at 12:45.