Final-salary Pension under threat!
Consider the words used very carefully.
What Hutton didn't say is that military pensions will be left alone.
What Hutton did say,is that it wasn't fair to make us start contibuting whlist we are fighting in Afghanistan.
Subtle distinction I accept, but I wouldn't make long term plans that don't involve pension contributions post 2014-15.
What Hutton didn't say is that military pensions will be left alone.
What Hutton did say,is that it wasn't fair to make us start contibuting whlist we are fighting in Afghanistan.
Subtle distinction I accept, but I wouldn't make long term plans that don't involve pension contributions post 2014-15.
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In a briefing a few years ago, I remember not when or by whom, it was floated that the average age at which the mil pension ceased to be claimed was 62 (may have been in response to a FoI question?). Anyone else heard anything along these lines?
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NUFC1892
Sounds like someone was being creative with statistics - maybe including data way back from the dawn of military pensions???
It does not seem to make any sense in the present context, especially as widows (or widowers) increasingly recieve a proportion of the pension in the advent of the pension holders prior demise.
I would have thought nowadays the figure would be closer to 80, but that is nothing more than an educated guess.
On a different note, I served through the pension change from AFPS 75 to AFPS zero whatever, and whilst, like many, I fiddled with the various calculators and guides to suss out the financial consequences, I was always far more interested in the affect a change was likely to have on my back up early exit strategy.
I am a massive believer in freedom of choice and I was always comforted by the arrangements in AFPS 75 which gave me a guaranteed option from age 38 - which is an absolutely ideal time to start a second career.
If I was still in, as many of you are, this is the element I would be watching most closely and the element I suspect may be subject to the the most significant change. As I understand the current deal (AFPS05??) with its EDP, still has a fairly good yellow and black handle component and that would from the backstop for any worse case scenario I would be planning.
Just a thought.
Sounds like someone was being creative with statistics - maybe including data way back from the dawn of military pensions???
It does not seem to make any sense in the present context, especially as widows (or widowers) increasingly recieve a proportion of the pension in the advent of the pension holders prior demise.
I would have thought nowadays the figure would be closer to 80, but that is nothing more than an educated guess.
On a different note, I served through the pension change from AFPS 75 to AFPS zero whatever, and whilst, like many, I fiddled with the various calculators and guides to suss out the financial consequences, I was always far more interested in the affect a change was likely to have on my back up early exit strategy.
I am a massive believer in freedom of choice and I was always comforted by the arrangements in AFPS 75 which gave me a guaranteed option from age 38 - which is an absolutely ideal time to start a second career.
If I was still in, as many of you are, this is the element I would be watching most closely and the element I suspect may be subject to the the most significant change. As I understand the current deal (AFPS05??) with its EDP, still has a fairly good yellow and black handle component and that would from the backstop for any worse case scenario I would be planning.
Just a thought.
Last edited by The Old Fat One; 8th Oct 2010 at 06:57.
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Sounds like someone was being creative with statistics - maybe including data way back from the dawn of military pensions???
It does not seem to make any sense in the present context, especially as widows (or widowers) increasingly recieve a proportion of the pension in the advent of the pension holders prior demise.
It does not seem to make any sense in the present context, especially as widows (or widowers) increasingly recieve a proportion of the pension in the advent of the pension holders prior demise.
When I got a pensions briefing at IOT, in the very early 80s, the chap giving the brief (not regular RAF, something like an RAFBF rep I seem to remember) said that the average age of demise on someone retiring from the RAF was 58! So, within 3 years of leaving over 50% of retirees were dead! This figure had a profound impact on me - which is why I remember it still today!
I can't say that I was surprised. At the time the RAF was much more a way of life or vocation than a "job". People lived much more in quarters, often right up to retirement (probably having been on several overseas tours - no point in buying in UK yet, etc), socialized almost exclusively in the Mess and with other RAF personnel on camp, etc. In short they were institutionalised! Especially when you consider that people retiring at 55 then (in the early 80s) had joined the RAF in the 1950s
Then, come the age of 55, they were thrown out the main gate, with a "never darken our door" again attitude - no veterans organization as such, other than the British Legion. They often moved far from where they had been based, into a small cottage or house. The wife (largely a male airforce then) carried on with all the things she had got on with while hubby had been at work, away on exercise, etc. The husband had nothing to do, and, unless he found a new outlet, whithered on the vine while reliving memories of his time in the mob, and popped his clogs pretty soon thereafter....
Thankfully today things are different!
I can't say that I was surprised. At the time the RAF was much more a way of life or vocation than a "job". People lived much more in quarters, often right up to retirement (probably having been on several overseas tours - no point in buying in UK yet, etc), socialized almost exclusively in the Mess and with other RAF personnel on camp, etc. In short they were institutionalised! Especially when you consider that people retiring at 55 then (in the early 80s) had joined the RAF in the 1950s
Then, come the age of 55, they were thrown out the main gate, with a "never darken our door" again attitude - no veterans organization as such, other than the British Legion. They often moved far from where they had been based, into a small cottage or house. The wife (largely a male airforce then) carried on with all the things she had got on with while hubby had been at work, away on exercise, etc. The husband had nothing to do, and, unless he found a new outlet, whithered on the vine while reliving memories of his time in the mob, and popped his clogs pretty soon thereafter....
Thankfully today things are different!
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The Country would soon be bankrupt if lived to draw the pensions for as long as the gentleman in the middle...
]
Not sure if he got a pension from the military though, but imagine 22 years service to get a pension for 70+ years!
]Not sure if he got a pension from the military though, but imagine 22 years service to get a pension for 70+ years!
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If he bought himself an annuity, he would certainly have won the 'bet'! I'm reminded of the Labour (?) politician who said recently that he would like everyone to earn more than the average national wage..
2.10 However, as with the uniformed services, because of protections given to existing members in respect of future service, it will be some time before the full impact of the reforms appears in employer contribution rates.
We may well have been let off the hook - for now. But quite frankly, looking at the numbers involved in some of the other pension schemes - health, education etc, I think the Armed Forces scheme is fairly small fry.
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My understanding from the announcements is that they will affect the pensions of those who join in the future. I believe that is the case in the other public services who may not be as protected as us.
It makes sense. I'm not going to start to panic just yet!
But, can any of us see the AFPS continuing for new entrants past say the next decade??
It makes sense. I'm not going to start to panic just yet!
But, can any of us see the AFPS continuing for new entrants past say the next decade??
only affect the pensions of those who join in the future
or until they change their ToS due to promotion, re-engagement etc.
There may well be conditions tied to promotion, course amortization, re-engagement etc etc. May be difficult to avoid without bailing out.
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Think about that, almost no-one serves on just their orginal engagement.
There may well be conditions tied to promotion, course amortization, re-engagement etc etc. May be difficult to avoid without bailing out.
There may well be conditions tied to promotion, course amortization, re-engagement etc etc. May be difficult to avoid without bailing out.
Some advice which worked well for me for 27 years.
Take responsibility for your own career. Do your homework and know the facts regarding your terms of service. Treat crewroom scuttlebutt, barrack room lawyers and chain of command bull with equal scepticism. As pointed out above, things change - quickly and frequently. Keep the big picture in mind and make the changes work for you.
An example of two real NCO aircrew (many were in the same boat)...
Circa 1990 and cue the option to sign onto the new terms of service or retain "reserved rights".
Young Sergeant A read the blah, went to the interview and thought screw this what I have I hold - I'm sticking with reserved rights. Thus confiming him his original financial terms of service, but rulling out the prospect of further promotion (even though he would get the money when due). PS He had already signed on since in those days NCO aircrew were signed up to 55 in their first tour.
Young Sergeant B went with the command plan and opted into competitive promotion.
Things change....rules change....circumstances change.
Not so young Sergeant A is promoted, without loss of rights. How did that happen? Answer...operational necessity. In other words, our train set, we do what we want.
Much older, unable to get promoted and extremely bitter Sergeant B leaves.
Fast forward to 2010. Young at heart Master WSOp A has played his hand with style and panache...well done that man.
PS Neither one of them was I.
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When the individual NCA trades were terminated a few years ago my understanding is that all bar one rejected the new (you will not promoted because we want to try and achieve a rank pyramid) terms of service. [The one already had an IOT entry date].
Yet within five years the system had reigned in almost everybody through further service / promotion / PA spine. They know that they can change terms of service quite radically and get away with it.
If this speculation is true, there must be some fairly A Level staffing going on to dispose of the aircrew without portfolio which now includes Nav - AEOp - Flt Eng and quite possibly ALM (FW c130/vc10 & rotary) and some pilots. In short, there is no job security whatsoever in the 21st century UK Armed Forces and therefore morale is destined to descend further still.
I think a change of career to Debt Advisor, Undertaker, or Divorce Lawyer is on the cards because they will always be in demand.
Yet within five years the system had reigned in almost everybody through further service / promotion / PA spine. They know that they can change terms of service quite radically and get away with it.
If this speculation is true, there must be some fairly A Level staffing going on to dispose of the aircrew without portfolio which now includes Nav - AEOp - Flt Eng and quite possibly ALM (FW c130/vc10 & rotary) and some pilots. In short, there is no job security whatsoever in the 21st century UK Armed Forces and therefore morale is destined to descend further still.
I think a change of career to Debt Advisor, Undertaker, or Divorce Lawyer is on the cards because they will always be in demand.
I don't own this space under my name. I should have leased it while I still could
the RAF was much more a way of life or vocation than a "job". People lived much more in quarters, often right up to retirement
. . .
The wife (largely a male airforce then) carried on with all the things she had got on with while hubby had been at work, away on exercise, etc. The husband had nothing to do, and, unless he found a new outlet, whithered on the vine while reliving memories of his time in the mob, and popped his clogs pretty soon thereafter....
Thankfully today things are different!
. . .
The wife (largely a male airforce then) carried on with all the things she had got on with while hubby had been at work, away on exercise, etc. The husband had nothing to do, and, unless he found a new outlet, whithered on the vine while reliving memories of his time in the mob, and popped his clogs pretty soon thereafter....
Thankfully today things are different!
Also watched one guy working flat out for the Service in 1974 right through into his terminal leave - very sad.
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Vecvec,
My pensions experience is not so much Trustee based, but rather, using AFPS as part of an overall investment and retirement strategy (as an IFA). And although I know AFPS inside out (I have one!), I wouldn't claim to know specifically how the MoD and Parliament is going to change it in the future.
Having said that, my working days at the moment seem to revolve around JSP 764, offsetting AFPS AVC calculations and The Armed Forces (Pensions and Compensation) Act 2004. So, talking of which, and in keeping with your question, it was amended in 2004 to read (rather opaquely and ominously)..
The cynic would suggest of course, that in 2004, everyone already quietly knew that the principle of the Public Sector Final Salary pension was fast becoming unsustainable. In general terms, it is always in everyone's best interests to start taking responsibility for their own financial futures anyway, and to create a personal financial plan - and not to wait for events to arrive from a great height at their door (if in doubt, recce out..?).
PS: Diablo,
Add to that list, toilet paper manufacturer..?
My pensions experience is not so much Trustee based, but rather, using AFPS as part of an overall investment and retirement strategy (as an IFA). And although I know AFPS inside out (I have one!), I wouldn't claim to know specifically how the MoD and Parliament is going to change it in the future.
Having said that, my working days at the moment seem to revolve around JSP 764, offsetting AFPS AVC calculations and The Armed Forces (Pensions and Compensation) Act 2004. So, talking of which, and in keeping with your question, it was amended in 2004 to read (rather opaquely and ominously)..
(1) The power of the Secretary of State to modify an armed forces pension scheme may not on any occasion be exercised in any manner which would or might adversely affect any entitlement, accrued rights or pension credit rights of any member of the scheme acquired before the power is exercised unless—
(a) the consent requirements are satisfied in respect of the exercise of the power on that occasion in that manner, or
(b) the scheme is modified in the prescribed manner.
(2) The consent requirements are those prescribed for the purpose of obtaining the consent of members of the scheme to its modification.
(3) In this section—
(a) the consent requirements are satisfied in respect of the exercise of the power on that occasion in that manner, or
(b) the scheme is modified in the prescribed manner.
(2) The consent requirements are those prescribed for the purpose of obtaining the consent of members of the scheme to its modification.
(3) In this section—
- “prescribed” means prescribed by an order under section 1,
- “accrued rights”, “entitlement”, “member” and “pension credit rights” have the same meanings as in Part 1 of the Pensions Act 1995 (c. 26).
PS: Diablo,
Add to that list, toilet paper manufacturer..?
