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Just a quick reminder, contracting out of AFPS ends next month.

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Just a quick reminder, contracting out of AFPS ends next month.

Old 29th Mar 2016, 10:05
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Just a quick reminder, contracting out of AFPS ends next month.

It'll mean less going into the bank.

Bleakly and desperately scrambling around looking for any positives, the state pension is intended to provide more (plenty of time for that to be moved). And you'll not be paying more than civvies (this brings you into line with their NIC) so that makes it hard to complain specifically about this. Because after all, we are in it together.

But really, on the back of waves of token pay increases, it's going to be a very bitter pill to swallow and for some, it'll mean actively cutting back instead of downplaying aspirations (which is the effect of those 1% pay increases). Lots of folk still don't know about it so if you have a Twitter account, please feel free to retweet it.

Chapeau.

https://twitter.com/raf_ifa/status/714747727251443712
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Old 29th Mar 2016, 14:37
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Just tried the new state pension calculator, in beta. It's very good. If you're over fifty, give it a go - find out what the new state pension is estimated to give you, and when.

https://www.gov.uk/check-state-pension
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Old 30th Mar 2016, 10:50
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Quick question Al R; I am assuming that when we hit state pension age, post full military career, we get the full state pension on top of our military pension? In the case of the new state pension that is an extra £8093 at age 65 or 67 or 70 or whenever!
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Old 30th Mar 2016, 11:18
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Wokkamate,

AFAIK, you should get the state pension you have earned at state pension age. At present, a full state pension will require 35 years of qualifying NI payments but, I fully expect that level will increase to 50 qualifying years by the time that the state pension age reaches 70yo. Just my opinion

OAP
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Old 30th Mar 2016, 11:33
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It's interesting to see that even the so called 'experts' don't seem to understand what's going on with the new NICs and the new State Pension.

Paul Johnson, Director of the IFS, was recently quoted in the DT as saying;
“Members of final salary occupational pension schemes and their employers will now be paying the same NI contributions as the rest of us.
"Since they will be building up just the same state pension rights this can only be right.”
Well that might be correct for individuals just starting out on their working life, but if reports are correct, those already well into their careers will be hit very hard by the contracting out, with even a short period contracted out, a year or 2 for example, leading to a hefty reduction in the new pension seemingly out of proportion to the time spent contracted out. I for one expect to get nothing close to the widely touted State Pension of £155 or whatever it is in a couple of decades time because of the time spent in AFPS.

I wonder if he conveniently forgot about this or just didn't realise ... politics or incompetence, which noose would you rather hang yourself with Mr Johnson?
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Old 30th Mar 2016, 12:04
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Originally Posted by Melchett01
It's interesting to see that even the so called 'experts' don't seem to understand what's going on with the new NICs and the new State Pension.

Paul Johnson, Director of the IFS, was recently quoted in the DT as saying;


Well that might be correct for individuals just starting out on their working life, but if reports are correct, those already well into their careers will be hit very hard by the contracting out, with even a short period contracted out, a year or 2 for example, leading to a hefty reduction in the new pension seemingly out of proportion to the time spent contracted out. I for one expect to get nothing close to the widely touted State Pension of £155 or whatever it is in a couple of decades time because of the time spent in AFPS.

I wonder if he conveniently forgot about this or just didn't realise ... politics or incompetence, which noose would you rather hang yourself with Mr Johnson?
Indeed, I have 26 years contributions so far contracted ouy with no previous NICs. If I serve out my LOS30 I have no idea how short I will be for a full state pension. Do my years contracted out even count towards the required 35 years?
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Old 30th Mar 2016, 12:18
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It's a downright disgrace IMHO that you serving guys don't get support from the MOD/RAF with such important issues as Pensions and seemingly just left to figure it out yourselves ... No disrespect to Al and his valiant efforts on here.

Say what you like about 'HR Functions' in civvy street Corporates ... But the majority even manage to get that right ... There would be open revolt if they didn't.
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Old 30th Mar 2016, 22:38
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Coffman,

Absolutely no offence taken. To further prove your depressingly prescient point, Katie Morley possibly pulled a rabbit out of the hat with this one the other week.

The separation of NIC from HMRC and the fact that DWP and HMRC just don't work together has created, potentially, a holy mess. It will be interesting to see if MoD still keeps records (post 2012, it wasn't required to do so) and whether the data that it does hold on you, in respect of your Guaranteed Minimum Pension, equates to that which the government assumes you have.

http://www.telegraph.co.uk/finance/personalfinance/pensions/12143174/Four-million-people-retiring-from-April-could-get-the-wrong-state-pension.html

In 2008, there was a big drive to empower SP financially. That seems to have withered on the vine though.
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Old 30th Mar 2016, 22:43
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Melchett,

It's a complete disaster. This news crept out over the Easter weekend.

http://www.bbc.co.uk/news/business-35904417
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Old 30th Mar 2016, 22:58
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OAP,

I think it'll be seventy five in very quick order. I spoke with someone at the Treasury - what it's gearing up for is the next public sector pension slash and burn. The lifetime ISA will herald the end of the pension, as we know it, for those about to join the workplace.

If we want to see how the Tories tacitly see retirement 'evolving', look no further than its left field mouthpiece, floating the idea a week ago. To an extent, a pragmatic reality check (after all, we know affordability is long past the point of being a contentious debating point) but the evangelical fervour with which it conceptualises the future, makes for depressing reading.

http://www.conservativehome.com/thetorydiary/2016/03/we-should-face-up-to-the-end-of-retirement.html

The entire concept of ‘a retirement’ is, after all, an artefact of the welfare system. It was clumsy of the original architects of pensions to base their end-of-life benefit on a fixed age, rather than need. That the pension age then fell so far behind life expectancy was politically inevitable, but the consequences have caught up with us. Simply put, today’s young people face the fact that they will not have a long retirement. The state cannot afford for an increasing number of physically able older people to drop out of the workforce years, or decades, before they need do so.

In the future, the idea of decades of life out of work will probably seem as unreal as the old, final-salary corporate pensions of the yesteryear do today, a few public-sector holdouts notwithstanding. As medical advances help us stay active longer, the expectation in the future must surely be that whilst you can work, you work – unless you can save enough to pay for a period of idleness yourself. We have already started in that direction: where once the retirement age was a guillotine that fell across a person’s career, it is now simply a milestone at which one unlocks an entitlement. Eventually it will not even be that.

These additional years in work, combined with measures such as the Lifetime ISA to encourage life-long saving, will afford people more time to accrue the money they need to provide for themselves in their twilight years. Meanwhile the original function of the state pension – to provide for those incapable of supporting themselves financially from the end of work until they died – could be served by some form of needs-based infirmity payment.
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Old 31st Mar 2016, 06:12
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Al,

An interesting post from Conservative Home there. And I use the word interesting in the same way one might use the word egregious to describe someone like politicians or Treasury officials. The use of the word 'idleness' will surely get peoples' backs up and probably isn't the way to get people on board after a 40-50 years of slogging away, before spending their final years with family and doing things they want to do rather than have to do. And whilst they may have a point about the general direction of travel vis-a- via life expectancy and affordability, I wouldn't be at all surprised if any Govt that decided to pull the plug on pensions retrospectively after people have contributed via NICs (I do realise they pay for current rather than future liabilities) wasn't challenged, both in the Commons (more likely if we continue to move towards a true multi-party system with smaller majorities & Coalitions) and in the courts.

But what really astounds me about the Conservative Home post is that they talk as though they genuinely believe that Govt policy on pensions, savings and retirement etc is coherent and that this plan will actually work. It's nothing of the sort and you only have to look at the example of politicians on the one hand extolling the virtue of responsibility and saving for the future whilst simultaneously doing everything they can to tax us into penury and wrap us up in red tape. The public will only accept what is being discussed here when the politicians accept that they need to stop screwing people over to plug the gaps due to their fiscal incompetence.
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Old 31st Mar 2016, 07:12
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So if someone served 30 years in the armed forces, how many years of NICs would that amount to?
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Old 31st Mar 2016, 07:49
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Al ...

AOC 1 Group recently Tweeted ...

2 days with the leadership of 1Gp discussing how to deal with the significant challenges ahead in 2016/17. People 1st across the Whole Force
My Bold Text.

I would have thought that providing effective/timely pension information/support should be an important item on any 'People 1st' Agenda ... It's a basic employment responsibility.

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Old 1st Apr 2016, 09:04
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OAP,

I think it'll be seventy five in very quick order. I spoke with someone at the Treasury - what it's gearing up for is the next public sector pension slash and burn. The lifetime ISA will herald the end of the pension, as we know it, for those about to join the workplace.

If we want to see how the Tories tacitly see retirement 'evolving', look no further than its left field mouthpiece, floating the idea a week ago. To an extent, a pragmatic reality check (after all, we know affordability is long past the point of being a contentious debating point) but the evangelical fervour with which it conceptualises the future, makes for depressing reading.

We should face up to the end of ‘retirement’ | Conservative Home
Hi Al,

Yes, I expect the moving goalposts will continue with increasing the age and qualifying work years for state pension. Let's face it, there has been little voter rebellion to the huge change in female state pension age due, I think, to the fact that it has not yet effected many ordinary people. But, it will! I do not think many people realise that the present delay of female state pension age has cost all future female OAP's around £50,000! One important factor that is purposely not highlighted is, that living longer (alegedly) in old-age does not make you suitable for productive work in old age. Cheers

OAP
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Old 1st Apr 2016, 12:27
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Just been on the beta UK Gov pension calculator. It came out with £155 ish at age 67. My details are 37 years contributions so far - 2 civil service, 34 military, 1 civil employment.

Am I right in thinking that the reduced NIC I have paid will reduce that figure once they get factored in?

//trk
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Old 1st Apr 2016, 15:58
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No idea how it works now, but as a datum I did something like 29 years [over 21] and then 5 of paid voluntary work. I get £121 a month.
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Old 2nd Apr 2016, 12:12
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Originally Posted by PARALLEL TRACK
Just been on the beta UK Gov pension calculator. It came out with £155 ish at age 67. My details are 37 years contributions so far - 2 civil service, 34 military, 1 civil employment.

Am I right in thinking that the reduced NIC I have paid will reduce that figure once they get factored in?

//trk
If you are retiring and collecting the new state pension now after a career of only lower opted out NI contributions then your pension will be lower than those who had not opted out. However, if you are still some years away from national retirement age then any 'full' NI contributions made from now onwards will serve to increase your final pension amount. Very broadly speaking, if you are still 10 or more years away from the national retirement age and make another 10 years full contributions and then have enough total years contributions for a full pension then you will get the full pension. Hence why the calculators might be showing higher amounts than you expect.
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Old 2nd Apr 2016, 18:52
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SERPS

Back in the old days the service opted out of the state pension system, we all thought, and were encouraged to think, you just lost the increased element earned by higher pay levels and paid a lower NIC, WRONG.

That's why it was called State Earning Related Pensions System. Only when you reached retirement age did you discover that you earned no state pension credit for those years and because you were no longer earning you could not buy them back.

My state pension is reduced by £95 per week for the lost years of contributions but naturaly I am happy to know it helps the service meet the deffence need
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Old 3rd Apr 2016, 08:48
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Forgive my total ignorance, but do I understand correctly that all military service was "opted out" so you get nothing for years contributed to state pension? I did 37 years and now working abroad so not paying any more NI. Does that mean I'll get nothing?
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Old 3rd Apr 2016, 08:55
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Originally Posted by Onceapilot
Hi Al,

Yes, I expect the moving goalposts will continue with increasing the age and qualifying work years for state pension. Let's face it, there has been little voter rebellion to the huge change in female state pension age due, I think, to the fact that it has not yet effected many ordinary people. But, it will! I do not think many people realise that the present delay of female state pension age has cost all future female OAP's around £50,000! One important factor that is purposely not highlighted is, that living longer (alegedly) in old-age does not make you suitable for productive work in old age. Cheers

OAP
My Twitter timeline is full of people angered by a) me, and b) my attitude to the WASPI thing. I was called racist, sexist, mysoginist.. you name it (the little poppets didn't realise I had my skin leathered and tanned in a gunshed). Gender is now not even used to level previously undulating and unfair aspects of retirement planning; now, it seeks promote the gender as you would promote any other niche lobby. To my mind, far more important than gender when determining the nature of one's state pension are postcode, occupation and health. For women currently in their fifties/sixties to assume that women in their early twenties must work until they're seventy five or older, because they want to pick and mix aspects of gender equality, is the height of selfish arrogance. I'm well familiar with the intricacies of the WASPI campaign; and I am all for helping those with a plausible case. But not a blanket reversion, which is what the campaign seeks.
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