AFPRB
If you are on DII then check out the DIN.
No DII for me as away from the mainstream; no RRP either as a PAS OF3. I had hoped that the PAS structure would be extended downwards to catch pilots earlier in their career, ideally post first operational tour. The new career average pension scheme does nothing for those spending an extended period as a JO whilst dining on RRP and FRIs.
Ok, being a sad git with a spare 20 minutes I have just done a quick spreadsheet analysis between old and new to try and put this to bed. Assumptions are that the individual joins at 21 on a SSC, goes FJ and takes just over 4 years to get there (there are 185 weeks of IOT, EFT, FJLIN, BFJT, AJT and OCU alone let alone leave and other courses). For both RRP methods the rank structure stays the same - normally Fg Off for 2.5yrs and thence on Flt Lt.
On either system both start on £30,923 per annum as Fg Off going up to Flt Lt at £39,629 after 3 yrs from IOT. Not bad for the average graduate.
On the old RRP scheme they would start RRP on completion of the OCU on lower rate of £5,339 per annum. This then rises every 4 years to £9,066, £14,417 and £16,972. If the individual leaves at their SSC 12 yr option they would have got a total of £57,620 of RRP during their time. If they stay to AFPS15 40/18 EDP they would get a total of £166,204 during their time. Obviously either example can then leave with an Early Departure Payment (EDP) or if not a Sqn Ldr apply for assimilation to PAS.
Under the new scheme the pilot would not get RRP until ~2 years later than under the old RRP scheme. They would then get £4,000 per annum, about £1,300 less than the old scheme, until approximately their 11th year of service. However, at that point, they would then get a rise to £13,249 per annum of RRP; which is ~£4,000 more than the old RRP scheme. If they choose to elave at the 12 yr SSC point they would have got £33,249 of RRP during their time. HOWEVER, also at this point between year 11 and 12 they would get the £70k which 'bonds' them in for a further 6 years which takes them to their 40/18 EDP point. If they choose to retire at this point they will have had £156,397 of RRP plus a £70,000 FRI - that is ~£60,000 more than the previous RRP scheme.
Originally, I opined that this scheme would better target the EDP point, but now I can see the logic behind these new measures. It says in the AFPRB that the OF-3/4/5 cadre is in manning balance; which it is more or less. However, in the next 5-10 years there are an awful lot of Nav/WSOs coming up for retirement so I think a FRI at the EDP will also be needed if we want this to remain in balance.
Oh, and for those that transition to the new RRP scheme they will also be "Quids In" as previously stated. I make it about £2k on average when you translate from the old rates to the new Tier 2 rates.
So overall, this is SOMETHING TO BE HAPPY ABOUT FOR ONCE!!!
Headline figures:
Newbie £60k better off until 40/18
Transitional Arrangement person ~£2k per year better off
LJ
On either system both start on £30,923 per annum as Fg Off going up to Flt Lt at £39,629 after 3 yrs from IOT. Not bad for the average graduate.
On the old RRP scheme they would start RRP on completion of the OCU on lower rate of £5,339 per annum. This then rises every 4 years to £9,066, £14,417 and £16,972. If the individual leaves at their SSC 12 yr option they would have got a total of £57,620 of RRP during their time. If they stay to AFPS15 40/18 EDP they would get a total of £166,204 during their time. Obviously either example can then leave with an Early Departure Payment (EDP) or if not a Sqn Ldr apply for assimilation to PAS.
Under the new scheme the pilot would not get RRP until ~2 years later than under the old RRP scheme. They would then get £4,000 per annum, about £1,300 less than the old scheme, until approximately their 11th year of service. However, at that point, they would then get a rise to £13,249 per annum of RRP; which is ~£4,000 more than the old RRP scheme. If they choose to elave at the 12 yr SSC point they would have got £33,249 of RRP during their time. HOWEVER, also at this point between year 11 and 12 they would get the £70k which 'bonds' them in for a further 6 years which takes them to their 40/18 EDP point. If they choose to retire at this point they will have had £156,397 of RRP plus a £70,000 FRI - that is ~£60,000 more than the previous RRP scheme.
Originally, I opined that this scheme would better target the EDP point, but now I can see the logic behind these new measures. It says in the AFPRB that the OF-3/4/5 cadre is in manning balance; which it is more or less. However, in the next 5-10 years there are an awful lot of Nav/WSOs coming up for retirement so I think a FRI at the EDP will also be needed if we want this to remain in balance.
Oh, and for those that transition to the new RRP scheme they will also be "Quids In" as previously stated. I make it about £2k on average when you translate from the old rates to the new Tier 2 rates.
So overall, this is SOMETHING TO BE HAPPY ABOUT FOR ONCE!!!
Headline figures:
Newbie £60k better off until 40/18
Transitional Arrangement person ~£2k per year better off
LJ
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As I am OCU+13y, I rather foolishly assumed I'd go onto the appropriate level of Rate 7 (£19,200), which is applicable from OCU+12y. Slightly miffed I'll join at Rate 4, which is applicable from OCU+9y.
Oh well
, now to take PAS or not?
Last edited by CommsBiff; 29th Mar 2017 at 10:27. Reason: Typo on Rate 4 amount
CommsBiff
Thanks, I haven't seen the full DIN on the transitional arrnagments. The Rate 4 is £17,501 and so yes it would be only £528 increase. But after 3 years it would be a rise of £2,227 over and above what you would get if you stayed on the old RRP scheme. Not huge sums when HMRC take their little bit, but better than a kick in the teeth 1%!
Best
LJ
Thanks, I haven't seen the full DIN on the transitional arrnagments. The Rate 4 is £17,501 and so yes it would be only £528 increase. But after 3 years it would be a rise of £2,227 over and above what you would get if you stayed on the old RRP scheme. Not huge sums when HMRC take their little bit, but better than a kick in the teeth 1%!
Best
LJ
Thanks for the details Leon. I had an FRI and was sad to see the taxman take pretty much 50% in tax and NI. Looks to me like a just below age 30 Flt Lt Pilot will be getting roughly 50k in gross pay. How does the "not independent pay review board" (bored?) square that with the £100k+ benefits of a less than age 30 Airline Captain?
If the fairness of Service life and payscales stand on their own merit, why do the Gov/MOD continue the farce of lying about how they decide to pay Service personnel?
OAP
If the fairness of Service life and payscales stand on their own merit, why do the Gov/MOD continue the farce of lying about how they decide to pay Service personnel?
OAP
Leon,
Your calculations don't appear to take tax into account and a lump sum is hugely tax inefficient. A 40% rate tax payer will only get 42k in their bank (7k a year for 6 years RoS).
Also, the pay appears to come into effect 6 years after the start of phase 2 flying training; IOT plus a 6 month hold and you can delay all those figures by a year.
Has anyone seen anything in the AFPRB report about PAS retention? I have only skimmed it but it appears that they aren't concerned about retaining people after they've transferred to PAS (and are no longer in receipt of RRP)?
Your calculations don't appear to take tax into account and a lump sum is hugely tax inefficient. A 40% rate tax payer will only get 42k in their bank (7k a year for 6 years RoS).
Also, the pay appears to come into effect 6 years after the start of phase 2 flying training; IOT plus a 6 month hold and you can delay all those figures by a year.
Has anyone seen anything in the AFPRB report about PAS retention? I have only skimmed it but it appears that they aren't concerned about retaining people after they've transferred to PAS (and are no longer in receipt of RRP)?
OAP
I also had a FRI of £50k - worked out as £29,500 as 40% tax and £500 National Insurance. Mrs LJ spent it on a new 4x4 and woosh it was gone!!!
Not so sure that there are many airline captains aged 30 earning £100k per year though? Normally it takes 10 years plus as an experienced pilot to get a left hand seat with the 'big boys' that pay this sort of money in my humble opinion. Plus they normally pay towards their pension at about £15k per year to get a similar amount as the AFPS.
A Flt Lt pilot that has been in about 12 years is going to be paid about £65k (inc flying pay) plus not be paying into a pension which would cost a further £15k. So that is £80k real terms then get a loyalty payment of £70k to stay for a further 6 years before they qualify for a pension for life and a tax free lump sum isn't too uncompetitive. Also, if you are doing it to become rich then they are in the wrong job, I would suggest!
Best
LJ
I also had a FRI of £50k - worked out as £29,500 as 40% tax and £500 National Insurance. Mrs LJ spent it on a new 4x4 and woosh it was gone!!!
Not so sure that there are many airline captains aged 30 earning £100k per year though? Normally it takes 10 years plus as an experienced pilot to get a left hand seat with the 'big boys' that pay this sort of money in my humble opinion. Plus they normally pay towards their pension at about £15k per year to get a similar amount as the AFPS.
A Flt Lt pilot that has been in about 12 years is going to be paid about £65k (inc flying pay) plus not be paying into a pension which would cost a further £15k. So that is £80k real terms then get a loyalty payment of £70k to stay for a further 6 years before they qualify for a pension for life and a tax free lump sum isn't too uncompetitive. Also, if you are doing it to become rich then they are in the wrong job, I would suggest!
Best
LJ
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One of the most telling one liners in the brief was that Her Majesty could not compete with the civil sector when it comes to raw, financial re-numeration. In order to fund this 'uplift' in RRP(F) as it currently stands, the money has had to come from within the Defence budget. Any further uplift in RRP(F) would have meant that that another group/band/cohort in Defence would have dipped out.
Personally, I believe that this will see more aircrew retained which, I suppose (rightly or wrongly), is the overall purpose of this review.
Personally, I believe that this will see more aircrew retained which, I suppose (rightly or wrongly), is the overall purpose of this review.
Last edited by mftx7jrn; 29th Mar 2017 at 14:54.
SAR Bloke
It is normal to discuss salaries before tax as you may have other incomes or savings that affect your take home...
You haven't imcluded NI in your tax figure for the £70k FRI, so it will probably come to around £38-40k after 40% tax and Ni. I can't be fagged to work it out. However it will equate to £600+/month in your pocket if you want to look at it that way over the 6 years. Not to be sniffed at I would suggest?
Best
LJ
It is normal to discuss salaries before tax as you may have other incomes or savings that affect your take home...
You haven't imcluded NI in your tax figure for the £70k FRI, so it will probably come to around £38-40k after 40% tax and Ni. I can't be fagged to work it out. However it will equate to £600+/month in your pocket if you want to look at it that way over the 6 years. Not to be sniffed at I would suggest?
Best
LJ
MFTX7JRN
Incorrectly, I would suggest? The income tax would be 40% (tax code D0) and the National Insurance would be on top. So 40% would be £28,000, which gives you £42,000 but the bozos have missed off the NI that could be up to £4k or as little as £1k depending on your circumstances...
There are simple tax calculators online like UK Tax Calculator 2017 - Updated for the 2016/2017 and 2017/2018 Tax Year that help you plan. The NI bill on here for 2016/17 is a whopping £4700 or 6.8%!!
Best
LJ
Incorrectly, I would suggest? The income tax would be 40% (tax code D0) and the National Insurance would be on top. So 40% would be £28,000, which gives you £42,000 but the bozos have missed off the NI that could be up to £4k or as little as £1k depending on your circumstances...
There are simple tax calculators online like UK Tax Calculator 2017 - Updated for the 2016/2017 and 2017/2018 Tax Year that help you plan. The NI bill on here for 2016/17 is a whopping £4700 or 6.8%!!
Best
LJ
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For those with DIN access...is there a transitional arrangement for the FRI? Or is it a case that if you're OCU + 7 years and one day on 1st April you are no longer eligible?
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I believe this is what you would call a 'spectacular own goal'...
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Unfortunately, as with all previous FRIs, there has to be a cut off date. It's just plain bad luck for those on the wrong side of the OCU+7 / 1st April.
I agree with Leon and others that this is a pretty good deal overall which should hopefully drag more people through from end of Initial Training ROS to their EDP.
Word of warning on the £70k Retention Payment and tax implications... This payment, when added to usual salary, will see individuals break the £100k barrier in a single tax year which will lead to loss of some or all of your tax free allowance. Hence a further tax bill could be due in the year following receipt of payment. Those who took earlier FRIs will probably already know this. Some sound financial advice (Al R?) can reap rewards as there are ways to reduce your effective income below the £100k barrier and save on tax (small contribution to a personal pension for example...).
I agree with Leon and others that this is a pretty good deal overall which should hopefully drag more people through from end of Initial Training ROS to their EDP.
Word of warning on the £70k Retention Payment and tax implications... This payment, when added to usual salary, will see individuals break the £100k barrier in a single tax year which will lead to loss of some or all of your tax free allowance. Hence a further tax bill could be due in the year following receipt of payment. Those who took earlier FRIs will probably already know this. Some sound financial advice (Al R?) can reap rewards as there are ways to reduce your effective income below the £100k barrier and save on tax (small contribution to a personal pension for example...).
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Unfortunately, as with all previous FRIs, there has to be a cut off date. It's just plain bad luck for those on the wrong side of the OCU+7 / 1st April.
I agree with Leon and others that this is a pretty good deal overall which should hopefully drag more people through from end of Initial Training ROS to their EDP.
I agree with Leon and others that this is a pretty good deal overall which should hopefully drag more people through from end of Initial Training ROS to their EDP.
I, frankly, think this is an absolute kick in the teeth. I would say I hope it comes back to bite them, but we all know that it will just result in our Sqn mates having more leave cancelled, working harder and having less notice to move.
For what it's worth I think it actually makes a pleasant change to see a few guys with a smile on their faces for once. There are always winners and losers and, as a PAS guy it makes no odds to me, but it could have been a lot worse. Some of the guys I work with have actually had good news and that is rare.
Once again I apologise for being positive. I feel someone has to provide balance.
BV
Once again I apologise for being positive. I feel someone has to provide balance.
BV
