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AFPS15 - government decision.

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AFPS15 - government decision.

Old 1st Feb 2021, 11:58
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I heard this morning that there is to be a Treasury announcement on this on 4 February.
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Old 1st Feb 2021, 12:38
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Originally Posted by ForcesPensionSociety
I heard this morning that there is to be a Treasury announcement on this on 4 February.
Thanks for the update.
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Old 4th Feb 2021, 09:48
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The news from HMT is that everyone serving on 31 March 2012 and forced onto AFPS15 will be transferred back to whatever scheme they were on at the time. As expected, everyone serving on 1 Apr 2022 will be transferred to the new scheme regardless of age. For the avoidance of confusion that means you will have the choice of legacy or reformed scheme benefits, so you can take whichever option is most advantageous to you.

At the point you decide to take pension benefits, you will have the option of either taking those benefits per your previous scheme or electing for a reversion to AFPS15 wef 1 Apr 15 and being treated accordingly. There should be more detailed information coming from MOD and FPS, as there will have to be some form of adjustment for all those who have had tax bills over the last few years (Scheme Pays etc.) Not sure what they will do about people who paid the bill up front, presumably the remedy arrangements will have to take all that into account.

I think MOD will have a lot of work to do on the details and DBS will no doubt be prioritising those closest to retirement. There will clearly be some retrospective work to provide the same choice for those who retired on the reformed scheme (AFPS15). There will still be tax bills for some...
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Old 4th Feb 2021, 10:45
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Great news, on the face of it! Hopefully the timescale for remedy is reasonable from hereon 🤞
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Old 4th Feb 2021, 10:55
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The consultation.

https://assets.publishing.service.go...onse_final.pdf
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Old 4th Feb 2021, 10:58
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Originally Posted by Fortissimo
At the point you decide to take pension benefits, you will have the option of either taking those benefits per your previous scheme or electing for a reversion to AFPS15 wef 1 Apr 15 and being treated accordingly.
The risk-cost has been consigned to the government down the road. In itself, it means that huge uncertainty will prevail and the cost (whatever it will be) be be transferred to those following on.
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Old 4th Feb 2021, 11:21
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https://forcespensionsociety.org/202...edy-announced/
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Old 4th Feb 2021, 11:53
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Great news!! For the dense among us, does this mean that a) my current mix of monthly AFPS75/15 pension payments will start to increase when it goes fully AFPS75, And b) will I get a refund of the missed 75 payments for the 5 years I spent unwillingly on AFPS15?!

cheers all.
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Old 4th Feb 2021, 14:23
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Deferred Choice - can ask for no better than that.

Surprised that they need to consult on what interest rates to pay us though. I had thought there was a well-worn path with such rates that and they have had plenty of time to sort it all out rather than trigger another unbounded consultation.
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Old 4th Feb 2021, 18:59
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Good news indeed. Hopefully it shouldn’t be too difficult to update the Armed Forces Pension Calculator so we can clearly see the options.
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Old 5th Feb 2021, 08:27
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This was clearly a nightmare scenario for all those serving.
So glad to see that a fair and uniform decision seems to have been reached.

lsh

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Old 5th Feb 2021, 14:18
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[QUOTE=Party Animal;10983629]Good news indeed. Hopefully it shouldn’t be too difficult to update the Armed Forces Pension Calculator so we can clearly see the options.

The fact that there is no new calculator is a good example of what’s wrong here. Whilst this was all being staffed and dotted/ crossed you’d have thought someone would have engaged with whoever builds the calculator.
A ‘good few months’ was an answer I was given today.
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Old 5th Feb 2021, 14:54
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This is going to make my next tax return a bit tricky, along with whatever happens to scheme pays arrangements and pension tax bills.
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Old 5th Feb 2021, 15:59
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Originally Posted by flyingorthopod
This is going to make my next tax return a bit tricky, along with whatever happens to scheme pays arrangements and pension tax bills.
Wouldn't want to be leaving the service in the next 6 months either. I'd imagine that'll be a car crash!
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Old 6th Feb 2021, 06:09
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I wouldn't worry about the next 6 months:

Gov.uk announcement
If you read in detail, I don't think this is going to actually happen until October 2023. The recent "consultation" was a foregone conclusion (it was always going to be the deferred option - the other option was a redress waiting to happen). Like others have said, it's been a good lot of delaying tactics to push the cost into later budgets.

But still, I'm looking forward to getting the pension I actually signed up for.
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Old 8th Feb 2021, 12:06
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ONS has (this morning) announced a 21% increase in government pension liabilities - including £1.2trn for unfunded defined benefit pension entitlements for public sector employees, equal to 55% of GDP - just think about that. Paying an additional c£4bn pa in respect of this report won’t help things for those much younger and still hard charging in accrual.
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Old 21st Feb 2021, 17:44
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AFPS Can’t help

I am not asking for advice.
Am I correct in assuming that if I return to 05 from an 05/15 split my PIA will reduce for each year back to 2015?
I’ve asked the PS and got told they don’t give out advice (?) on that and I should consult a professional. I’m after an answer, as if the accrual rate does decrease 1/40 versus 1/70 rough terms, then I have more of my AA to use.
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Old 21st Feb 2021, 19:28
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I think you may be a bit muddled with your logic? AFPS15 is 1/47th so will not decrease, but increase, your Pension Input Amount (PIA). So reverting to AFPS05 at 1/70th could well reduce your PIA. However, I believe that few get close to the Annual Allowance maximum of £40k with AFPS15 or AFPS05 - it is usually the AFPS75 lurking in the background that is the killer. That is my understanding anyway - and I’m happy to be proved wrong!
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Old 21st Feb 2021, 20:05
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Originally Posted by Lima Juliet
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I think you may be a bit muddled with your logic? AFPS15 is 1/47th so will not decrease, but increase, your Pension Input Amount (PIA). So reverting to AFPS05 at 1/70th could well reduce your PIA. However, I believe that few get close to the Annual Allowance maximum of £40k with AFPS15 or AFPS05 - it is usually the AFPS75 lurking in the background that is the killer. That is my understanding anyway - and I’m happy to be proved wrong!
Good post, Lima, and I agree with 05 being the slower burner. Just for interest I know of a couple of NCA MAcr that were moved onto 15 coming within a couple of £1000 of the AA on promotion. There’s probably more, but if you aren’t sent a letter, then why ask.. there could be quite a few close to the AA on 15 without knowing. I think they had to write to find out, so I should imagine Glasgow PIA department is going to get asked to re-run their calculations soon.
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Old 21st Feb 2021, 20:52
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popeye107

I believe that the AFPS15 MAcr will also be on AFPS75 as AFPS75/15 pension earners. The PIA could well be the fact that promotion to MAcr a couple of years previously, and possibly PAS supplements, means that the ‘lurking’ AFPS75 has now picked this amount up. Everyone is different as it depends on time served, rank and pay scales. But I suspect that your Masters getting close are being ‘stung’ by the 75 portion, that accrues at uneven rates, rather than the 15 portion that accrues at 1/47th

You can see the uneven accrual rates for AFPS75 in the Pension Code tables here: https://www.gov.uk/government/public...des-april-2020

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