Actuarial Reductions - LGPS Advice
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Actuarial Reductions - LGPS Advice
Myself and two colleagues are helicopter pilots with the police. We are all in the age bracket (54-58 years old) and have been members of the Local Government Pension Scheme (LGPS) for a number of years. Our employment as pilots is controlled by the Civil Aviation Authority (CAA) who state that we cannot fly single pilot aircraft (police helicopter) post our 60th birthday. We have been informed by our employer, XXXX Police that on reaching our respective 60th birthdays our employment will be terminated by means of "voluntary retirement" and should we wish to take our pensions early, i.e. at 60 years old as opposed to 65 years old then these will be subject to an actuarial reduction of 25% and any lump sum reduced by 14%. Is this correct? Surely, as we are being forced to retire purely due to reaching 60 years of age and not being able to continue employment because of a CAA Directive, this should not warrant the actuarial reduction of our pensions? In effect we are being made redundant. I would be most grateful if you would kindly offer any advice as how we should address the situation we find ourselves in.
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I speak as an LGPS pensions clerk (for the past 15 months) and union rep (for the three years before that).
Someone choosing to retire from the LGPS at 60, when their 'normal retirement age' is 65, would indeed have exactly the reductions you quote.
In your situation it is extremely doubtful the retirement is voluntary.
If you were made redundant at 60, there would be no actuarial reduction. You still wouldn't have accumulated as much pension as if you retired at 65, but that's a different thing.
It's not redundancy - the post still exists - but neither is it voluntary. Was there anything in writing to the effect of 'the postholder agrees to retire at 60'? Certainly if anyone had come to me as a rep in a situation like that I'd've taken the case, but it would have needed a specialist and would quite possibly have gone further up the line.
Hope that's helpful - best wishes, Steve.
Someone choosing to retire from the LGPS at 60, when their 'normal retirement age' is 65, would indeed have exactly the reductions you quote.
In your situation it is extremely doubtful the retirement is voluntary.
If you were made redundant at 60, there would be no actuarial reduction. You still wouldn't have accumulated as much pension as if you retired at 65, but that's a different thing.
It's not redundancy - the post still exists - but neither is it voluntary. Was there anything in writing to the effect of 'the postholder agrees to retire at 60'? Certainly if anyone had come to me as a rep in a situation like that I'd've taken the case, but it would have needed a specialist and would quite possibly have gone further up the line.
Hope that's helpful - best wishes, Steve.
Flashman,
You probably know me! I recall your handle. This has been legally clarified by the unit I used to work for. If you PM me I wil put you in touch with someone who is going thru this right now.
The bottom line is that from a police perspective they MUST offer you a continuation of your employment unless or until you resign or, are retired naturally. Now, at the moment that job is as a police pilot but there are external forces causing them to prevent you from continuing as a pilot because of your SPIFR status.
So LEGALLY they are obliged to offer you an equivalent position - guess what, there are non at this level in the force on this salary that you are 'qualified' to do. You could work for less in a lower scale job if you so wished and if there was a vacancy....
IF you choose NOT to stay on, then it means you have voluntarily retired and consequently your pension is capped proportionately. It is NOT of their doing, I think you'll find them saying....and guess what, legally, they are correct.
You are not alone and I assumed that this was resolved many moons ago. One pilot (Ian....?) took the CAA to court a while back...and lost!
Prepare to retire at 60!
You probably know me! I recall your handle. This has been legally clarified by the unit I used to work for. If you PM me I wil put you in touch with someone who is going thru this right now.
The bottom line is that from a police perspective they MUST offer you a continuation of your employment unless or until you resign or, are retired naturally. Now, at the moment that job is as a police pilot but there are external forces causing them to prevent you from continuing as a pilot because of your SPIFR status.
So LEGALLY they are obliged to offer you an equivalent position - guess what, there are non at this level in the force on this salary that you are 'qualified' to do. You could work for less in a lower scale job if you so wished and if there was a vacancy....
IF you choose NOT to stay on, then it means you have voluntarily retired and consequently your pension is capped proportionately. It is NOT of their doing, I think you'll find them saying....and guess what, legally, they are correct.
You are not alone and I assumed that this was resolved many moons ago. One pilot (Ian....?) took the CAA to court a while back...and lost!
Prepare to retire at 60!
I can only speak for the NHS but the advice you have been given would be spot on in the NHS
If you stop working you no longer make contributions. If you take your pension and it is before the normal retirement age it is reduced on an actuarial basis. Your alternative is not to take it but freeze it until the normal retirement age but that leaves you nothing to live on.
Certain occupations are allowed to retire early - psychiatrists retire at 55 but other doctors have to wait until 60. However when all this was set up there were no pilots
In the NHS doctors who can't work as doctors press their employer to give them alternative work. It is usually pushing pieces of paper round a desk and the employer soon caves in at the cost or the hassle and makes the individual redundant.
If you stop working you no longer make contributions. If you take your pension and it is before the normal retirement age it is reduced on an actuarial basis. Your alternative is not to take it but freeze it until the normal retirement age but that leaves you nothing to live on.
Certain occupations are allowed to retire early - psychiatrists retire at 55 but other doctors have to wait until 60. However when all this was set up there were no pilots
In the NHS doctors who can't work as doctors press their employer to give them alternative work. It is usually pushing pieces of paper round a desk and the employer soon caves in at the cost or the hassle and makes the individual redundant.
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LGPS - Police Pilots
I suggest that ALL police pilots get together and join BALPA - soon. You can claim back a proportion of your fees against tax every year.
Apart from the 60 year old single pilot problem, other problems of an even greater nature are on the immediate horizon. As soon as everyone is on board a pay reduction is coming........
JOIN BALPA
Apart from the 60 year old single pilot problem, other problems of an even greater nature are on the immediate horizon. As soon as everyone is on board a pay reduction is coming........
JOIN BALPA
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I'd join tomorrow but we need everyone in police aviation to join if we are to get full BALPA representation. I'll pass the word but there are some BALPA non-believers out there. 👀
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Previous BALPA related Rotorheads threads;
http://www.pprune.org/rotorheads/293...bership-2.html
http://www.pprune.org/rotorheads/457...embership.html
http://www.pprune.org/rotorheads/293...bership-2.html
http://www.pprune.org/rotorheads/457...embership.html
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Can we tidy up whether we are talking Pension Age or Retirement Age.
For those at age 50 now, you'll be looking at a 'Pension Age' of 66.
If that's the age we are discussing, that extra year takes the Actuarial reduction from 25% to 29%
Actuarial reduction | lgps2014.org
However if its the 'Retirement age' being discussed, there is none. I'm guessing now that it's the contractual wording that counts.
Does the contract specifically mention 'Single Pilot' and also say something like 'you are to hold a valid UK Commercial Pilots Licence'?
Your licence will still be valid until age 65, the point at which you have, by age alone, 'defaulted' on your contract. This is only because of the ANO. If the contract doesn't mention single pilot, I wonder what, in all seriousness, would happen if you turned up for work on your 60th birthday .... !
There are always other tracks to take;
https://www.gov.uk/retirement-age
Passengers or crew?
http://www.caa.co.uk/docs/1428/Summa...009May2010.pdf
For those at age 50 now, you'll be looking at a 'Pension Age' of 66.
If that's the age we are discussing, that extra year takes the Actuarial reduction from 25% to 29%
Actuarial reduction | lgps2014.org
However if its the 'Retirement age' being discussed, there is none. I'm guessing now that it's the contractual wording that counts.
Does the contract specifically mention 'Single Pilot' and also say something like 'you are to hold a valid UK Commercial Pilots Licence'?
Your licence will still be valid until age 65, the point at which you have, by age alone, 'defaulted' on your contract. This is only because of the ANO. If the contract doesn't mention single pilot, I wonder what, in all seriousness, would happen if you turned up for work on your 60th birthday .... !
There are always other tracks to take;
https://www.gov.uk/retirement-age
If an employee chooses to work longer they can’t be discriminated against.
It is against the law to discriminate against anyone because of:
age
etc
It is against the law to discriminate against anyone because of:
age
etc
Passengers or crew?
http://www.caa.co.uk/docs/1428/Summa...009May2010.pdf
For example, if an operator is paid to carry a police observer, that observer will be a passenger and it will be a public transport flight. Similarly where a power company pays for its observer to be carried to inspect power lines or where a television company pays for its camera crew to be carried it will be a public transport flight. Where an observer or camera operator is employed by the operator, it is quite likely that the customer will not be paying directly for their carriage so that it will not be public transport.
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Sometimes I wonder why people find pensions so confusing. Then I read the information available and think 'oh yes, that's why.
SilsoeSid is talking about the State Pension Age when he refers to 66. That's the age at which you qualify for your State Pension.
In the LGPS, the Normal Retirement Age is currently 65. (If you've been in long enough, it's lower.) It's called a 'Normal' retirement age because ordinarily they can't force people to go (which is not the case here). Next year when the rules change, it is expected to change to the same as 'whatever the State Pension Age is'.
I believe that there is a Statutory Discretion to be able to waive actuarial reduction on early retirement. That means it's up to each Pension Fund (eg Suffolk, Birmingham, Strathclyde) to decide their policy on it. Therefore, as a contributor to the fund, you are entitled to know what your Fund's policy is. Bear in mind the policy could say 'under no circumstances'; on the other hand it might say 'on compassionate grounds' or 'on appeal to a subcommittee'.
You don't need 100% membership of BALPA in the office / Region / UK in order to benefit from being a member, you just need to be a member yourself and get them to take it on. Though I must say, the one I was in wouldn't help if you already had the problem and then joined (rather like waiting until your house catches fire and then ringing round for insurance quotes).
SilsoeSid is talking about the State Pension Age when he refers to 66. That's the age at which you qualify for your State Pension.
In the LGPS, the Normal Retirement Age is currently 65. (If you've been in long enough, it's lower.) It's called a 'Normal' retirement age because ordinarily they can't force people to go (which is not the case here). Next year when the rules change, it is expected to change to the same as 'whatever the State Pension Age is'.
I believe that there is a Statutory Discretion to be able to waive actuarial reduction on early retirement. That means it's up to each Pension Fund (eg Suffolk, Birmingham, Strathclyde) to decide their policy on it. Therefore, as a contributor to the fund, you are entitled to know what your Fund's policy is. Bear in mind the policy could say 'under no circumstances'; on the other hand it might say 'on compassionate grounds' or 'on appeal to a subcommittee'.
You don't need 100% membership of BALPA in the office / Region / UK in order to benefit from being a member, you just need to be a member yourself and get them to take it on. Though I must say, the one I was in wouldn't help if you already had the problem and then joined (rather like waiting until your house catches fire and then ringing round for insurance quotes).
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Thanks SilsoeSid & Hilico for your comments. I will try & sort out this issue without the aid of BALPA but I do intend joining them in the near future, if only for peace of mind whilst being employed by NPAS.
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This has been and continues to be the subject of a long standing battle.
LGPS rules are clear (and set in concrete), any pension taken before the Scheme's retirement age is subject to an actuarial reduction. Fixating on the term "voluntary" is a red herring.
It is for the employer to decide whether this penalty will be paid by them or the retiree. Grounds that usually result in payment (of the reduction) include redundancy and other forced re-deployment that has been deemed to be in the employer's interest. They will usually also encourage enforced retirees to apply for other posts for which they are qualified, within their organisation.
Most police helicopter pilots' contracts are clear: when you lose your licenced ability to fly single pilot public transport operations - your contract expires. The employer's argument is that this does not constitute enforced redundancy.
I agree with Flashman & others that the way ahead may be via BALPA but feel it is highly unlikely that anything more can be achieved via the age discrimination route. The issue must be taken to the employer, perhaps on the grounds of not offering appropriate pension arrangements at the start of contract. Interestingly there are schemes that would be appropriate, e.g. the Principle Civil Service Scheme enjoyed by the Met police pilots - retirement age 60.
LGPS rules are clear (and set in concrete), any pension taken before the Scheme's retirement age is subject to an actuarial reduction. Fixating on the term "voluntary" is a red herring.
It is for the employer to decide whether this penalty will be paid by them or the retiree. Grounds that usually result in payment (of the reduction) include redundancy and other forced re-deployment that has been deemed to be in the employer's interest. They will usually also encourage enforced retirees to apply for other posts for which they are qualified, within their organisation.
Most police helicopter pilots' contracts are clear: when you lose your licenced ability to fly single pilot public transport operations - your contract expires. The employer's argument is that this does not constitute enforced redundancy.
I agree with Flashman & others that the way ahead may be via BALPA but feel it is highly unlikely that anything more can be achieved via the age discrimination route. The issue must be taken to the employer, perhaps on the grounds of not offering appropriate pension arrangements at the start of contract. Interestingly there are schemes that would be appropriate, e.g. the Principle Civil Service Scheme enjoyed by the Met police pilots - retirement age 60.
Purveyor of Egg Liqueur to Lucifer
Changes Elsewhere!
http://www.icao.int/safety/Documents...port_FINAL.pdf
Upper Age Limit for Pilots
The current upper age limit for pilots engaged in international commercial air transport operations requiring two pilots, is 65 years. This limit applies to both pilots-in-command (PICs) and co-pilots, as a Standard for PICs and a Recommended Practice for co-pilots (Annex 1, paragraph 2.1.10). However, if one pilot is 60 years or more the other must be under 60 (colloquially known as the “one over one under” provision).
When the limit was increased in 2006 from 60 to 65 years, the ICAO Council and Air Navigation Commission (ANC) requested a review after five years of experience had been gained. A questionnaire was distributed to States and international organizations in 2012 and the results were considered by the ANC. This resulted in a new proposal which, if adopted, will permit two pilots aged 60-64 years to be simultaneously at the controls, and change the age limit for co-pilots from a Recommended Practice to a Standard. A State letter will be distributed in the first half of 2013 with a request for comments on the new proposal and if new provisions are agreed they could become applicable as early as November 2014.
Upper Age Limit for Pilots
The current upper age limit for pilots engaged in international commercial air transport operations requiring two pilots, is 65 years. This limit applies to both pilots-in-command (PICs) and co-pilots, as a Standard for PICs and a Recommended Practice for co-pilots (Annex 1, paragraph 2.1.10). However, if one pilot is 60 years or more the other must be under 60 (colloquially known as the “one over one under” provision).
When the limit was increased in 2006 from 60 to 65 years, the ICAO Council and Air Navigation Commission (ANC) requested a review after five years of experience had been gained. A questionnaire was distributed to States and international organizations in 2012 and the results were considered by the ANC. This resulted in a new proposal which, if adopted, will permit two pilots aged 60-64 years to be simultaneously at the controls, and change the age limit for co-pilots from a Recommended Practice to a Standard. A State letter will be distributed in the first half of 2013 with a request for comments on the new proposal and if new provisions are agreed they could become applicable as early as November 2014.
Purveyor of Egg Liqueur to Lucifer
Thomas coupling
I'm so sorry TC. I had a look around for the best rotorhead thread to add this info to and decided here.
I appreciate that in your opinion it may be a bit far down the line for Flash, but I disagree given the time scales quoted, there may still be hope for him, with a bit more hope for us others. Next time I'll remember to PM you to consult where and what to post*, so as not to conflict with anything you may think it would conflict with and whether the info I have would be relevant.
I hope you don't mind me asking a general, for everyone, question;
I wonder who/what the pushing force for this change was?
* but probably not!!!!
SS: This doesn't help Flashman though does it?
Flash: Have you accepted yet, the fact that you are past your shelf date at 60 with your current job
Flash: Have you accepted yet, the fact that you are past your shelf date at 60 with your current job
I appreciate that in your opinion it may be a bit far down the line for Flash, but I disagree given the time scales quoted, there may still be hope for him, with a bit more hope for us others. Next time I'll remember to PM you to consult where and what to post*, so as not to conflict with anything you may think it would conflict with and whether the info I have would be relevant.
I hope you don't mind me asking a general, for everyone, question;
I wonder who/what the pushing force for this change was?
* but probably not!!!!
SS: Thanks for finding the time to jump across to this thread from your thread over on NPAS. 
What Flashman purports to has been in and out of the wrangler for atleast 7 years that I can recall. It has been beaten to death by the police fraternity and also tested in court and defended by the CAA. Unless the EU disintegrates in the immediate future, taking with it ICAO, there is as much chance of this rule being overturned as there is of you NOT posting on the NPAS forum ever again
Flash - grow old disgracefully - steal the chopper on your last shift and dump it on Bardsey Island and get your brother to pick you up on his workboat.
Se how long it takes plod to find it
What Flashman purports to has been in and out of the wrangler for atleast 7 years that I can recall. It has been beaten to death by the police fraternity and also tested in court and defended by the CAA. Unless the EU disintegrates in the immediate future, taking with it ICAO, there is as much chance of this rule being overturned as there is of you NOT posting on the NPAS forum ever again
Flash - grow old disgracefully - steal the chopper on your last shift and dump it on Bardsey Island and get your brother to pick you up on his workboat.
Se how long it takes plod to find it
Purveyor of Egg Liqueur to Lucifer
Says the man having posted in 4 different threads within 18 minutes !
Not my thread TC, just as rotorheads isn't your forum!
When you say "...there is as much chance of this rule being overturned as there is of you NOT posting on the NPAS forum ever again" , are you sure about that? As my official email has changed and the official NPAS forum has all but disappeared, 'The NPAS Forum' won't be hearing from me again, as it hasn't for a fair few months now. But of course, you wouldn't know this because you don't have .pnn access, do you
Not my thread TC, just as rotorheads isn't your forum!
When you say "...there is as much chance of this rule being overturned as there is of you NOT posting on the NPAS forum ever again" , are you sure about that? As my official email has changed and the official NPAS forum has all but disappeared, 'The NPAS Forum' won't be hearing from me again, as it hasn't for a fair few months now. But of course, you wouldn't know this because you don't have .pnn access, do you
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before I started flying I worked at one time for the inland revenue superannuation funds office (SF0) later the Pensions Schemes office (PSO), although I admit that this was a long time ago (1986-87 actually)
one of the things i did was to approve the rules of new pension schemes as well as rule changes to existing schemes.
as part of this role, approval of 'low normal retirement ages" was common for various employee sectors, who could not normally expect to work to the standard normal retirement age.
for example i approved some low normal retirement ages of 35 for some famous footballers of the day.
the only thing i can't remember is whether this was allowed as a sub section within the existing scheme or if it required a new sub scheme.
it seems to me that the problem here is that when the pilots were first employed as a group that no one took ownership of the task of securing a normal pension age of 60 for the pilot group.
this may have been due to a lack of pilot representation (BALPA membership) i don't know. or may have simply been because no one ever asked and spent energy arguing about interpretation of existing rules rather than getting the rules changed or a sub scheme started.
my knowledge of the former SFO policy is that a change from 65 to 60 should have been no problem at all given the licensing issues that created the problem.
one of the things i did was to approve the rules of new pension schemes as well as rule changes to existing schemes.
as part of this role, approval of 'low normal retirement ages" was common for various employee sectors, who could not normally expect to work to the standard normal retirement age.
for example i approved some low normal retirement ages of 35 for some famous footballers of the day.
the only thing i can't remember is whether this was allowed as a sub section within the existing scheme or if it required a new sub scheme.
it seems to me that the problem here is that when the pilots were first employed as a group that no one took ownership of the task of securing a normal pension age of 60 for the pilot group.
this may have been due to a lack of pilot representation (BALPA membership) i don't know. or may have simply been because no one ever asked and spent energy arguing about interpretation of existing rules rather than getting the rules changed or a sub scheme started.
my knowledge of the former SFO policy is that a change from 65 to 60 should have been no problem at all given the licensing issues that created the problem.
Last edited by Camp Freddie; 5th Nov 2013 at 02:10.