December 2010

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					                    Pensions Post – December 2010

        Welcome to the first edition of Pensions Post, our newsletter to keep you informed of any
              changes and developments to the Local Government Pension Scheme.


                              Changes that may affect you


Combining LGPS benefits – new rules If a member leaves the LGPS they are entitled
to leave their benefits in the Scheme (known as deferred or preserved benefits). If they later re-join the
LGPS with another Local Government employer, they may add their previous deferred benefits to the
benefits building up in their new employment. This is known as combining benefits.
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The LGPS regulations have been revised and existing active members on 30 September 2010 have
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until 30 September 2011 to combine any period of former local government membership with their
current membership.

       Are you currently paying into the Local Government Pension Scheme?

       Have you been a member of the scheme before?

       When you were re-employed, did you keep the membership from your earlier employment
        separate from your current active service?

If you can answer YES to all of these questions, you need to consider if you wish to combine your
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benefits. The deadline for doing this is 1 October 2011. You can find more information about making
this option on our web pages where there are notes on transferring service together with a form to
complete if you wish to exercise this option. Alternatively, you can contact Devon Pension Services
direct so that the notes and a form can be sent to you. If you are happy to leave your deferred benefits
as they are, you do not need to do anything.

Academy Schools              Recent changes to the LGPS regulations mean that Academy Schools will
become employers in the scheme. If you are employed by a school changing to academy status, your
pension will continue in the LGPS and your pension benefits will be unaffected.

Pensions Increase The Government has announced that it intends to change the measure that
it uses for cost of living increases to public sector pensions. This means that cost of living increases to
pensions in payment and to deferred pensions under the Local Government Pension Scheme (LGPS)
would be linked to the rise in the Consumer Prices Index (CPI), rather than to the rise in the Retail
Prices Index (RPI). This would apply to increases due from April 2011.

New Tax limits on pensions The government has announced plans to change the tax limits
applying to pensions. From April 2011 the amount by which the value of a person’s pension savings
can increase in any one year (the annual allowance) before a tax charge is due, will reduce from
£255,000 to £50,000 for all scheme members. Also, from April 2012, the total capital value of all a
person’s pension savings which they can build up (the lifetime allowance) without paying extra tax will
be reduced from £1.8million to £1.5million.

Whilst very few members will be affected by the reduction in the Lifetime Allowance, more will be
affected by the Annual Allowance changes, especially those who are both better paid with long service
or those who receive large promotional increases to their salary. For more information visit our
website.
                                      For your Information


Lord Hutton Public Sector Pensions review The Government created a Public Service
Pension Commission, headed by Lord Hutton, to undertake a “fundamental, structural review of public
service pensions”. The Commission has been tasked with assessing the current public service pension
schemes, including the LGPS, and to come forward with recommendations for future pension arrangements
that are sustainable and affordable in the long term, are fair to both the public service workforce and the
taxpayer and that protect existing scheme members’ accrued rights. The Commission will also consider
whether there is a case for changes in the scheme to be made to deliver savings in the short-term.
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Lord Hutton published the Commission’s interim report on 7 October 2010 and a summary of the report
can be found on our webpages. The final report should be available in March 2011.




                                      Important Reminders

 Expression of Wish option - Make sure we know who you would like any potential Death
 Grant to be paid to in the event of your death by completing an Expression of Wish form. Click here 
 for the form and more details on our web pages.

 Nominating Co-habiting partner option Have you been living with your partner for more
 than 2 years? Don’t forget to nominate them so that in the event of your death they can receive a
 survivor’s pension. Click here  for form and more details on our website. If there is no form lodged
 with us when you die, no survivor’s pension can be paid. There is no need to complete a form for
 married or civil partners.
 Pensionable Remuneration on leaving The pensionable pay used to calculate your
 benefits is usually your applicable pensionable pay in the last 365 days of your employment or if higher,
 one of the previous 2 years.

 However, if you have suffered a reduction (drop in hourly rate) in your permanent pensionable pay in the
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 10 years before leaving, you can choose to use the best 3 year average ending on 31 March (going
 back 10 years) if you think this will be higher.

    If you think this applies to you, you must notify Devon Pension Services in writing at least a
                                        month before you leave.

 A cost of living increase is added if using previous year’s pensionable salary figures.




                                            Contact us
Surname        Tel. No.                                                           Devon Pension Services
A – Dav        (01392) 688217                                                     Estuary House
Dava – Gill    (01392) 688216           Website: Devon Pension Services           Peninsula Park
Gilla – Man    (01392) 688215           www.devon.gov.uk/pensions                 Rydon Lane
Mana – Parr    (01392) 688214           Email: pensions@devon.gov.uk              Exeter
Pars – Z       (01392) 688213                                                     EX2 7XB

				
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