April 2006
Welcome to the spring 2006 edition of the Newsletter tailored for pensioners of the Cheshire Pension Fund (the name of the Local Government Pension Scheme in Cheshire).
As ever pensions is the subject of great debate and is constantly covered in the media. We would like to re-assure you that as your pension has been calculated under previous legislation, any future changes will not affect the Local Government Pension Scheme you are receiving. From April the format and style of your annual payslip will change so we have included a guide to understanding your payslip together with a selection of frequently asked questions. Once again, we include our regular features such as pay dates, the annual increase for the year and contact details, together with a benefits update. We are also pleased to announce the launch of the Cheshire Pension Fund Website. As we continually aim to improve our service, your opinions and comments are important. Please feel free to contact us and let us know your ideas about what you would like to see in future editions. We look forward to hearing from you. Maggie Sheppard, Finance Manager Pensions County Finance Office
New Payslip format – from April 2006
Cheshire County Council has introduced a new computer system which includes changes to the payroll facility. From April 2006 the new system will be introduced for payments to pensioners. One of the more obvious changes will be the introduction of a new style payslip. Please see the article on page 2 “Understanding Your Payslip” for more information. Please also note: a) The example payslip shown is purely for illustration purposes. Descriptions of payments and deductions will vary depending on your personal circumstances. b) Details of payments due and deductions made will be shown in the relevant sections.
c) The boxes on the left hand side are for total amounts paid to date during the current tax year (from April to March) for certain categories of pay and deductions. c) The rectangle at the bottom of the payslip is used to provide you with additional relevant information when necessary. Please remember it is your responsibility to check the accuracy of your payslip, any inaccuracies should be communicated to the Pensions Section (please see section How to Contact Pensions on page 6). On page 3 there is a short Question and Answer section that will provide you with some additional information.
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Understanding Your Payslip
Here is an example of the new payslip format and some additional notes to explain certain parts of the payslip.
This is your new pensions payroll number. Please quote on all correspondance. Your Name and Address will be printed here. If these details change please inform Pensions.
89999999 8999999
Taxable Pay To Date - total taxable pay for the current tax year. Period - Shows the Income Tax Month used when calculating your tax liability e.g. April = 1 May = 2 Gross Pension before deductions
Pay Period End Date - Shows the end of period covered by the pay advice.
89999999
NET PAY
£
990.92
Net Pay Gross Pension less deductions
Payslip Reminder Don’t forget that you will only receive a monthly pay slip if your NET PAY changes by more than £1 from the previous month. You will of course still receive your pension every month. We are happy to provide written confirmation of your pension if you need it e.g. for benefit claims. You will still receive a P60 although this will be sent as a separate document and not attached to your payslip. PLEASE KEEP THIS SAFE. 2
Payslip Questions and Answers
Q. Why has my pensioner number changed? A. The eight digit pensioner number is a feature of the new Payroll System. This number will remain the same for as long as you receive a pension. Please quote this number in all correspondence with us. Q. Will my P60 still be attached to my payslip at the end of the financial year? A. No. In future this will be sent as a separate document, although you will receive your P60 at the same time of the year as you have previously. Q. Will my pension still be paid into my bank account on the usual day? A. Yes, your pension is paid to you on the 18th of every month except where the 18th falls on a weekend when the pension will be paid on the next working day.
Does the annual increase apply to my entire pension?
Increases prior to your State Pension Age (SPA). Up to your SPA all of your pension will increase and will be paid by the Cheshire Pension Fund. Increases after your State Pension Age (SPA) When you attain your SPA all of your pension will increase each April, however part of the increase will paid by the Cheshire Pension Fund and any balance will be paid with your State Pension. This is in respect of the Guaranteed Minimum Pension (GMP) earned prior to 1988 whilst you were a member of Cheshire Pension Fund.
What is a Guaranteed Minimum Pension?
In 1978 the Government Introduced the State Earnings Related Pension Scheme ( SERPS). Since 1978 members of the Cheshire Pension Fund have been ‘contracted out’ of the SERPS. This means that we agreed to pay you a Guaranteed Minimum Pension at your state pension age which is broadly equivalent to the amount you would have received from SERPS. How does the state pay the increase on my GMP? The State increase the pre 1988 GMP each April and the increase is paid with your State Basic Pension.
Pension Increase 2006
The annual pension increase for this year is 2.7%, which is payable from April 2006. The rate of increase is set each year by the Government by reference to the increase in the Retail Price Index over the 12 months to September. You will receive this increase if you are: • Aged 55 years or over, or • Receiving a widow’s, widower’s or child’s pension, or • Retired on ill health grounds If you do not fall into one of these groups, your pension will not attract this increase until your 55th birthday. Once you reach age 55, we will write to you to tell you the new rate of pension payable.
2006 Pensions Increase
The full increase is only payable if your pension began on or before the 25 April 2005. If your pension began after this date a smaller pro-rata increase will apply as shown in the table below. Pensions Beginning Before 26 April 2005 26 April to 25 May 2005 26 May to 25 June 2005 26 June to 25 July 2005 26 July to 25 August 2005 26 August to 25 September 2005 26 September to 25 October 2005 26 October to 25 November 2005 26 November to 25 December 2005 26 December to 25 January 2006 26 January to 25 February 2006 26 February to 25 March 2006 3 % 2.70 2.48 2.25 2.03 1.80 1.58 1.35 1.13 0.90 0.68 0.45 0.23
The pension pay dates for the coming year are;
2006/7 April 18 May 18 June 19 July 18 August 18 September 18 October 18 November 20 December 18 January 18 February 19 March 19
Frequently Asked Questions
Q 1. Who should I notify if I move house? You should notify the Pension Section as soon as possible in writing of your new address. This will be actioned and acknowledged, then passed to the Employee Service Centre. You also need to inform us if you change your name and please forward copies of any supporting certificates. Q 2. Who should I contact if I have a query about the tax I’m paying or my tax code? The HM Revenue and Customs (HMRC) sets or amends your tax code to a particular level. In the first instance these queries should be made to them, their telephone number is 0845 300 3939. You should have your National Insurance Number available and quote the Tax Reference 083/CCC (for Local Government). Visit the HMRC website at www.hmrc.gov.uk Single Female whose benefits were deferred before 6 April 1988 Married Male, whose marriage or civil partnership took place before retirement. Married Male, whose marriage or civil partnership took place after retirement
Q 3. Since I retired I have moved overseas, is it possible to have my pension paid in to my overseas bank account For those pensioners living abroad or who are planning to move abroad you will still receive your pension. Payments can be made direct to your overseas bank account using the Bank of Scotland facility T.A.P (Transatlantic Payment .S System). Your pension will be paid to your overseas account already converted into the currency of that country. Please contact the Pension Section for more information. Q 4. What benefits are payable to my spouse/ civil partner in the event of my death? Generally they will receive a pension for the first three months after your death at the same rate as your pension. After three months payment they will receive half of your entitlement for the rest of their life, but there are some exceptions so please check the table below, if you are affected. No spouses pension payable No widower’s or civil partners pension payable Half rate widow’s pension based on all Scheme membership. For civil partnership half rate pension based on Scheme membership since 6 April 1988 Half rate widow’s pension based on Scheme membership after 6 April 1978. For civil partners half rate pension based on Scheme membership since 6 April 1988 Half rate widower’s / civil partners based on all Scheme membership after 5 April 1988 by other public bodies e.g. those administering housing benefit, to ensure that occupational pension income is being declared. While the object of the exercise is the detection of fraud, any underpayments to pensioners are detected and then corrected. Please also remember that if you are a LGPS Pensioner re-employed by a local authority (this includes local Councils, Police, Fire, Probation, Magistrates Courts and FE colleges) you must notify the Pensions Section immediately. Your pension may be reduced if the sum of your new earnings in your new job added to your pension is greater than the earnings (plus inflation) on which your retirement pension is based. The Pensions Section is happy to give advice on the maximum you can earn without it affecting your pension. 4
Married Female / Civil Partnership
National Fraud Initiative (NFI)
The County Council is under a duty to protect the public funds it administers. From time to time it may use information provided to it for the prevention and detection of fraud and share it with other bodies administering public funds solely for these purposes. The County Council is required to participate in an anti-fraud initiative operated by the Audit Commission’s appointed auditors under section 6 of the Audit Commission Act 1998. For this initiative, we are providing details of pensions in payment to the auditors so that they can compare these with information provided by other public bodies. This comparison helps us to ensure that no pensions are paid to persons who are deceased or to those no longer entitled to them. The information is also used
Benefits Update - An update of topical news and information
The new tax allowances
Basic personal allowance For people aged 65-74: Personal allowance Married couple’s allowance (if either spouse born before 6.4.35) For people aged 75 and over: Personal allowance Married couple’s allowance (if either spouse born before 6.4.35) Important note: 2005/06 Annual allowance £4,895 £7,090 £5,905 £7,220 £5,975 2006/07 Annual allowance £5,035 £7,280 £6,065 £7,420 £6,135
For the age-related allowances shown above, there is an income limit for 2006/07 of £20,100. For every £2 of income above this limit, the personal allowance is reduced by £1, down to the basic level of personal allowance.
State Benefits from April 2006
Basic State Pension Dependent spouse Attendance Allowance Carer’s Allowance Income Support Minimum income guaranteed under Pension Credit Incapacity Benefit
Weekly benefit £84.25 £50.50 £62.25 £41.65 £46.95 £57.45 £90.10 £114.05 £174.05 £78.50
Higher rate: Lower rate: Basic rate Single: Basic rate Couple: Single: Couple: (Long term rate)
Digital hearing aids
All NHS Trusts in England and Wales now provide free digital hearing aids, following a campaign by the RNID. What’s more, batteries are free, you can be given a replacement hearing aid if you need one and you can return to the audiology department for repairs or help - all free of charge. If you think you need a hearing aid you will need to get your ears and hearing checked to confirm you have a hearing loss and to see if a hearing aid will help – your GP is the first stop. For further guidance, you can contact the RNID information line on 0808 808 0123 or visit www.rnid.org.uk 5
Bereavement Register
This is a free service set up to stop the distress friends and relatives feel when companies continue to mail loved ones who have died. It removes the names and addresses of the deceased from mailing lists. Relatives can register details through the Bereavement Register information helpline on 0870 600 7222, on the website at: www.the-bereavement-register.org.uk
Pensioners Guide
The Government is keen to help pensioners who miss out on the financial benefits to which they are entitled and have paid for through their taxes and National Insurance contributions. There are many leaflets designed to help you identify benefits you may be able to claim. These are available from your local Post Office, Benefits Agency Office or Citizens Advice Bureau. A useful publication to get hold of is the ‘Pensioners’ Guide’, with detailed information about the extra money available in retirement. It also deals with leisure opportunities, housing and home improvements, transport, legal services and crime. Phone 0845 6065 065 (local rate) for a copy or visit www.info4pensioners.gov.uk
How to Contact Pensions
We aim to provide an excellent administration service for all of our pension scheme members. To ensure that we monitor our progress we always welcome your feedback, about your experience in dealing with our Pensions Section. You can write directly to Maggie Sheppard, Pensions Finance Manager at the Pensions Section, Cheshire County Council, County Hall, Chester, CH1 1SG. If you have a specific query then please contact the appropriate number/ address below. Queries on the amount of your pension In the first instance please call the Pensioner Payroll Help Desk 01244 602125. Notification of bank account change For security reasons we cannot make this change from information provided over the telephone. Please put your details in writing to the Employee Service Centre at Cheshire County Council, County Hall, Chester, CH1 1SG. For notification of address changes Please do not telephone, write to the Pensions Section. Cheshire County Council, County Hall, Chester, CH1 1SG. We regret that changes to personal details can not be accepted over the telephone under the requirement of the Data Protection Act. Other Contact Details E-mail pensions@cheshire.gov.uk, please note that any personal detail changes can not be actioned via e-mail. FAX 01244 602087. For all other enquiries or if you wish to speak to a member of the Pensions Team you should telephone us on 01244 6001.
Internet Banking
If you use the internet for on-line banking, look at the website www.banksafeonline.org.uk. Here you can find the latest information on protection from the increasing number of fraudulent scams. Also, you can check with the FSA on 0845 606 1234 to see whether a bank is regulated in the UK.
TV Licences
The cost of a colour TV licence will increase to £131.50 from 1 April and for black and white to £44. TV licences are free to viewers from the month during which they reach 75. However, you still need to register. You can get more information from TV Licensing on 0870 576 3763. Anyone aged 75 or over is entitled to a free TV Licence, but will still need to apply for one. If you are registered blind you may only need to pay 50% of the full licence fee.
The Cheshire Pension Fund Website
www.cheshire.gov.uk/pensions December saw the launch of the Cheshire Pension Fund website. The site is designed for all Scheme members. The website has been created to provide quick and easy information about the pension fund. It is one of the ways in which we will keep you up to date with the latest pension news and updates on the Scheme, as well as information about the Fund’s investment and performance. We hope you find the website useful and any suggestions or comments you have will be most welcome, please contact us at: pensions@cheshire.gov.uk.
This information in this Newsletter can also be provided in large print, audio tape or Braille format if required.
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