I’m an LGPS pensioner what happens if I
get a new job?
If you get another job outside of local
government, with an employer who doesn’t
participate in the LGPS, your LGPS pension
is not affected. However, if you get a job in
local government or with an employer who
participates in the LGPS your pension may
be reduced. If you have a tier 3 ill-health
pension special rules apply - see your
pension award letter. If you have been
awarded compensatory ‘added years’ (CAY)
on top of your LGPS pension, there may be
permanent reductions in some
circumstances.
You must tell us about the employment,
whether or not you join the Scheme. If you
do not tell us, your pension may be overpaid
and you will have to pay the money back.
If you have taken ‘flexible retirement’ from an
employer and take up employment with a
different employer who offers membership of
the LGPS, the same rules apply.
www.direct.gov.uk/en/pensionsandretir
ementplanning/index.htm - useful
information and contacts for the over 50s
on a variety of topics.
www.citizensadvice.org.uk - The
Citizens Advice service helps people
resolve their legal, money and other
problems by providing free information and
advice from over 3,000 locations.
www.moneymadeclear.org.uk/pensions
- is from the Consumer Financial
Education Body established by the
Financial Services Authority and gives you
the facts about financial products and
services, helping you to make informed
decisions.
Your Pension is administered by:
LGSS Pensions Operations
RES1103, Cambridgeshire County Council
Shire Hall, Cambridge CB3 0AP
Telephone: (01223) 715445
Useful Information on the internet
www.lgps.org.uk – the LGPS National
Member Website with up to date information
about the LGPS.
www.pensionsadvisoryservice.org.uk providing information on your State Pension,
Pensions Credit, Winter Fuel Payments and
useful publications.
www.ageuk.org.uk - provides information
on a host of topics from money matters and
health to travel and lifestyle.
Email:[email protected]
Web: www.cambridgeshire.gov.uk/lgps
If you would like a copy of this newsletter
on audio cassette or in Braille, large print
or other languages, please contact the
Pensions Service.
Your Money
Welcome to the latest issue
of our newsletter for Cambridgeshire
pensioners of the Local Government
Pension Scheme (LGPS) and
Cambridgeshire Police and Fire Pension
Schemes. It is presented in a new format to
reduce the costs of printing.
In this newsletter you will find details of your
pensions increase for 2011, including the
impact of the change from using the Retail
Prices Index (RPI) to using the Consumer
Prices Index (CPI).
There are also a range of items keeping you
up to date with pensions news in general.
Your P60 will follow under separate cover.
Remember, for LGPS pensioners, we issue
pension payslips to everybody in March,
April and May. You will also get one in any
month your payment changes by £5 or
more, or your tax code changes.
Your 2011 Pensions Increase
Your pension is ‘index-linked’, this means
that it increases in line with inflation. In his
budget on 22 June 2010, the Chancellor
announced that from April 2011 the
Government was changing the way
increases in public sector pensions are
determined. The increase to your pension in
April 2011, and future increases, will be
based on the Consumer Prices Index (CPI),
rather than the Retail Prices Index (RPI).This
year the annual pensions increase in line
with CPI is 3.1%, from 11 April 2011.
This means your April payslip will only show
part of your increase. Your May payslip will
show the full effect.
If you are a retired member aged under 55
you will have to wait until you are 55 for your
pension to be increased, unless you retired
due to ill health and are receiving an ill
health pension. Both survivors’ and
dependants’ pensions are increased
regardless of age.
How are RPI and CPI calculated?
In calculating both RPI and CPI, the price of
a ‘basket of goods’ is measured and
although there are many similarities between
each index, there are also differences. The
CPI excludes a number of items mainly
related to housing, these include council tax
and a range of owner-occupier housing costs
such as mortgage interest payments.
Why has the change been made?
The Government’s Budget Report
states:“CPI provides a more appropriate
measure of benefit and pension recipients’
inflation experiences than RPI, because it
excludes the majority of housing costs
faced by homeowners (low income
households are subsidised separately
through Housing Benefit, and the majority
of pensioners own their home outright)”.
Over time, the CPI tends to have smaller
increases than the RPI.
What does it mean to you as a
pensioner?
As Scheme pensioners from April 2011,
increases will be based on CPI, your
previous increases are not affected.
What happens if you have a GMP?
Your payslip will show if you have a
Guaranteed Minimum Pension (GMP) in
payment. Cost of living increases
associated with the GMP elements of your
pension are not straightforward because
the Government pays some of it and it is
increased from the 6 April 2011. As a
result your GMP will not usually appear to
increase by the full 3.1%.
Income Tax
Even when you are retired you may have
to pay income tax. Income includes your
Scheme pension, State pension and other
pensions you may receive, wages from
other jobs and interest on some savings.
It is your tax code which tells us how much
tax to take from you, if any. Various
changes have already been announced to
tax allowances from 6 April 2011. You can
obtain these details at:
www.hmrc.gov.uk/rates/it.htm
If you think your tax code may be incorrect
or you need to get in touch with HMRC you
can write to them at:
HM Inspector of Taxes
Customer Operations, Room BP4009
Benton Park View, LONGBENTON
Newcastle NE98 1ZZ
or see their website:
www.hmrc.gov.uk/index.htm
Please quote your National Insurance
number and the appropriate reference:
LGPS:
120/C50150
Fire:
120/C50002
Police:
120/C50001
State Benefits
State benefits will also be increased. Details
can be obtained from your local Department
for Work and Pensions Office or at.
www.dwp.gov.uk/docs/benefitrates2011.pdf
Be aware that a combination of tax and
benefit changes may effect your tax
situation. Increases in state pension use up
some of your tax allowance. As a result you
may end up paying more income tax from
the pension we are paying you and the
actual amount paid to you may go down.
Have you got money worries?
If you are on a low income you can access
advice regarding available banking services
and affordable credit through a telephone
helpline. This is a Government initiative and
callers are referred to relevant local
agencies. To find out more:
Call 0191 224 7751 or visit:
www.dwp.gov.uk/other-specialists/nowlets-talk-money