Updated 12/05/06

FAQ's

top ten questions answered by our helpdesk >>>

See the list of topics covered by our additional information sheets >>>

Are there any questions you would like answered about the Local Government Pension Scheme (LGPS)?
If so, why not email us your questions and we'll publish the answers to the most common questions on this page.

Old age pension?
Q Can you tell me about my old age pension?

We are not responsible for the "State" or "Old Age" pension scheme.
This is dealt with by the Department for Work and Pensions. You can contact the Department for Work and Pensions or you can view the DWP website.
Click on the button below to visit the Department for Work and Pensions:

What's all this about that I should re join the state scheme?

Q I have been told that some insurance companies are saying you should rejoin the state scheme, should I leave the LGPS

A Warning Over Private Pensions
Legal & General, Prudential, Standard Life and Equitable Life are recommending that men aged 54 and women aged 49 should rejoin SERPS. This recommendation only relates to those individuals who ARE NOT members of a final salary occupational pension scheme which enjoys contracted-out status.

Those members of the Local Government Pension Scheme receive a pension which is calculated on their “final pensionable pay” and the benefits are GUARANTEED BY STATUTE. All existing members of the Local Government Pension Scheme are guaranteed to continue to be members of a final salary scheme, unlike many private sector companies where they have recently moved from final salary to money purchase schemes. Membership of the Local Government Pension Scheme continues to be the best mechanism for individuals making provision for their retirement.

This is the only Pension Scheme to which your employer can and does make a significant contribution.

What's all this in the press about "trust busting" can I get my hands on my pension now before I reach age 65?

Q What's all this in the press about "trust busting" can I get my hands on my pension now before I reach age 65?

"I have read in the press that my lump sum will be taxed...is this correct?"

Q "I have read in the press that my lump sum will be  taxed...is this correct?"
A Scheme member has asked if we have read recent reports concerning the HMRC draft proposal to tax lump sums.

Our understanding is that Ministers are considering a number of reports on reforming the tax regime including one submitted by the HMRC, which includes the taxing of lump sum retirement grants in excess of £50,000.
The impact of this to an individual would presumably be for amounts in excess of £50,000 to be taxed at the appropriate rate either 22% or 40% but we have no details other than what has been reported in the press.
We are aware that the National Association of Pension Funds, Society of Pension Consultants and the Pension Management Institution have all condemned the plan as it will discourage pension saving which is contrary to government policy.
We also understand that the Confederation of British Industry has approached the Chancellor of the Exchequer to reject the proposal which would be deeply unpopular with people and would undermine planning for retirement.
We must now wait to see what transpires but you may wish to consider writing to your Member of Parliament to express your concerns.

Mike Woodall
Chief Pensions Officer

Questions received regarding joining the scheme in relation to temporary contracts. . . .

Q What paperwork would I need to complete to join the Scheme and when I subsequently leave?
A Unless you indicate on the Scheme application form that you do not wish to join the Scheme you will automatically become a member of the Scheme provided you are not employed on a casual basis.  On subsequently leaving the Scheme, you will be informed of the amount of a refund, of your contributions.  You would need to confirm your acceptance of the payment and your nominated bank/building society account.  Alternatively you can confirm your new pension Scheme administrators to whom we can transfer your pension rights.

Q  Could I transfer-in other pension Scheme membership even though I will only be in the Scheme a short period of time?
A  You can transfer-in previous pension rights from another occupational pension Scheme or personal pension scheme at any time during your active membership of the Local Government Pension Scheme.  If such previous rights were transferred-in this would entitle you to pension benefits at your normal retirement age even if you have less than years’ Local Government Pension Scheme membership.  Membership with another Local Government Pension Scheme employer will count with your present employer if you wish to transfer it, any previous Scheme membership with a West Midlands Pension Fund employer would be automatically transferred unless your new job is on a lower rate of pay.

Questions received regarding the purchase of additional periods of membership.

Q What if I retire early?
A If you leave the Scheme for any reason other than (ill health) you will be credited with the proportion of membership you've paid for.   If you retire due to redundancy (or efficiency) you will be given the opportunity to pay off the outstanding balance subject to Inland Revenue rules. This payment may attract tax relief.

Q What if I retire through ill health or I die whilst in employment?
A In either case you can rest assured any outstanding contributions will be waived and the additional period being purchased will be credited in full.

Q Can I stop payments once they have started?
A Yes you can stop at any time and be credited with the proportion of membership you have paid for. However, when deciding how much to pay, you should choose an amount you can comfortably afford.

Questions received regarding the preserved benefit statements issued.

Q Can benefits now be transferred?
A cash equivalent transfer value is now available to preserved beneficiaries regardless of when the member left the Scheme. However, a transfer value cannot be requested in the tax year in which the preserved benefits are payable. To request a transfer value you should put in writing details of the new Scheme Administrators along with their address and contact details.  The   transfer value will then  be sent back to the member, but a questionnaire may be sent to the new pension scheme first.

Alternatively as a preserved beneficiary you could ask your new pension scheme to contact us direct.

Q Do the new regulations apply to my preserved benefit?
A Only if you rejoin the LGPS and elect to amalgamate the periods of membership.

Q When will the preserved benefits be payable ?
A At age 60 all preserved beneficiaries will be sent a letter by the Fund to inform you that :

your benefits are payable

If you are in another Local Government employment the preserved benefits cannot be paid until that employment ceases.

Q What if as a preserved beneficiary I become ill and wish to claim my retirement benefits early?
A You need to write to your previous employer who will send you to their Medical Adviser - revised contact details for you ex employer can be obtained from the Fund. If preserved benefits are paid early on health grounds because you have been found to be unable to do your previous job pensions increase is only applicable from age 55. Therefore the value of benefits at leaving shown on the preserved benefit statement would be payable and not the current value with pensions increase. If you were found to be unable to do any job then pensions increase would be payable regardless of how old you were.