31 July 2012
LGPS Issue no. 23
LGPS BALLOT STARTS TODAY!
MAKE SURE YOU VOTE!
UNISON’s ballot on the proposals for LGPS 2014 starts today and ends on
24 August. Members will receive their ballot papers over the next couple of days, so
please make sure you vote and remind other UNISON members to do the same.
Don’t forget that you can also vote on-line if you prefer. Your personal security code
and the web address for voting will be in your ballot paper.
HOW SHOULD I VOTE?
The Local Government, Police and Justice, Community and Water, Environment and
Transport Service Groups are all recommending that members in those Service
Groups vote ‘yes’ in the ballot.
The Higher Education Service Group is recommending its members to ‘vote no’.
HOW DOES LGPS 2014 COMPARE WITH THE CURRENT LGPS AND
THE GOVERNMENT’S PROPOSED ‘REFERENCE SCHEME’?
We have answered this question for you on the ‘Local Government Pension Scheme’
page on UNISON’s Pensions site. You can access the new tables here
http://www.unison.org.uk/pensions/calculations.asp
These new calculations compare the build up of your pension from 1988 under the
LGPS 2014 proposals, the current LGPS 2008 and what was the government’s
‘reference scheme’. They are based on a range of earnings – from the lowest to the
highest NJC pay point.
d:\533566752.doc
UNISON Protect Our Pensions LGPS campaign 23
The tables use actual NJC pay increases since 1988, CPI inflation up-rating for the
LGPS 2014 and LGPS 2008 and ‘average earnings’ up-rating for the ‘reference
scheme’ – as the government then proposed. This assumed that pay would outstrip
inflation by more than 100% each year, with CPI at 2% and average earnings
increasing by 4.25% - which the trade union negotiators considered an optimistic
projection in the talks on the LGPS 2014. The uprating in LGPS 2014 is therefore
CPI with an improved accrual rate.
LGPS 2014 OUTSTRIPS LGPS 2008 AND THE REFERENCE
SCHEME
It is clear from the tables that whatever you earn, the build up of your pension under
the LGPS 2014 with a 1/49 accrual rate and CPI inflation up-rating, is better than the
build-up in the current LGPS with a 1/60 accrual rate.
If your pay were to go up by 4% and CPI by 2.5% on average, you would have to be
in the LGPS for 30 years before the current scheme LGPS 2008 would have caught
up with the LGPS 2014. If your pay increases at the same rate as CPI in future, the
LGPS 2014 would be 22% better – regardless of length of service.
You can see from the tables that - at any scale point - the LGPS 2014 will produce a
bigger pension than the current scheme or the ‘reference scheme’ which would have
used average earnings increases to revalue your pension.
SO WILL I PAY MORE, WORK LONGER AND GET LESS IN LGPS
2014?
Pay more?
95% of members will pay the same as now in LGPS 2014. Part-time workers will all
pay less because LGPS contributions will be based on actual pensionable pay, not
the full-time equivalent.
You will only pay more if you earn over £43,001 – even then the increase is small
because of tax relief.
Work longer?
The Normal Retirement Age in LGPS 2014 will be linked to the State Pension Age
(SPA) – except for those protected at a lower retirement age. UNISON will continue
to campaign against the link with SPA which is now in the Civil Service, NHS,
Teachers and Local Government pension schemes.
However.....the current retirement age in the LGPS is already 65 and you can
choose not to work until the higher SPA after 2014. If you do continue until 66 or
beyond, you will continue to build up your pension during that period.
UNISON Protect Our Pensions LGPS campaign 23
2
You will still be able to retire at 55 with your employer’s permission or at 60 if you
choose to. In those circumstances your pension would be reduced by ‘early
retirement factors’, which we hope to improve in 2013.
Because LGPS 2014 has a much better accrual rate, the tables mentioned above
show that your pension will build up faster than in the current scheme, making it
easier for you to retire before the State Pension Age – or 65 as at present.
Get less?
The new tables on the website which are described above, show that you would be
better off on any pay point under the proposed LGPS 2014 using actual NJC pay
increases and CPI inflation rates from 1989 to the present.
In addition, your pension will be based on all your earnings, including noncontractual overtime and additional hours worked. This means that many members
will receive a higher pension.
RECRUIT AND ORGANISE!
The LGPS ballot provides a great opportunity for us to recruit new members and
UNISON stewards. Please tell people about the key role that UNISON played in the
negotiations over LGPS 2014 and use the special LGPS recruitment leaflet to sign
them up to UNISON.
There may also be members who would like to become ‘pension contacts’ in their
workplaces. If so, please tell Indira Patel on i.patel@unison.co.uk.
BUT WHATEVER YOU DO.......
MAKE SURE YOU VOTE IN THE BALLOT!
UNISON Protect Our Pensions LGPS campaign 23
3