Public Sector Pensions

Some 94% of public sector employees belong to DEFINED BENEFIT SCHEMEDEFINED BENEFIT SCHEME
Also known as a Final Salary Scheme. This is the traditional form of company or occupational pension in which your pension is calculated as a proportion of your salary in the last few years of work. The proportion you receive depends upon how many years you have been in your company scheme. – also known as final salary schemes – which have, up to now, guaranteed specific benefits on retirement, whatever market conditions prevail.  The recent drive to reduce Government spending has raised a serious question mark above the continuation of such schemes.  

Whether you’re employed by a Local Authority, the NHS, Department for Education, the Police, the Fire Service, the BBC or the Civil Service, your pension is likely to be under scrutiny by the current administration.

Payments to existing Public Sector pensioners come out of a pot made up of current employee and employer contributions topped up with funding from the taxpayer.   With tightening budgets and the likelihood of reductions in staffing levels, the amount that the Treasury will need to get from the taxpayer is set to increase substantially over the next few years.  It’s no wonder then, that moves are being made to close such schemes - forcing members to find alternative vehicles for their retirement savings. 

Scheme members are faced with some difficult decisions ahead.  Comparing defined benefit schemes with the alternatives – defined contribution schemes, based on the amount paid into the scheme rather than the benefits to be drawn out on retirement – is difficult.  Good independent advice will be critical to safeguard scheme members’ positions.

Our Pension advisers have expertise in both Public and Private Sector pensions and can help scheme members answer such thorny questions as:

• What is my Public Sector pension worth?
• Are the benefits I’ve accrued so far safe? 
• What happens if I retire before I’ve completed the qualifying years of service?
• Can I transfer my Public Sector pension into a private pension scheme?
• Is the alternative deal being offered to me worth as much as my current scheme?

Contact us to talk to one of our Pension experts about the options available to you.