Wednesday, February 14, 2007

LGPS - the detailed impact on the individual

UNISON has produced an excellent ready reckoner which members of the Local Government Pension Scheme (LGPS) can use to compare their pension entitlements under the proposed new LGPS. Check the relevant page on the website for guidance on using the ready reckoner.

This is a valuable resource but of course it does tend to make you look at the dispute from an individual rather than a collective perspective, as no socialist ever should (but of course I have…)

So if I have worked it out right this is what it means to me personally…

If I retire at 60 and choose to take the same lump sum as that to which I would otherwise have been entitled, my annual pension will be reduced by more than 10% for the rest of my life compared to what I would have had had I been protected.

If on the other hand I work until 65 I can earn the same lump sum as that to which I would otherwise have been entitled I will get a pension 4% higher than under the old scheme. I have to work until at least the age of 64 in order to be better off than I would have been prior to the abolition of the “Rule of 85”.

Of course I am old (well middle-aged). Were I a 20 year old who had started in local government on my eighteenth birthday I would stand to lose more than 20% of their pension on retirement at 60 under the new scheme, compared with what their entitlements would have been under the old scheme with the Rule of 85.

Current members of other public service pension schemes were protected and we aren’t being. If we settle for this we will be letting down our younger members in particular (including those as youthful as myself…)

Hands up again those who think this is a good deal?

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