How is it worked out?

Your pension builds up in a new way from April 2015, and you can see how this works by using our online tool for modelling your LGPS2015 pension here

Since April 2015 the LGPS has been a defined benefit pension scheme worked out on a career average basis. This means that your pension is worked out using a set formula. You build up a pension at a rate of 1/49th of the amount of pensionable pay you received in that scheme year (i.e. the main section of the scheme). The amount of pension you build up is added to your Pension Account at the end of each scheme year.  For any period you were in the 50/50 section, the pension you build up would be half your normal pension build up.

The example of Susan below explains how a pension is worked out in the Scheme.  You can also see further examples here.

Let's look at Susan :
 

 

 
 
Susan is in the main section of the Scheme from 1 April 2015 to 31 March 2016 and earned £24,500 in that year.
 
 
Scheme Year
2015/2016
Section of Scheme
Main
Rate of build up 1/49th of pensionable pay
Pensionable Pay £24,500
Amount of pension built up £500 (i.e. £24,500 divided by 49)
So, at the end of the scheme year, £500 is added to Susan’s Pension Account. To make sure the amount keeps it value, the total in the Pension Account will be adjusted in line with the cost of living. If inflation was, say, 3%, the £500 in Susan’s account at the end of the scheme year (31 March 2016) would be increased on 1 April 2016 to £515.
 
 
 
 
 
Susan is in the main section of the Scheme from 1 April 2016 to 31 March 2017 and earns £25,333 in that year. 
 
 
 
Scheme Year
2016/2017
Section of Scheme
Main
Rate of build up
1/49th of pensionable pay
Pensionable Pay
£25,333
Amount of pension built up
£517 (i.e. £25,333 divided by 49)
Pension brought forward £515
Pension Account Total £1,032
So, at the end of the second scheme year, Susan has £1,032 in her Account. As before, to make sure the amount keeps it value, the total in the Pension Account will be adjusted in line with the cost of living. If inflation was, say, 3.1%, the £1,032 in the account at 31 March 2017 would be increased on 1 April 2017 to£1,064.
 
If Susan had been in the 50/50 section during those two scheme years the amount in her Pension Account would be half the amounts shown above.
 
 

Remember you can still swap £1 of annual pension for £12 tax free lumpsum.  

Benefits built up to April 2015
Your benefits built up in the Scheme before April 2015 are protected and will be calculate on your membership to 31 March 2015 and your final pay when you leave. Only the membership you build up from April 2015 onwards is calculated under the rules of the new career average scheme.