How is my pension calculated?
Whether you’ve been in the Local Government Pension Scheme (LGPS) for just a short time or for a number of years, understanding how we work out your pension can be complicated.
Changes to the LGPS in 2008 and 2014 mean that if you joined the scheme before 2008, you’ll have membership under 3 different sets of rules.
When you draw your pension, our job is to make sure that you get the right amount based on when you’ve been a member of the scheme.
We break down your membership into three different blocks. Your pension for each period is worked out using different rules.
Membership from 1 April 2014
Benefits built up from 1 April 2014 are calculated on an annual basis and added to your pension account. Each pension year runs from 1 April to 31 March.
The benefits are calculated as follows:
Annual Pension = Actual salary / 49
When the pension is calculated at 31 March, it is stored in your pension account and revalued every year in line with inflation. You will then start a new pension year which will be calculated based on the pay you receive up to the following 31 March.
At retirement all the yearly pensions you have accrued (including the pensions increase) are added together and paid to you as a pension, which continues to increase in line with inflation for as long as it is payable.
Membership between 1 April 2008 and 31 March 2014
Benefits built up from 1 April 2008 consist of an annual pension with no automatic lump sum and are built up as follows:
Annual Pension = Final Pensionable Pay x Scheme Membership / 60
Membership before 1 April 2008
Benefits built up before 1 April 2008 are calculated as follows:
Annual Pension = Final Pensionable Pay x Scheme Membership / 80
Plus a lump sum equal to three times the annual pension.
This ensures that all benefits earned in the old scheme will maintain their value in the new scheme.