A new NHS Pension Scheme is being introduced from April this year. It has a retirement age of at least 65.
NHS Pension Scheme members will receive a leaflet in their January or February payslip with information on the new scheme.
The move means that members of the current scheme may need to make a choice about about the pension they earn up to April 2015.
There are two sections to the current NHS Pension Scheme – the 1995 section and the 2008 section. The 1995 section has a retirement age of 60, the 2008 a retirement age of 65.
Members of the 1995 section of the NHS Pension scheme without full protection – ie those who will join the 2015 scheme at some point – are being given the opportunity to move their 1995 benefits to the 2008 section of the scheme in an exercise is known as Choice 2.
This affects about about half a million scheme members and the pension they’ve earned up to April this year.
While they will be able to claim their 1995 section pension benefits at 60, they will only be able to claim 2015 scheme benefits at that age with a big reduction for early payment.
So many people may choose, or need, to carry on working.
If people are likely to work until they’re at least 64, then a move to the 2008 scheme is likely to be financially beneficial to them as the 2008 scheme has a better pension build-up rate than the 1995 section.
Members have until 16 March to make the decision.
This is a quite technical, and therefore difficult, message to get across to members.
But they need to know they may not be able to afford to retire at 60 – and if they have to carry on working anyway they may be better off switching sections for their service before April 2015.
Members can find more information on the NHS Pension Scheme, its sections and the Choice 2 exercise in the dedicated UNISON Knowledge section of the website.
