Single Scheme Superannuation Benefits
The Superannuation pension was introduced on 1st January 2013 across the public service for all new entrants.
There are over 100,000 members of this scheme across all departments of which 80% are members of the Health and Education sectors.
Similar to the old Pre 2013 Scheme, Employees are entitled to;
*However the way in which these benefits are calculated differ substantially.
1. Superannuation Pension Scheme
The pension is a Defined Benefit scheme. Employees are entitled to;
a tax free lump sum and
a pension income
Employee’s benefits are based on career average earnings and work pattern. Benefits are accrued annually based on earnings in that year. In other words you ‘bank’ your earned pension benefits into your pension pot each year.
Normal Retirement age is the same as age for Contributory State Pension (68).
The Upper retirement age is 70.
Benefits increase annually in line with the Consumer Price Index/Inflation
They are entitled to Cost neutral early retirement from age 55.
Tax Free Lump Sum = Gross Pensionable Salary/Remuneration x 3.75%
Pension = Gross Pensionable Remuneration x 0.58% (up to State Pension threshold)
Gross Pensionable Remuneration x 1.25% (above the State pension threshold)
Please note that the member is also entitled to the Contributory State Pension
All of the above figures are brought in line with inflation each year (Consumer Price Index)
Gross Pensionable Remuneration
The Gross Pensionable Salary/Remuneration is a very important calculation each year for new entrants. The pension benefits are worked out each year and banked into your pension pot. In the old scheme, all of the calculations were complete on the members Final Pensionable Salary. This was more beneficial as all of their service were calculated on a higher salary (the top grade available in that position etc). New Entrants however do not have this luxury as the calculations are completed each year……..
The calculation is as follows;
Gross Pensionable Remuneration
Any Pensionable Allowances that are permanent in nature and have been notified to the member as pensionable.
Cost Neutral Early Retirement
Subject to employer approval, a scheme member is eligible for Cost Neutral Early Retirement before reaching the Normal Retirement Age
Cost Neutral Early Retirement:
only available to standard accrual members
member must be 55 years of age or older to be eligible to apply
member must be vested in active employment (deferred members ineligible)
Retirement benefits are calculated up to the date of early retirement and actuarially reduced in line with approved actuarial rates
Benefits are reduced permanently to take into account member age at retirement and the time remaining until the member’s Normal Retirement Age
A CNER calculation tool and other resources are available in the Retirement Toolkit
Ill Health Early Retirement
Active member eligible to retire on medical grounds once eligibility requirements met (e.g. medical assessment, employer approval)
Ref: Guidance Note 1 of 2017 and Section 29 of Public Service Pensions (Single Scheme and Other Provisions) Act 2012
Benefits payable differ depending on whether member is vested or not
Deferred members may be eligible to apply for Ill Health Retirement benefits before the Normal Retirement Age
2. Death in Service
The Life Cover/Death-in-Service is as follows;
Twice Pensionable Remuneration in 12 month period prior to death is paid to the member’s estate. If working part time benefits is based on the member’s full time rate.
The Spouses pension of the deceased member is as follows
50% of pension that would have been paid to the deceased if retired on medical grounds at date of death.
Please not that the Pension payment ceases the surviving spouse remarries cohabits or enters into a new Civil Partnership.
The Children’s pension is as follows
Fraction of Deceased’s Pension Payable.
Spouse & 3 or fewer. 1/6th payable per child
Spouse & 4 or more. 50% of deceased’s pension divided by number of eligible children & payable per child
No spouse & 1 child. 1/3rd of deceased pension
No spouse & 2 or more ½ of deceased pension & payable per child
3. Sick Pay Entitlements
The sick pay entitlements is the one Superannuation entitlement that carried over from the old scheme. Please CLICK HERE for more information.