© GMB Local Government Pensions Update Proposed New Scheme: LGPS 2014 GMB Presentation

© GMB Background Coalition’s 3 fold attack: Change to pension indexation from RPI to CPI 50% increase in member contributions to the LGPS through the Osborne Pension Tax Hutton report advocating increased retirement ages and reduced benefits Talks started across the public sector with government proposing 1/100 th accrual rate for all public sector schemes (except their own which remains 1/40 th ) GMB campaign to distinguish LGPS due to real risk of mass opt outs November 30 th Day of Action ‘December Principles’ for Union-LGA LGPS negotiations agreed by government

© GMB LGPS Negotiations Treasury Proposal DCLG Proposal Negotiated Proposal CARE scheme 1/60 th accrual1/70 th accrual1/49 th accrual Individual pension age link to state pension age Immediate pension age rise to 66 then state pension age Individual pension age link to state pension age 9.6% average member contribution 8.5% average member contribution 6.5% average member contribution

© GMB Contributions Annual Actual Salary Headline/Gross Contribution Contribution After Tax Relief Less than £13,5005.5%4.40% £13,500 – £21,0005.8%4.64% £21,001 - £34,0006.5%5.20% £34,001 – £43,0006.8%5.44% £43,001 - £60,0008.5%5.10% £60,001 - £85,0009.9%5.94% £85,001 - £100, %6.30% £100,001 - £150, %6.84% More than £150, %6.88%

© GMB Benefits I Defined benefit career average scheme 1/49 th accrual and CPI revaluation Individual pension age linked to state pension age (minimum age 65) Contributions and pensions based on actual salary (inc overtime) Contribution flexibility with 50/50 option Outsourced members to retain membership of LGPS

© GMB Benefits II 50/50 section of the LGPS 2014 is for members who would otherwise opt out of the LGPS While in the 50/50 section, members: Contribute half the main scheme rate (on average 3.25%) Build up pension with a 1/98 th accrual rate LGPS 2014LGPS 2008 Basis of Pension Average Pay Over Career Revalued by Inflation Final Salary Accrual Rate1/49 th 1/60 th Revaluation RateCPIN/A Pension Age Individual pension age = to state pension age (minimum 65) 65 Contribution Flexibility – 50/50 Option Yes, members can pay 50% contributions for 50% of the pension benefit No

© GMB Retirement No scheme retirement age in LGPS 2014 Members can retire at anytime after 55 Pension taken before the individual’s state pension age will be reduced; pension taken after will be enhanced Future changes in state pension age will apply to all service in the LGPS 2014 (excluding protected service built up before April 2014)

© GMB Protection All service before April 2014 is protected - linked to final salary and existing retirement age Rule of 85 transitional protection will be honoured ‘Better of’ calculation for members aged 57 – 59 when the new scheme starts

© GMB Further Information Detailed Guides to New Scheme Frequently Asked Questions