The NHS Pensions Choice Joint Representatives Conference Verity Lewis RCN Employment Relations Department

b;ahldldldlld Your NHS Pension Choice u Introduction - The Why, Who and What of “Your NHS Pension Choice” u How/when will Choice be offered? u Key considerations for Your NHS Pension Choice (and the health warnings) u The role of RCN representatives

b;ahldldldlld Why do you have an NHS Pension Choice? u Public sector pension reform – government proposals to end final salary and increase pension age to 65 u Public Sector Forum Framework – achieved what you said was most important - retain final salary scheme and NPA 60 for existing staff u NHS Pension Review – 1 April 2008

b;ahldldldlld Who has a pension choice? u England and Wales – members of the 1995 section who are actively contributing to the scheme on 1 October 2009 u Scotland – deferred until January 2010 u Ireland – 1 October until 31 January 2009 u NEWSFLASH – special arrangements for some – more later

b;ahldldldlld What is “Your NHS Pension Choice?” u Remain in 1995 (“Old”) Section – or u Transfer to 2008 (“New”) Section and move all your past and future benefits to the 2008 section N.B. Moving to the 2008 section means your pension will accrue at a higher rate and your retirement age will be 65

b;ahldldldlld Choice Terms u All members under 60 – one year in the 2008 section for one year in the 1995 section u Those aged 60 and over at the time of choice - terms that progressively reduce the number of years of service given in the 2008 section for each year in the 1995 section. u minimum lump sum equivalent to 3/80ths times the service they transfer is mandatory u MHO members will only be able to transfer actual years of service u IHR – special conditions for 12 months after transfer to 2008 section

b;ahldldldlld Over 60’s Choice Terms u Sliding scale u Factors change at end of each full month of attained age u Examples –59 years 11Months (1.0) –60 years 0 mths ( ) –70 years 11mths ( )

Main Differences between the sections Feature1995 Section2008 Section Normal Pension Age 60 (55 for special classes) 65 Minimum Pension Age50*55 Accrual Rate1/801/60 Final PayBest of last 3 yearsAnnual Average of best 3 consecutive in last 10 Flexible Retirement Voluntary protected pay (new) Partial retirement (draw down) Pensionable re- employment * 55 for members starting for the first time on or after 01/04/2006 or returning on or after that date with a previous leaving date of on or before 30 March 2000

b;ahldldldlld Key dates for choice in England and Wales EVENTDATE New Pension Arrangements Effective 1 April 2008 Effective Date for Choice 1 October 2009 Choice for Retirees 1 July 2009 Choice for Early Adopters 1 July 2009 National Rollout Begins January 2010 Exercise Complete31 March 2012

b;ahldldldlld Disclosure Issues in England and Wales from 1 July 2009 u Disclosure obligation falls on employers u Ensure people are able to make an informed choice u Key people affected –Early retirees – before October 1 –Ill health retirees –Special Class members approaching 65 th birthday –TUPE transfers

b;ahldldldlld The important bit – what scheme members need to think about u The wider issues related to retirement planning u The specific issues about “your NHS Pension Choice”

b;ahldldldlld Attitudes to retirement vary Eager anticipation Meticulous preparation Dread Laissez faire approach

b;ahldldldlld Retirement a new chapter, not a new book u Still part of your life plan u You will have the same needs and preferences as you did during working life u Analyse those to see what you need to make your retirement all that you want it to be u PERSONAL CHOICES

b;ahldldldlld 4 common elements u Finances – income, pensions, savings Cutting your cloth – or weaving more u Health and well being Physical and psychological u Interests and activities This may even include employment! u Relationships and social networks Necessary social interaction, but how will it be different?

b;ahldldldlld Your NHS Pension Choice – key issues to consider u Aspirations –How long you want to work –How you want to work –Who you want to/will be working for u Key elements of the NHS Pension Scheme –Normal Pension Age –Accrual Rate –Flexibilities –Partner Pensions –‘Health Warnings’

b;ahldldldlld Information and guidance for Scheme Members u Payslip leaflet (England & Wales) u Choice Pack – personalised choice statement –Explanatory booklet –DVD –Choice Form u Additionally –FAQ’s –Helpline –Special factsheets –Modellers

b;ahldldldlld Examples of NHS Pension Choice products in E&W Poster Comparison leaflet Leaflet Statement

b;ahldldldlld Information for Scheme members u It is a personal choice. Beware of others’ well- intentioned opinions – no one can tell you what is the best choice for you u The problem of the crystal ball – no-one knows what tomorrow brings u Finally – it is an important choice but you will have all the information and support you need

b;ahldldldlld Role of RCN Representatives in Choice u Information signposting u Not advising u Working in partnership with employers to develop appropriate procedures to support disclosure u Encouraging/supporting data cleanse u Performance Management under any agreed process

b;ahldldldlld For further information u The NHS Pension Scheme is administered by NHS Pensions, a Division of the NHS Business Services Authority, and its web site can be accessed at u Choice specific communications are available u See also NHS Employers’ website u Guidance and tools on Age Diversity including “Developing an Age Strategy”