1. Changes to the Teachers’ Pension Scheme 1 April 2015 “At a Glance Guide to who is affected”

2. Who is affected? Members who have full protection - These are members who were active immediately before 1 April 2012 and who were within 10 years of their Normal Pension Age (NPA) on that date. These members will remain in final salary. Members who have tapered protection – These are members who were active immediately before 1 April 2012 and who were within a further 3.5 years of their NPA on that date. These members will remain in final salary for a tapered period of time until they then move into career average on their “transition date”.transition date Transition members – All other existing members will enter career average on 1 April 2015. New starters - Join career average on entry if they start teaching on or after 1 April 2015. Pensioner and deferred members are not affected by the changes unless they take up further employment. The tables below highlights the changes from 1 April 2015.

3. TPS Pre 2007TPS 2007TPS 2015 Teachers’ Pension Scheme design. Final Salary Career Average Accrual Rate (The formula or rate of “accrual which uses service and /or salary to work out your pension benefits) 1/80th pension plus automatic lump sum 1/60th pension 1/57th pension which is increased each year the member is in service by indexation plus 1.6%. If a member is deferred (out of service) the increase is by indexation only Pensionable pay used in calculation of benefits Average pensionable earnings Pensionable earnings for each year now including overtime

4. Normal Pension Age6065 NPA equals State Pension Age (SPA) or 65 where that is higher Flexibilities Additional pension from 1 January 2007 Additional pension 3 options: Additional pension, faster accrual and buy out of actuarial reduction Lump Sum Automatic lump sum = 3 x pension No lump sum but can convert part of pension to receive an optional lump sum Death Grant (one off payment where a member dies before becoming entitled to their pension) 3 x final average salary (Active member) 3 x final salary at date of death (Active member) Phased Retirement From 1 January 2007 the opportunity to take 2 phased retirements before final retirement Opportunity to take two phased retirements before final retirement Opportunity to take three phased retirements (2 before aged 60) before final retirement Actuarial Adjustment (where benefits are been taken before NPA) Benefits actuarially adjusted by approximately 5% for each year they are taken early Benefits actuarially adjusted by a fixed 3% for each year they are taken early subject to a maximum of 3 years

5. EMPLOYEE TIERED CONTRIBUTIONS – 1 APRIL 2015 Member contributions are based on their salary, so the more they’re paid, the higher their contributions. From 2015 the new member contribution rates are shown below: Annual rate of pensionable earningsMember’s contributions rate Up to £25,9997.4% £26,000 to £34,9998.6% £35,000 to £41,4999.6% £41,500 to £54,99910.2% £55,000 to £74,99911.3% £75,000 and above11.7%

6. Further communications will be issued shortly, providing more detail on how to calculate and what is and isn't included. Please ensure that members are aware of the changes to their contributions. Part-time members - changes In the past, for someone working part-time, you looked at the row corresponding to the member’s full-time equivalent salary. From April 2015, this will change; instead, you’ll look at their actual part-time earnings. For example, if someone worked 50% and had a full time equivalent salary of £50,000, their actual earnings would be £25,000. Under the old structure, the member would pay 10.2% of £25,000. Under the new structure they’ll pay 7.4% of £25,000. Those working overtime In the Career Average arrangement (but not the Final Salary), overtime is included in the salary used to work out the contribution amount but not in working out which tier to use. Based on the example above if someone was in the Career Average Scheme and earned £1,000 of overtime, they would pay 7.4% of £26,000. (Please note that the £1,000 overtime doesn’t change the contribution rate).

7. And finally……. Employer Contributions The contribution rates for employers are: 14.1% from 1st April 2015 until 30th August 2015 inclusive 16.4% plus an administration charge of 0.08% from 1st September 2015 (16.48% in total) Croydon TP Team November 2014