Deferred members of the LGPS | Oxfordshire County Council

Deferred members of the LGPS

Information for members who have left the LGPS but not yet retired.

If you have left your employment, or decide to opt out of the scheme before your retirement age, the pension you have built up stays in the Oxfordshire County Council Pension Fund until:

  • you decide to transfer your pension rights to another pension scheme or,
  • you qualify for payment

This is called a deferred benefit. Leavers after 31 March 2014 need to have two years in the LGPS before being entitled to a deferred benefit. If you left the LGPS before April 2014, a deferred benefit is awarded after three months membership.

Leaving after 31 March with under 2 years membership but with membership predating the scheme changes puts you in a protected area. You may choose to have a deferred benefit because of the earlier protected status.

When you leave the scheme we will tell you about the value of the deferred pension. After that, we will send you a statement to show the current value of your deferred benefit each year.

The value we show on the statements is as if you could take that pension, unreduced on the statement date. However, the amount we can pay may be less if you request and are granted an early payment of pension. Conditions for early payment  - that is before your normal pension age - will be individual, and linked to your age at payment and when you left the scheme. In other words the regulations in operation when you left will determine when you can receive your pension, and any qualification rules.

For members leaving after 1 April 2014 whose deferred pension contains an element derived from the Career Average Revalued Earnings known as 'CARE' scheme, the revaluation for the pension account is at 1.2% at a second past midnight on the 31 March 2015.

In April 2015 the value of deferred pensions, where a pension has been deferred for at least one year before April 2015, increased by 1.2%

In 2016, the revaluation is a negative value but deferred pensions held in the fund for at least a year at 26 April 2015 will not be reduced while the active pension accounts are reduced by -0.1%  

This means people moving from an active pension account to deferred account between 27 April 2015 and 31 March 2016 will have a proportional reduction applied according to their date of leaving.  It is likely this notice will be included in the 2017 review with the overall effects of a very small reduction.

It is your responsibility to tell Pension Services when you change your address. When an annual statement is returned to us, undelivered, we will not send out further statements until you tell us your new address.

Your information and fair processing notice  

Every two years our pensioner payroll and deferred pensioner data is matched with secure national computer system. The Cabinet Office currently requires us to participate in its anti-fraud initiative. For this initiative, we provide details of deferred pensioners so that they can be compared to information provided by other public bodies. This will ensure, for example, that no pensions are due to be paid to persons who are deceased or no longer entitled, and that the benefits are paid accordingly to any descendants.

Sometimes wrong payments are made because of a genuine error. These exercises, therefore, help promote the best use of public funds. This is our formal notice to you about this regular process, you do not need to contact us about it.

If you have questions about this exercise, you will find more information at https://www.oxfordshire.gov.uk/cms/content/national-fraud-initiative.  Alternatively contact Pension Services for details

New job where you rejoin the LGPS or you are automatically enrolled into the LGPS by your employer

If you join the LGPS again after 31 March 2014, and the gap between membership of any  public services pension scheme is less than 5 years, the periods of LGPS membership should be linked automatically  to your new pension. You must tell your new administering authority that you have a pension within the Oxfordshire Pension Fund to start  the transfer arrangements.

If you did not want the periods to be automatically linked, you have to make a decision about keeping the periods of membership separate  within 12 months of starting your new job. This is also the rule even when changing jobs with the same employer.

The aim of the 2014 scheme was to keep pre 2014 membership tied to the ‘final salary’ definitions. While we wait for guidance from the Department for Local Government and Communities, you may want to postpone any final decision about whether or not to link your pension records if you have recently rejoined the LGPS. You do have a year, from the date you rejoined, before your final decision is due.

We do know that having a deferred pension and active membership does not mean two death grants should you die in service. Pension Services would be making full enquiries with the other funds where you may have a LGPS pension record to assess which fund will make the death grant payment.

New job outside of the LGPS

Pension Services will not automatically transfer your pension out of the LGPS. To start the transfer process, you must contact the administrators of your new scheme. We recommend you collect as much information as possible about the new scheme and what a transfer from the LGPS would mean before you agree to it. An independent financial advisor may help you review all options.

A transfer away from the LGPS should be carefully considered. Please be aware that there are unscrupulous ‘offers’ and scams. Do check the information on the Pensions Regulator’s website to help recognise the ‘scammers’ and their approach.

Freedom and choice

6 April 2015 is the effective date for reforms to workplace pensions which offer flexibility to individuals aged at least 55 in the way they access their pension savings.

It's important that as a member of the Local Government Pension Scheme (LGPS) you understand that you are a member of a public sector Defined Benefit (DB) scheme and therefore the flexibilities being introduced under 'Freedom and Choice' do not impact on how you can take your Defined Benefits from the LGPS.

There are, however, some indirect changes which will impact upon any members of the LGPS who are considering transferring the value of their accrued LGPS Defined Benefit pension rights from the LGPS to a DC arrangement offering 'flexible benefits'.

We have a leaflet, Q and A for LGPS members (pdf format, 139Kb), concerning transfers to a defined benefit scheme to help you understand these changes,   

When to claim your pension at retirement

The date for paying an unreduced pension will vary according to when you left the scheme. The date will be personal to you, however the LGPS regulations in force at the time you left the scheme, the level of protections you carry from earlier sets of regulations, and the effects of any other overriding regulations, will all have an influence.

In general Pension Services suggest you get in touch to investigate your options, request an estimate and then confirm your payment arrangements, starting this exchange at least six months before you expect to draw your pension.  This way you can plan your finances, knowing with certainty when your pension payment will begin and have time to consider any options.

However, it may be possible to pay a pension earlier, and sometimes you do not need the agreement of your former employer.  In very general terms a pension paid before the normal pension age is likely to be at a lower value.  (Remember you would be expecting to receive the pension for a longer period.) A pension paid after your normal pension age is likely to be increased. (You are putting off the payment, so we can add a little to the value.)

For leavers after 31 March 2014, normal retirement age (that is the date your deferred pension would be neither increased or reduced on payment) is linked to your individual state retirement age, but cannot be before age 65.

General guidance on payment if you leave the scheme on and from April 2014

Requesting early payment age 55-60

Between age 55 and under age 60, for you can choose to take early payment of your deferred benefits, if you left the scheme after 31 March 2014. You do not need your former employer’s consent to draw your pension before your Normal Pension Age, but you must apply in writing for Pension  Services to receive your request at least three months before your nominated payment date. 

Please note that the ‘nominated payment date’ is the date your pension would begin – not the date we would expect to make the first payment.  And your request must be made, and received, in the office here, at least three months before the date you want your pension to begin, the nominated date.

For example: if you want your pension to come into payment from your 60th birthday, and your date of birth is 1 October 1956.  The ‘nominated date’ or the date you want your pension to begin is 1 October 2016.  Your written request must be in the office and dated before 2 July 2016.

If your request is received late, for example on 5 July. Your pension will begin from 4 October, and no pension is due for 1-3 October.  

You can use this form

Your request for early payment here overrides any protections which may be in place, unless your former employer has switched on any ‘85 year rule’ protections  and/ or waived any reductions which might apply.  These are discretions the employer can use and will be in their published policy.

Your benefits will be reduced if there is no employer waiver policy. The reduction depends on how early you draw your pension  The reduction is based on the period between the date your benefits are paid and your Normal Pension Age. This is a new option only for scheme leavers after April 2014.

From age 60

You can ask for payment, giving the minimum three month’s notice of your nominated payment date to Pension Services. For leavers after April 2014, any protections built up in the scheme before April will be used on that membership automatically, pension built up from April 2014 will be reduced, reflecting the time between payment date and your normal pension age.

Please note that the ‘nominated payment date’ is the date your pension would begin – not the date we would expect to make the first payment.  And your request must be made, and received, in the office here, at least three months before the date you want your pension to begin, the nominated date.

For example: if you want your pension to come into payment from your 60th birthday, and your date of birth is 1 October 1956.  The ‘nominated date’ or the date you want your pension to begin is 1 October 2016.  Your written request must be in the office and dated before 2 July 2016.

If your request is received late, for example on 5 July. Your pension will begin from 4 October, and no pension is due for 1-3 October.  

You can use this form

As a guide, the percentage reductions issued  April 2016 show the reductions for early retirement in the table below. Where the number of years is not exact, we adjust the reduction percentages accordingly.

Appendix A: Factors

Table 1:Factors to use after age 55

No. of years paid early Pensions  reduction - Men Pensions reduction - Women Retirement Grant
Reduction (%)
All members
0 0% 0% 0%
1 5.6% 5.2% 2.9%
2 10.8% 10.1% 5.7%
3 15.5% 14.6% 8.5%
4 20.0% 18.8% 11.2%
5 24.0% 22.7% 13.7%
6 27.8% 26.4% 16.3%
7 31.4% 29.8% 18.7%
8 34.7% 33.0% 21.1%
9 37.7% 36.1% 23.4%
10 40.6% 38.9% 25.6%
11 44.2% 42.2% N/A
12 47.6% 45.5% N/A

Your former employer can agree to waive the  reduction. This is their discretion and you can ask your employer for details of their policy.

Pension you may have built up in the LGPS before 1 April 2014 may have protections in place. You can find out more about these protections in the leaflet ‘If You Joined the LGPS Before 1 April 2014.

At normal pension age, but no earlier than age 65

You do not need to make an early election for payment, but Pension Services will be in touch to find if you want to defer payment.

Payment of deferred benefits

Due to permanent ill-health

You can apply for payment of your deferred benefits at any age, without reduction if, because of your health, you would be permanently incapable of the job you were working in when you left the LGPS and you are unlikely to be capable of undertaking any gainful employment within 3 years of applying for the benefit or by your Normal Pension Age, whichever is the earlier.

Deferred benefits must be paid before age 75.  However, if your pension is not in payment at your state retirement age, 60 (women) / 65 (men), the GMP element (if any) of your pension must be paid from that date (unless you are still in employment). Do check with Pension Services to find out about what effects if any there may be in setting up GMP only payments.

After opting out the LGPS

We cannot pay your pension until you have left the employment in which you built up the pension that is now deferred. This will be the case whether you opted out before or after April 2014

Please note after April 2014 the scheme rules restrict payment of death grant

Only one death grant can be payable in the event you have separate periods of scheme membership.

After death

If you die before we start to pay your pension, there may be some benefits due from the Oxfordshire County Council Pension Fund, these may include:

  • a lump sum payment called a death grant
  • a pension payable to an eligible partner
  • pension to any eligible children.

To pay a partner's or children's pension, Pension Services have to be satisfied about eligibility and will request some documents such as:

  • death certificate
  • marriage certificates
  • civil partnership certificate
  • birth certificates
  • confirmation of cohabiting partnership

If you paid contributions as a member of the LGPS after 31 March 2008, other than as a councillor member, your co-habiting partner may be able to receive a pension after your death. Eligibility for a partner’s pension is decided when claimed, but a co-habiting partner must meet the conditions of the regulations and be able to prove financial co-dependence with you for at least two years before your death. If you left active membership before 1 April 2014, your pension record must already hold the co habiting partner declaration. If you leave active membership after 31 March 2014, your partner must have evidence to prove eligibility for a partner’s pension

We recommend everyone keeps their Death Grant and Expression of Wish direction details up to date. This information may help us determine who receives the death grant.

Your family will need to contact Pension Services immediately to inform us of your death.

NB. From April 2014, if you have an active pension record and also a deferred pension in the LGPS, there may be restrictions to the amount of death grant we, or the other fund can pay. We will make a full check of the entitlement before settling any payment.  

Further information

You may find that specific entitlements will apply to the regulations in operation when you left your employment. These notes can only give very brief information. To find out more, before making financial decisions, go to the national website  www.lgpsmember.org or contact Pension Services.

Annual Benefit Statements  Q and A

2016: We will start to send out the 2016 Benefit Statement at the end of July 2016.  The consumer price index was a negative figure in September 2015, which means the value of most deferred benefits will not change when compared to the previous year’s notice. 

I haven’t received my statement. What should I do?

If you are still waiting for a statement at the end of August, contact Pension Services.

If you have had a statement in previous years, have you changed your address? Make sure you tell Pension Services about your new address, we can take those details over the phone.   

If you have left the LGPS, over three months ago, but have not yet received a notice about your deferred benefit notice contact Pension Services

I have the statement but there are no details about a possible death grant, is this right?

The regulations have changed several times over the years, to find out about what might be due following your death please contact Pension Services

I want to change my expression of wish, how do I do this?

On the forms and guide page there is a form for you to printout, fill in with the new details (don’t forget to tell us who you are too) and send to Pension Services. We will change your pension record.   

The 2016 newsletter (pdf format, 435Kb) is again produced in collaboration with other LGPS funds. We will post the 2016 statement and newsletter together.    

Last reviewed
16 May 2017
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