New 2015 Pension Scheme

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17 / 10 / 2014 00:00 AM

From 1 April 2015 there will be a new NHS Pension Scheme.

The scheme is currently under design and more information will be published in a regulatory consultation in autumn 2014. The details of this consultation will be published on our consultation webpage once available. The scheme design is being carried out in line with the principles outlined in the proposed final agreement.

New 2015 NHS Pension Scheme webinars

In preparation for the new 2015 NHS Pension Scheme, NHS Employers and NHS Pensions are hosting a series of four webinars for employers. The webinars will provide further information at each stage ahead of the new scheme implementation on 1 April 2015. The first webinar was held on the 18 September 2014 and you can now view the slides and listen to the audio. We encourage you to attend the future sessions to build your knowledge before the new scheme arrives. Read more, book your place or view existing slides.

Comparison of the existing NHS Pension Scheme and the new 2015 scheme

NHS Pensions has published a useful comparison of the features and benefits of the existing 1995 and 2008 sections of the NHS Pension Scheme and the new 2015 NHS Pension Scheme. The comparison includes information on the age at which members can retire and differences in how the pension and lump sum are calculated at retirement. The document is available to view on the NHS Pensions website.

Update on scheme reforms and contribution rates – information for employers

More information has been made available in a document published by the Department of Health (DH) outlining proposals for the detailed design and transitional arrangements for the new 2015 scheme.

We have summarised the key points for employers below:

Member contribution rates

The table below sets out the member contribution rates which will remain in place for four years from 1 April 2015 to 31 March 2019. 

These rates will be payable by all members of the 1995 and 2008 Sections as well as the new 2015 scheme.

Whole Time Equivalent (WTE) 
Pensionable Earnings/Pay 

Contribution Rate

≤ £15,431

5.0%

£15,432 - £21,477

5.6%

£21,478 - £26,823

7.1%

£26,824 - £47,845

9.3%

£47,846 - £70,630

12.5%

£70,631 - £111,376

13.5%

≥ £111,377

14.5%

Employer contribution rate

The employer contribution rate has been set at 14.3 per cent from 1 April 2015. 

You can find out more on our employer contribution rate webpage.

Features and benefits comparison

The document includes a summary table showing the features and benefits of the 1995 and 2008 Sections and the new 2015 scheme, including:

  • The new 2015 scheme is a Career Average Revalued Earnings (CARE) scheme, with benefits based on a proportion of pensionable earnings during the members' career.
  • The new 2015 scheme has an accrual rate (ie, the rate that your pension builds up) of 1/54th of each years' pensionable earnings. This is a higher accrual rate than both the 1995 and 2008 sections.
  • The new 2015 scheme has a revaluation of active members' benefits in line with the Consumer Price Index (CPI) plus 1.5 per cent per annum.
  • Normal Pension Age (NPA), at which benefits can be claimed without reduction for early payment in the new 2015 scheme will be linked to the same age as a member is entitled to claim their state pension.

Protection arrangements

Full Protection - members who are within ten years of the Normal Pension Age (NPA) as at 1 April 2012 will continue to participate in their existing (1995 or 2008) section until retirement.

Tapered Protection - members who are between 10 years and 13 years and 5 months of NPA at 1 April 2012 can continue in their existing (1995 or 2008) section for a period of time (called tapered protection).

The document contains tables that show members age at 1 April 2012 and 1 April 2015 and the date at which their tapered protection will end and they will switch to the new 2015 pension scheme.

Access the update on scheme reforms and contribution rates

You can download the information document from the Department of Health website.

Further information and resources

We have produced a range of materials to support employers through the transition to the new arrangements:

You will find a series of frequently asked questions for the 2015 scheme on the NHS BSA website.

DH has also published a range of calculators to enable NHS Pension Scheme members to estimate future benefits for the proposed new scheme.

If you would like any more information please contact Stephanie Leary, pensions programme lead, on 0113 306 3213.


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