Can anyone tell me what the definition of "current actives" is in relation to a final salary pension scheme please?
preferably an internet source explaining would be nice so that I can forward it on...tried looking on google and while plenty of schemes quote current actives they mention pensioners as well, as if its not that group of people.
"BigGirlsBlouse" wrote
They are the ones currently in active employment and (usually) paying contributions to the pension scheme. [If the scheme is non-contributory, then (obviously) they won't be paying contributions, but then they need to have joined the scheme, and also not subsequently "left".]
"BigGirlsBlouse" wrote
There are three types of scheme member : actives, deferreds and pensioners.
(1) Actives as above, (2) deferreds have left active service (eg left employment, but may just have "left" the scheme and stayed in the employment) but are not yet drawing their pension, (3) pensioners are drawing the pension.
Does that answer your question?
Bottom line is british steel pension scheme is being closed to new starters.... but it did consider changing scheme to DC for actives... wasn't sure if that meant members working or pensioners!...cos in 270 days I should become the latter!... (with good wind behind me)
"BigGirlsBlouse" wrote
You're welcome.
"BigGirlsBlouse" wrote
The change to DC would only apply to the future accrual of actives; their past benefits would become deferred (ie not changed to DC), and they'd then start accruing future DC benefits.
[If the scheme is generous, they could even leave a link to future salary on the past deferred benefits of actives, but that's a bit unusual.]Changes to DC never affect deferred or pensioner members.
Thanks, I will pass that on to my colleagues..... they even considered career average..that would have been a disaster when I think my first salary was £5 10s 00d From what I read thats the civil service pension have now. I worry for my daughter as shes in the local government scheme which converted from an 80ths to a 60ths in april 08 improving the benefits except getting rid of the 85 year rule...which hardly affected anyone, except those that started age 15!... going against the grain of reducing benefits elsewhere. Does make you wonder what they are up to!
"BigGirlsBlouse" wrote
Usually (I'm not even sure that I've seen one that hasn't!), career average schemes will "dynamise" past salaries - that means they uprate the older salaries to allow for inflation before averaging. So it's generally not so bad! [Except that the calculations can get quite complex...]
"BigGirlsBlouse" wrote
Don't forget that the extra lump sum (previously 3/80ths) is lost, though. Although, they can commute part of their pension into a lump sum... If they commuted the difference between 80ths and 60ths, they'd likely get more than 3/80ths lump sum, so it probably is an improvement still.
"BigGirlsBlouse" wrote
Actually, I've seen quite a few people who have been affected by Rule of 85 - eg start at age 41, can then retire at age 63 (22 yrs service + age 63 = 85).
But the Rule of 85 will still be applied to any pension accrued before 1/4/08 (and some future accrual for older members). And I think the 25-year-Rule (pre-4/1998 joiners) remains, doesn't it?
"BigGirlsBlouse" wrote
I think the accrual rate changes are fairly neutral (extra pension, but loss of additional lump sum).
The loss of Rule of 85 on future accrual will save them money, though...
25 year rule!!.... before my time mate. At British Steel Pension scheme we do have a 1 for 7 rule which provides up to an additional 5 years for any service which is 35 years or more. (years of actual (not pensionable) service divided by 7). This was frozen in 2006 to prevent further accrual. I am only really conversant on the british steel scheme...and have a passing interest in the LGPS due to a partner and daughter in the same scheme. What I can't understand is if the country is getting richer how is it we are getting less able to afford the pension we did have, which seemed to peak in the mid 90's? Is it all down to the c*ck up with the longevity calculation and Browns' dividend tax relief withdrawl or is there more to it? ........ and while I am on the subject I am always interest in the background of those who seem to be knowledgeable about a subject....which brings me to the point Tim where does your expertise arise?... mine is merely a well informed member soon to be pensioner whose father was a chartered accountant (not that that had anything to do with it... or maybe it has, hence my interest in the subject)
"The country is getting richer"? For how long have you been on a desert island? :-)
Even during the boom period, the GDP per person stayed about the same.
"BigGirlsBlouse" wrote
Probably less of a "c*ck up" and more an unexpected, very dramatic improvement in longevity from about 10-20 years ago. Who would have foreseen that?
"BigGirlsBlouse" wrote
Over twenty years of actuarial experience in life & pensions. ;-)
"BigGirlsBlouse" wrote
Sorry Ron... I meant to add before October 13th 2008!
I take the point about people living longer.... but its nothing new. My grandfather who was a member of the united steels pension scheme died aged
80 in 1965, and he wasn't unusual. Maybe its all the blood presuure tablets and statins that all us oldies are now taking which is successful at not killing off a few more of heart disease at young age?BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.