These pages are for employer use only. Member information can be found on the home page.
A scheme member or the employer can elect to make extra contributions towards the member’s retirement in number of different ways. These are described below along with what you need to do in each circumstance:
Additional Pension Contributions (APCs)
Members have the option to purchase extra scheme pension at full cost to themselves up to a maximum of £6,755. If the member has more than one employment the total cannot exceed these limits. The member has the choice of either paying a lump sum or a regular amount into an APC to provide a pension for themselves. APCs do not include a pension for a survivor in the event of death. Please refer any scheme member who is interested in this option to the APC calculator where they can work out the cost of purchasing additional pension and can print off the required forms.
This arrangement must cease if the member elects to join the 50/50 section of the Scheme.
Please note: There is a difference in how to process members electing to buy additional pension benefits, from members who are buying back lost pension to cover a period of absence.
Where APCs are used to but back lost pension for a period of absence, after the member has generated the application form provided by the APC calculator on the LGA website, this application form should be submitted to you as the employer. However, where APCs are used to purchase additional pension, the application for should be submitted to the Pension Fund.
Additional Pension Contributions (APCs) – Extra pension purchased by employer
Employers can use APCs to purchase additional annual pension on behalf of a member. Your approach to this area should be outlined in your employer’s discretion policy.
These APCs can be paid to employees currently contributing to the LGPS, and a maximum amount of £6,755 of additional pension can be purchased. Such an award can also be made to a former employee within six months of leaving their employment on the grounds of redundancy or business efficiency.
If you were to grant an Employer only APC, the cost of the APCs would depend on the age and gender of the employee, and the amount of pension to be purchased, which would be paid by you as a one off lump sum payment.
If this is an option which you are considering, please visit the LGA website where an online calculator is available to help you work out the cost.
Additional Voluntary Contributions (AVCs)
The Shropshire County Pension Fund has a group “In-House” AVC scheme with both Equitable Life Assurance Society and Prudential, although the Equitable is now closed to new contributors.
We use Prudential as our current AVC provider. If an employee wishes to start an AVC with the Prudential they need to contact them directly. To find out more about paying AVCs, members can call the Prudential directly on 0800 032 6674 or visit their website.
Once the member has set up the AVC you will be sent a schedule which will outline how much to deduct, the start date and how to send the payments to Prudential. This must be given to your payroll department to set up the deduction.
Equitable Life can be contacted on the following telephone number 0870 607 6791 quoting reference ‘E0096 / GV13’. Most dealings with Equitable Life are conducted through Pensions Services.
In addition to the in house schemes, members can contribute to Stakeholder/ Personal pensions or Free Standing AVC schemes. Arrangements for these schemes are not the responsibility of employers.
Other additional contributions contracts
Some members may have set up under old regulations any of the following:
- Added Years (buying additional membership)
- Additional Voluntary Contributions (AVCs)
- Additional Regular Contributions (ARCs)
- Additional Survivor Benefit Contributions (ASBCs)
- Preston part-time buy-back
These continue from 1 April 2014 under the same rules as before and on the terms of the contract when they were originally taken out. For added years and ASBC contracts these will continue to be deducted as a percentage of the 2008 definition of Pensionable Pay.
It is essential that if a member contacts you as their employer, to express a wish to cease a contract for the purchase of Added Years or ARCs, that you contact pension services providing a copy of the members written request.
A letter will then be issued to you from pension services and the member’s record amended.