Any pension that you have built up until 31 March 2015 was added to your pension account when the new Scheme came into force on 1 April 2015. This amount will then become the opening balance of your pension account for the 2015/16 year (Year 1).
The pension you have built up before 1 April 2015 is calculated as:
Annual pension = Membership to 31 March 2015 x career average pay to 31 March 2015 / 60
Career Average Pay is the sum of each year’s pensionable pay, ending on a 31 March, uprated in line with the Consumer Price Index (CPI) and divided by the total membership in the Scheme.
Basic Allowance and Special Responsibility Allowance are the only elements of your councillor’s pay that are classed as pensionable.
Example
Mark has been a member of the Scheme since April 2010. He has 5 years’ membership under the 2009 Scheme and if he retires in April 2019 he will have 4 years’ membership under the 2015 Scheme. When Mark decides to retire in April 2019 he earns £10,000 per year, and his earnings have not changed since he joined the Scheme in 2010.
Membership from 2010 – 2015
Annual pension = 5 (years) x £10,000 / 60 = £833.33
£833.33 now becomes the opening balance under Year 1 of the 2015 Scheme.
Membership from 2015 – 2019
New pension savings per year – £10,000 / 49 = £204.08
| Year | Opening Balance | New Pension Savings | Total Pension Savings | Revaluation of 2% | Closing Balance |
|---|---|---|---|---|---|
| Year 1 | £833.33 | + £204.08 | = £1,037.41 | + £20.75 | = £1,058.16 |
| Year 2 | £1,058.16 | + £204.08 | = £1,262.24 | + £25.24 | = £1,287.48 |
| Year 3 | £1,287.48 | + £204.08 | = £1,491.56 | + £29.83 | = £1,521.39 |
| Year 4 | £1,521.39 | + £204.08 | = £1,725.47 | + £34.51 | = £1,759.98 |
Total Pension: £1,759.98 per Year
Mark will receive a total annual pension of £1,759.98 per year