About Your Benefits

If your contributory service in the Scheme ended before your pension was due to start, you will have benefits ‘preserved’ in the Scheme for payment when you reach pensionable age. These preserved benefits are called deferred pensions. This section of the website tells you about your deferred pension.

How your benefits were worked out when you left service

After you left service you were sent a statement showing the value of your deferred pension. The statement showed:

• the value of your benefits calculated using your contributing service and pensionable salary at the date you left service
• the value of any extra benefits you earned if you paid contributions on overtime payments, attendance bonus payments or additional attendance payments
• if you left through redundancy and had the option to pay part of your redundancy pay into the Scheme, the amount of pension purchased if you took that option
• if you paid family benefit contributions, the benefits payable to your dependants in the event of your death
• the age at which your pension will start to be paid. If you left after 1 April 1996, the statement would also have shown the value of Bonus Augmentations. References to pensions and benefits on this website are to Guaranteed Benefits only unless there is a specific reference to Bonus Augmentations.

Increases to your deferred benefits before retirement

Your deferred pension will increase on 1 January each year in line with the increase in the Index of Retail Prices for the 12 months to the end of the previous November.

Bonus Augmentations

Your deferred pension may also increase if there are future valuation surpluses which enable the Trustees to improve benefits by awarding Bonus Augmentations. Deferred Bonus Augmentations will be kept separate from the rest of your deferred pension entitlement.

Bonus Augmentations have been awarded with effect from 1 April 1996, 1998, 2001 and 2007. The 2009 actuarial valuation of the Scheme found deficits in the Guaranteed Fund and the Bonus Augmentation Fund. This resulted in the ‘standstill’ provisions in the Rules being brought into effect. This meant that the level bonuses awarded before 2010 were converted into reducing bonuses. The ‘core’ Guaranteed Benefits were unaffected and continued to increase each year in line with the increase in the Retail Price Index (RPI). The conversion of the bonuses into reducing bonuses led to a Bonus Augmentation Residue which the trustees were able to use to mitigate the effect of the bonuses reducing by awarding replacement bonuses for each year in 2011, 2012, and 2013.

There are now two types of Bonus Augmentation:

Reducing bonuses – these are bonuses awarded before 2010. Following the 2009 valuation these bonuses reduce each year when the Guaranteed benefits increase by RPI. The reduction each year is equivalent to the increase in the Guaranteed benefits.

Level Bonuses – these are the replacement bonuses awarded after 2010.

An example of how pension increases work in relation to Guaranteed benefits and Bonus Augmentations can be found in the Pensions in Payment section of About Your Benefits.

Keeping you up to date about your deferred pension

An up to date statement of benefits will be sent to you every year usually by the end of May.