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Scheme benefits

About the benefits of joining the Local Government Pension Scheme.

Secure pension

The scheme provides you with a secure future income, independent of share prices and stock market fluctuations. Your pension will also receive annual cost of living increases.

Tax-free lump sum

All membership built up before 1st April 2008 is ‘banked’ and used to provide an automatic tax free lump sum. There is no automatic tax free lump sum for service built up after 31st March 2008, however, when you retire you will be given the opportunity to give up part of your pension in return for a tax free lump sum. 

Employer contribution

Your employer currently pays the balance of the cost of providing your benefits after taking into account investment returns. Every three years, an independent actuary calculates how much your employer should contribute to the scheme. The amount will vary, but generally your employer will contribute two thirds of the scheme's costs and the employee contributes one third.

Peace of mind

Your family enjoys financial security with life cover and a pension for your spouse, eligible cohabiting partner and eligible children, in the event of your death while contributing. If you ever become seriously ill and you've paid 2 years of contributions (met the vesting period), you could receive immediate ill-health benefits. The LGPS provides a death grant, which is a valuable protection for your dependents in the event of your death.

Freedom to choose when to take your pension

Once you have met the 2 years vesting period, you can choose to retire and draw your pension at any time from age 55 and receive your benefits immediately, although they may be reduced if paid before your Normal Pension Age. 

Made redundant or retired on grounds of efficiency

At or after age 55 you will receive the immediate payment of the benefits you've built up, provided you've met the 2 years vesting period.

Flexible retirement for employees

If your are age 55 or above and your employer consents and you've met the 2 years vesting period, you could reduce your hours or move to a less senior position and draw your benefits – helping you ease into retirement. Your benefits may be reduced for early payment. Learn more

Flexibility to pay less contributions

You have the option to pay half your normal contributions in return for half your normal pension. This is known as the 50:50 section of the scheme and is designed to help members stay in the scheme when times are financially tough.

Flexibility to pay more contributions

You can also boost your pension by paying more pension contributions. You get tax relief on these too.