Pensions In Practice

Issue: 7
Date: October 2015
Pensions In Practice
(PIPS) “Your monthly review of NHS Pensions from Fairway Training”
In 1965 the Righteous Brothers, in
arguably their biggest hit single,
famously sang the line “Time goes by
so slowly and time can do so much”.
Well, in the fast moving and fast
paced world of GP Practices, NHS
payroll and NHS Pensions, that line is
completely untrue! It is more like
time goes by so quickly and time can
do so much!
So an apology from Fairway Training
because we have not been as ‘on the
ball’ as we should have been. As a
Fairway Training client the review of
the
NHS
Pension
Employer
newsletters through our newsletter
PIPs should have been a bit more
prompt. So belatedly this edition of
PIPs concentrates on the April to
October 2015 Newsletters.
2015 Scheme
April saw the launch of the long
talked about 2015 Scheme - it is
finally here! NHS Pensions have been
working hard at ensuring information
is available and it’s worth noting that
there are a number of videos that
have been produced by NHS
Pensions which contain very basic
but helpful information.
They are:
Video 2:
Features and benefits of the 2015
Pension Scheme
Video 3:
People with benefits in both the
1995/2008 Scheme and the 2015
Scheme
Video 4:

Members of the 1995 Section of the
1995/2008 NHS Pension Scheme
Video 5:
Members of the 2008 Section of the
1995/2008 NHS Pension Scheme
Please click on the links above to
view. We also covered this topic in
some depth in our March 2015
edition of PIPS which can also be
downloaded here.
Fairway Training Ltd
Specialists in NHS Pensions & Payroll
Administration and Training
www.fairwaytraining.com
Newsletters in summary
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April
-
May
-
June
-
July
-
August
-
September
-
October

Fairway News

Fairway Training Courses
Issue: 7
April Newsletter
Date: October 2015
Life Time Allowance
Membership in the 2015 Scheme
The following is a direct extract from the newsletter:
Employees who automatically moved to the 2015
Scheme on 1st April, because they had no protection
either in the 1995 or 2008 Sections , will now have a
new employment ID showing a start date of 1st April
2015. The membership record up to 31st March was
‘closed down’ with a new exit code of 15. This is to
show the employment is continuing but under new
NHS Pension Scheme regulations and officially this is
known as ‘linked employments’.
The Chancellor of the Exchequer delivered his final
Budget of this Parliament on 18 March 2015. In it he
confirmed the reduction of the Lifetime Allowance
(LTA) from £1.25 million to £1 million with effect from
6 April 2016. From 2018, the LTA will be increased
annually in line with the Consumer Price Index (CPI).
We are assuming the same will apply to those
employees with tapered protection when they
eventually move across to the 2015 Scheme. You can
check the status of your employees’ protection
arrangements on Pensions Online under notifications
and protected eligibility notifications.
As this means that more NHS Pension Scheme
members will be affected in the future, the Chancellor
announced that an additional transitional protection
for pension rights already over £1 million will be
introduced alongside this reduction. We will update
employers further once details about the new HMRC
protection have been confirmed.
Jargon Buster
An updated version (V4) of the Jargon Buster has now
been published on the home page of the NHS Pensions
website (under 'Quicklinks for Members') and now
includes new terms such as ERRBO. Don’t forget that
this is a living document so if you have any suggestions
for content you would like to see included please email
[email protected]
Calculating whole time equivalent pay for part time
Officers.
The March 2015 newsletter contained a controversial
change to the method used for calculating notional
whole time pay for part time staff. Along with other
NHS organisations we raised an objection to this as
there had been no change to the regulations. NHS
Pensions confirmed that they were reviewing the
guidance issued and employers should continue with
the current method. To date no further information
has appeared on this topic!
Final Pay Controls
NHS Pensions confirmed that they had received
(unsurprisingly) a number of queries regarding this
subject. For a full explanation of how Final Pay Control
works, please download our December2014 edition of
PIPs or the Final Pay Control Fact Sheet.
Fairway Training Ltd
Specialists in NHS Pensions & Payroll
Administration and Training
Issue: 7
Date: October 2015
May Newsletter
Giving up Protection
2 x the revalued pensionable earnings for the Scheme
year, up to 10 years earlier, with the highest revalued
pensionable earnings.
Before the introduction of the 2015 Scheme it was
recognised that some 2008 members may prefer not to be
protected against moving to the 2015 Scheme due to the way
benefits are accrued e.g. higher accrual rates in the 2015
Scheme (this topic was covered in the March 2015 Edition of
PIPs). Members of the 2008 section with full or tapered
protection can opt to forgo their protection. Individual
members would have received letters to their home address
if they had this option. No 1995 members were affected by
this.
In addition NHS Pensions also confirmed that ‘The lump
sum must be claimed and paid within two years of the
member’s death being notified to the Scheme
Administrator. After two years the lump sum will become
an unauthorised payment which is not a permitted
payment under the 2015 Scheme.
N.B The formal exercise ended on 30th September 2015.
Payment of Pension Contributions
It is apparent that some GP Practices (approximately 1500)
do not use Pensions Online to submit details of their monthly
pension contributions which then triggers a Direct Debit
payment. We strongly recommend that this method of
payment is utilised as late payment fines can be and are being
issued. It is a statutory requirement that employers must pay
contributions by the 19th of the following month in which
contributions are deducted. As it can take time for payments
to be processed Fairway recommends making payments via
Pensions Online no later than the 14th of the month.
Should you need any help or assistance in setting this up
please contact the Fairway Training helpline if you are a
support client or your usual Fairway contact if you subscribe
to our pension administration service. For payroll clients this
is dealt with automatically as part of the payroll service.
Death Benefits
Confirmation was received that if an active 2015 Scheme
member dies in service, the 2015 rules for ‘death in service’
apply irrespective of the fact that the member may have
1995 or 2008 membership. The calculation is based on the
higher of either:
2 x the relevant earnings in the last 12 months of pensionable
service (this could be extended after the date of death if
there is entitlement to untaken annual leave); or
Disclosure of pension information by electronic copy
NHS Pensions have confirmed that under the
Occupational and Personal Pension Schemes regulations
2013 that:
‘Information may be given by an electronic
communication where the trustees or managers of the
Scheme are satisfied that the electronic communications
have been designed so that the member will be able to:



get access to, and
store or print the information, and
take into account the requirements of disabled
persons.
This means that you do not have to issue hard copies of
guides/booklets in all instances. However, it is not
sufficient to simply provide a link to the NHS Pensions
website. Where you are certain the member is able to
store and/or print the guide/booklet then you can email
the information to the member ensuring you provide an
attachment of the full document. Employers should be
aware that, where an individual requests, in writing,
that such information should not be provided
electronically, a hard copy should be provided.’
Further information can be found at:
Joining the Scheme:
http://www.nhsbsa.nhs.uk/Pensions/799.aspx
Leaving early:
http://www.nhsbsa.nhs.uk/Pensions/4195.aspx
Fairway Training Ltd
Specialists in NHS Pensions & Payroll
Administration and Training
Issue: 7
June Newsletter
Date: October 2015
July Newsletter
Pensions Online update
Requests for Estimates
When the revised version of Pensions Online was ‘switched
on’ in April 2015 it was not possible to access membership
history records for 2015 members. This has now been
rectified.
NHS Pensions confirmed that estimates of pension
benefits were taking longer than normal due to
‘unprecedented’ increases in workload.
In addition as part of the Additional Pension review, the new
updated Additional Pension (AP) calculator is now available
for purchases in the 1995/2008 Scheme and 2015 Scheme.
Additional Benefit Contracts and the 2015 Scheme
After receiving a number of enquiries, NHS Pensions have
confirmed that members who are paying for either Added
Years, Additional Pension or a bigger survivor pension,
contributions should continue as normal until the end of the
contract. The only time it would not continue is if there was
a break of 12 months or more in pensionable employment.
As a reminder, 1995 section members can claim their Added
Years or Additional Pension benefits at the contract end date
whilst continuing as an active member of the 2015 Scheme.
As a reminder Pensions Online (POL) can produce
estimates for both 1995 and 2008 members with full
protection. By full protection we mean that they will not
be transferred to the 2015 Scheme at any point. If a
member has been or will be transferred to the 2015
Scheme, POL is currently unable to provide an estimate
of benefits at retirement age.
However, members can ‘self-service’ a benefit
statement using the Annual Benefit Statement (ABS)
facility. This will of course only produce a statement of
benefits earned up to 31st March 2015. ABS is a
component of Total Reward Statements (TRS). The full
TRS function is only available to Trusts, CCGs etc.
Early Retirement Reduction Buy Out (ERRBO)
There has been a bit of confusion about the new ERRBO
facility so NHS Pensions sought to clarify some issues.
Estimates for Ill Health retirement
A new version of form AW295 is available on the NHS
Pensions website for 2015 Scheme members only. 1995 and
2008 Scheme members should use the current form. The
Estimates page can be found at:
http://www.nhsbsa.nhs.uk/Pensions/4109.aspx
Employer’s Charter
Confirmation that a new charter is now available and we
covered this extensively in our last edition of PIPS.
Expressions of Interest (EOI) received from today’s date
and until 31st March 2016 will be for contracts starting in
the new financial year, in other words no new contracts
can be set up before 1st April 2016. However, the whole
process is under review. The full ERRBO factsheet can
be downloaded here if you are unsure what an ERRBO
contract is!
Please be aware that the GP1 on POL has now been
amended to include an ERRBO contributions box. Please
ensure pension contributions are allocated to the
correct boxes.
Fairway Training Ltd
Specialists in NHS Pensions & Payroll
Administration and Training
Issue: 7
AW8 forms
Date: October 2015
August Newsletter
If a member is retiring and they have membership in
more than one Scheme, i.e. they have membership in
any combination of the 1995, 2008 or 2015 Schemes, the
AW8 cannot be submitted via POL and the paper copy
must be sent to NHS Pensions.
It is very important that it is clearly marked to indicate
which Scheme benefits are being claimed from.
Annual Benefit Statement (ABS)
Confirmation that the Annual Benefits Statement would
be available after 31st August and 30th October
depending on which part of the country you were in. By
the time you are reading this both dates will have
passed.
Choice 2 ‘sweep up’ exercise
Payment of NHS Pension Contributions
There was a further reminder about timely payment of
contributions (see May newsletter summary). This is
clearly an issue and Practices are reminded not to leave
payment of contributions until it’s too late. The absolute
deadline for completing your GP1 via POL is at least two
working days before the due date (the 19th of the month)
and not later than 3pm. Of course if the 19th falls at a
weekend, the deadline date will be the 17th. N.B See
Fairway’s recommendation on page 3 above.
There is a final exercise in this respect which will end on
1st December 2015. This only affects members of the
1995 section, some of whom are being given the option
to move to the 2008 section. Apparently there were
about 13,000 employees who had not been identified as
being eligible in the original exercise. If you receive any
questions about this please direct your employee to the
Choice 2 webpage.
Pension Finance web page
Additional Pension
A new web page is being launched specifically dedicated
to all aspects of payments etc. The Pensions Finance
page has information regarding the article above and
also historic contribution rates etc. Feedback and
comments are being sought and you can do this by
emailing [email protected]
The re-costing exercise has taken place as part of the
review process. This has resulted in amended values for
employees with Additional Pension (AP) contracts. NHS
Pensions have confirmed the following:

Newsletter for members
Members can now sign up for a newsletter dedicated to
current employees and employees with preserved
benefits. This can be done by visiting the members
newsletter page.
Retirement booklet
Version 19 of the Retirement booklet is now available.
As a reminder this should be given to all staff who apply
for Scheme benefits.


If there has been an increase to the cost of an
AP contract this will not be backdated to 1 April
2015 but the new monthly figure should be
collected from the member from the
September 2015 pay run onwards.
Increases will be capped at a maximum of 5%
for this year with any remaining increases
commencing from 1 April 2016.
If there has been a decrease to the cost of an AP
contract, this will be backdated to 1 April 2015,
so you will need to make arrangements to
return contributions to the member to recover
the overpayments (you will receive a letter from
NHS Pensions instructing you to do so).
If you haven’t already done so you should make the
changes in your next payroll process.
Fairway Training Ltd
Specialists in NHS Pensions & Payroll
Administration and Training
Issue: 7
September Newsletter
2014/2015 Certificate of Pensionable Income
Although this does not directly affect your members, it
is very important that your GPs, Salaried GPs, single
handers and shareholders complete this certificate and
submit it to the relevant Employing Authority by 29th
February 2016. All the relevant information can be
accessed here. Unfortunately this is not something that
Fairway Training can offer any assistance with.
Date: October 2015
SHA2 certificates. This needs to be actioned by 1st
December 2015. The suggestion from NHS Pensions
is that you won’t be able to access their website or
Pensions Online if you are not compliant.
Retention of records
NHS Pensions have clarified that under Regulation 18 of
the Registered Pension Schemes (provision of
Information) Regulations 2006 (SI 2006/567/) that
amongst other things pension documents must be
preserved for the tax year to which they relate and for a
period of 6 years following that year.
However Fairway Training recommend that records are
kept as long as possible as we are aware of a number of
queries going back longer than the legal requirements.
Entering key data into Pensions Online (POL)
NHS Pensions have emphasized how important it is
to take care when entering key data via POL such as
bank details. Typically these are entered when
completing forms AW8 and RF12. A few instances
have occurred of incorrect payments being made and
payments to members subsequently being delayed.
Auto Enrolment for small and micro NHS Employers
October Newsletter
Connecting to NHS Pensions’ website and online
tools
NHS Pensions have announced that the way you
connect securely to websites is changing. This is part
of a global change whereby software providers such
as Google, Microsoft, and Mozilla etc. will no longer
accept SHA1 protocol website certificates. NHS
Pensions are therefore changing all of its website
certificates to use “the proven SHA2 standard” and
this will be implemented in early December.
There is a reminder about the requirements of auto
enrolment for GP Practices. Fairway Training has
produced a number of guides for our clients.
If you are a payroll or pension administration client
you will have automatically received a guide or will
in due course receive one if your staging date is not
imminent. If you are a support member you can
request a guide by contacting the Fairway Training
helpline. This will give you full details of how auto
enrolment works and example letters that can be
adapted to your specific requirements.
We are not intending to sound like we actually
understand this as essentially it is an IT issue!
However, it is vital that you check with your IT
department (if you have one!) to ensure that your
systems meet the requirements for accepting the
Fairway Training Ltd
Specialists in NHS Pensions & Payroll
Administration and Training
Issue: 7
Date: October 2015
Updated Documents
There are a few revised forms and booklets available which
can be downloaded by clicking on the link below or requesting
hard copies via the stationery store (0300 123 1002).
After many years of using our current and very much
outdated database and website we are pleased to
announce that a brand new website has been
commissioned. We have listened to feedback we
have received and we will try to make your browsing
experience more enjoyable!
We will be vastly improving the ‘member area’ of the
website to ensure that you have all the information
available to assist you in your administration of the
NHS Pension Scheme. The aim is to make this area a
‘one stop shop’ for all your booklets, forms and
factsheets.
AW8 (V20)
PD2 (V13)
The website will have a fresh, modern and user
friendly look about it and will incorporate the latest
technology. We are pleased to be working with a
local design company who we have worked with
previously and are excited about this project. Watch
this space!
2016 Course dates announced (see last page)
Who Should Attend?
1995/2008 Scheme Guide
(V15)
Retirement Booklet (V20)
This is a full one day course aimed at those staff
within an organisation who are responsible for the
NHS Pension Scheme administration (either new to
the post or in need of a refresher course), thus
making Practice Managers and/or Administrators
aware of procedures & requirements in the day to
day running of the Scheme (Please note as per the
NHS Employer’s Charter ‘outsourcing does not
remove an organisations accountability under the
scheme regulations’). Delegates will receive
comprehensive training ensuring they have the
knowledge to tackle the complexities of NHS Pension
Scheme administration with more confidence and
have an awareness of their responsibilities (covered
within the NHS Pension Scheme Employer’s
Charter).
Transfer in Guide (V14)
Fairway Training Ltd
Specialists in NHS Pensions & Payroll
Administration and Training
Issue: 7
Date: October 2015
Booking
To book a place on the course please download a booking
form by clicking here. When completed please send to
[email protected]
NHS Pensions – The Essentials
About the Course
Topics Covered







Employer responsibilities under ‘The NHS Pension
Scheme Employer’s Charter’
An overview of Scheme documentation
Scheme Joiners and Leavers – Disclosure of
Information
Day to Day Administration Issues
The Impact of Auto-Enrolment on NHS employers
The New 2015 Scheme – Arrangements beyond April
2015
Understanding the essentials of Pensions Online
Coffee and registration from 9:00am with a start at
9:30am. Lunch will be provided, plus morning and
afternoon refreshments. The seminar will conclude no
later than 4:30pm. Delegates will receive full
documentation.
We welcome your feedback and you can review us at:
http://practiceindex.co.uk/gp/fairway-training-ltd
Cost
Members: £150.00 + VAT / Non Members: £175.00 + VAT.
Editorial Team:
Andrew Shirley
Daniel Bott
Stephen Blake
Fairway Training Ltd
Specialists in NHS Pensions & Payroll
Administration and Training