Introduction

This section gives you information about your deferred benefits and includes answers to some of the questions you may have, such as are my deferred benefits increased every year, can I transfer my benefits and when will my benefits be paid.

What is a deferred benefit?

A deferred benefit is a pension benefit that is retained in the Local Government Pension Scheme (LGPS) until it becomes payable.  It consists of an annual pension payable throughout your retirement and a one off tax-free lump sum. They are then held in your local pension fund where they increase in value every year, until payment. Your pension will continue to receive cost of living increases every year, as it is paid to you - although special rules apply if your benefits are in payment before age 55.

Keeping in touch

It is important that you let us know if you change address so we can keep in touch with you whilst you are a deferred member and to arrange for the payment of your pension benefits when they become due.

Full details of how to notify us of a change of address can be found on the change of address page.

When will my deferred benefits be paid?

Deferred benefits normally become payable at age 65, unless you opt to defer payment beyond that age.

Can they be paid earlier?

Yes, your deferred benefits can be paid earlier for the following reasons:

• You elect to receive your deferred benefits, at or after age 60. Your pension will be subject to reductions if paid before age 65 to take account of early payment, although some or all of your benefits could be protected from the reduction if you joined the LGPS before 1 October 2006 and you are a protected member
• You elect to receive your deferred benefits between the ages of 50 and 59 with your employer’s consent.
• You can request early payment of your deferred benefits on the grounds of ill health at any age, without reduction, if you are no longer capable of performing the duties of your old job. You should contact your former employer to arrange a medical, if this applies to you.
• You can request early payment of your deferred benefits on compassionate grounds. Your former employing authority will have discretion to waive any reduction on compassionate grounds. The percentages will differ from those shown where benefits are paid with the former employing authority's consent before age 55.

Are my deferred benefits increased every year?

To protect their value your deferred benefits are increased in line with the Retail Prices Index which measures price inflation. These pension increases are not limited to a maximum percentage per annum as in many other occupational pension schemes. Details of the latest pensions increase can be found on the pensions increase page.

What will happen if I die before receiving payment of my deferred benefits?

If you die with deferred benefits in the LGPS, the following benefits are payable:

• A lump sum death grant – this is the value of your deferred lump sum at the date of leaving the LGPS plus any cost of living increases from your date of leaving to the date of your death.
• An ongoing pension for your husband, wife or civil partner , which will increase every year in line with the cost of living. In most cases, this pension is payable for the rest of their life.
• Children’s pensions for your eligible children – these increase every year in line with the cost of living and are payable to eligible children.

Details of how your benefits will be calculated if you become a deferred beneficiary on or after 1st April 2008, can be found on the deferred members - new scheme page.

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