ursaminortaur wrote:DrBunsenHoneydew wrote:ursaminortaur wrote:
Only if he wanted to destroy the NHS by getting all the top doctors to retire early. Although their main complaint in recent years was about the annual allowance a number are already retiring early because of the LTA limit so changing the multiplier would almost certainly lead to many more doing so.
If they did change the multiplier there would likely be some form of "protection" at the implementation date analogous to what happened whenever the LTA itself was reduced.
I agree they should change it, perhaps to a more dynamic factor, e.g. 100 minus Age at Retirement Crystallization
The two types of protection which were available were
Individual protection which only applied if you already had more in your pension pot than the new LTA and which set your individual LTA limit to the minimum of the old LTA and the amount you had on the day the limit changed.
or
Fixed protection which allowed you to continue to use the old LTA limit but stopped you making any further pension contributions.
Taking either of those with a DB pension pretty much meant you had to defer the pension. Hence although such protections would be useful to the individuals involved providing something like them if the multiplier were increased probably wouldn't stop a lot of doctors retiring early.
I was in exactly this position.
When I took Individual Protection 2014 at age 55, the protected LTA figure awarded was based on what your DB scheme would pay out at its normal scheme retirement age of 60, assuming no further contributions.
But by retiring early at 57 say, without further contributions after age 55 the actual LTA used up would not be that protected amount because the pension taken at 57 would be actuarily reduced by about an eighth, because it will be paid for 3 extra years.
This gave scope to continue to pay contributions from age 55 to 57 to increase the actual LTA used by age age 57 back up to what it would have been at 60 without contributions.