LG DB Pension Annual CPI Uplift
Posted: March 11th, 2024, 10:54 am
At the end of May this year I will be able to start claiming my local gov db pension and so I have obtained the forms to request commencement of payment.
Together with the forms there is a covering letter indicating the annual pension amount and the lump sum payment. Both figures are this (old) financial year's whereas, because my payments commence in the new year, and since they already know the applicable CPI uplift, I was anticipating that I would be quoted new financial year figures. I wasn't concerned about the annual amount as I figured this would be auto uplifted along with everybody elses'.
My concern was receiving last years quoted lump sum which would be £2k less in my pocket than after applying the CPI increase.
When I called to query this the lady I was speaking to stated that I would not receive an uplift on my lump sum despite it being paid in the new financial year but throughout our conversation she seemed worryingly uncertain and lacking any conviction in her responses. When I queried it further she advised me that I might want to seek independent financial advice I explained that this query, which was related to their pension rules, was a matter for them to answer, not a financial adviser and at that point I asked to speak to someone else who could give a clearer idea of what the situation is.
She put me on hold saying that she would speak with someone else before coming back to me and advising that not only would the lump sum not have the CPI % uplift applied, but neither would the annual payment because increases are only applied to members' pensions when they have been claiming for more than 12 months.
This seems illogical to me since if I hold off claiming for a month or two my pension statement will undoubtedly reflect the new uplifted figures as it has in every past year. If I have to I'll do that but I don't think I should have to so does anyone with an LG pension have any knowledge about this?
We ended the conversation with me requesting links to official guidance which confirms this advice that no CPI uplift applies until 12 months after first claiming.
Together with the forms there is a covering letter indicating the annual pension amount and the lump sum payment. Both figures are this (old) financial year's whereas, because my payments commence in the new year, and since they already know the applicable CPI uplift, I was anticipating that I would be quoted new financial year figures. I wasn't concerned about the annual amount as I figured this would be auto uplifted along with everybody elses'.
My concern was receiving last years quoted lump sum which would be £2k less in my pocket than after applying the CPI increase.
When I called to query this the lady I was speaking to stated that I would not receive an uplift on my lump sum despite it being paid in the new financial year but throughout our conversation she seemed worryingly uncertain and lacking any conviction in her responses. When I queried it further she advised me that I might want to seek independent financial advice I explained that this query, which was related to their pension rules, was a matter for them to answer, not a financial adviser and at that point I asked to speak to someone else who could give a clearer idea of what the situation is.
She put me on hold saying that she would speak with someone else before coming back to me and advising that not only would the lump sum not have the CPI % uplift applied, but neither would the annual payment because increases are only applied to members' pensions when they have been claiming for more than 12 months.
This seems illogical to me since if I hold off claiming for a month or two my pension statement will undoubtedly reflect the new uplifted figures as it has in every past year. If I have to I'll do that but I don't think I should have to so does anyone with an LG pension have any knowledge about this?
We ended the conversation with me requesting links to official guidance which confirms this advice that no CPI uplift applies until 12 months after first claiming.