Issue - meetings

The Head of Human Resources and Organisational Development advised Members of the main changes to the Local Government Pension Scheme (LGPS) regulations for 2014 and recommended a revised Early Retirement Policy which set out how the Council as an employer within the Clwyd Pension Fund could apply the new 2014 discretions for employees.

From 1 April 2014, ‘normal pension age’ for the purposes of the LGPS was linked to ‘state pension age’ and would not normally be before age 65.  Under the new scheme, employees could opt to retire at aged 55 without the consent of their employer and could gain access to their LGPS pension.  The pension would be reduced by a set amount depending on how many years before ‘normal pension age’ an employee wished to retire.  The reduction in pension would be equivalent to the cost of early payment of the pension and lump sum before ‘normal pension age’.  There was an option for the employer to waive all or part of the actuarial reduction which was detailed in the report.

The introduction of the new LGPS also required scheme employers to review their existing discretionary pension policy arrangements and set out how the new discretions would be applied in relation to specific provisions in the scheme which were listed in the report.  There were no changes to provisions in relation to Early Retirement on the Grounds of Redundancy or Early Retirement in the Interests of Efficiency which were normally initiated by the organisation/employer.  This meant that the pension benefits available for employees under the current Change Programme and the recent Voluntary Redundancy Scheme (2014) would not be impacted by these changes to the regulations.

In the scenarios on discretions outlined in the report, the Council would have the option under the new discretions to consider waiving the actuarial reduction in full or in part following consideration under defined criteria as set out in the revised Early Retirement Policy, on a ‘case by case’ basis.  In all cases, requests would be considered corporately prior to any final decisions being made, ensuring that outcomes were fair, consistent and justifiable and represented a cost effective approach for the Council.

Councillor Billy Mullin, Cabinet Member for Corporate Management recommended approval of the report which was seconded by Councillor Bernie Attridge.

RESOLVED:

(a)       That the changes to the Local Government Pension Scheme (LGPS) regulations for 2014 be noted;

(b)       That the Council’s intended approach to the discretions under the LGPS 2014 and the revised Early Retirement Policy be noted and approved; and

(c)        That the Council’s intention to revise the current Flexible Retirement policy which would be considered by Cabinet in June 2014 be endorsed.