ancient Civil Service pension - what's it worth?
Discussion
Out of the blue, I've had a letter from a Civil Service quango I worked for back in the 1970s, asking me to sign a pensions declaration of entitlement form. Naturally I've done that, using speedwriting, and pinged it back to them.
About the only thing I do remember about the Civil Service was that the pensions were index linked. I was an Executive Officer back then, which as I recall was a step above the normal file-grunt level. The period of employment was five years from '74 to '79. Eeeh, it takes me back.
Now I'm waiting to hear from them. Does anyone have any idea of what such a pension might be worth? Will I be able to set fire to the house and buy a tropical island, or will it be more at the 'shall we have a Chinese tonight' level?
About the only thing I do remember about the Civil Service was that the pensions were index linked. I was an Executive Officer back then, which as I recall was a step above the normal file-grunt level. The period of employment was five years from '74 to '79. Eeeh, it takes me back.
Now I'm waiting to hear from them. Does anyone have any idea of what such a pension might be worth? Will I be able to set fire to the house and buy a tropical island, or will it be more at the 'shall we have a Chinese tonight' level?
Work it out like this:
You get one eightieth of your pensionable salary for each year of service, so it sounds like you have 5 80ths, or 1 16th.
This increases by RPI (I think).
So, try to remember what your salary was when you finished working for them, then
Divide that number by 16, then
Find one of those online RPI calculators and work out what it's worth now.
You also get a lump sum which I believe is 1.5 times your annual pension.
You get one eightieth of your pensionable salary for each year of service, so it sounds like you have 5 80ths, or 1 16th.
This increases by RPI (I think).
So, try to remember what your salary was when you finished working for them, then
Divide that number by 16, then
Find one of those online RPI calculators and work out what it's worth now.
You also get a lump sum which I believe is 1.5 times your annual pension.
Blackpuddin said:
Will I be able to set fire to the house and buy a tropical island, or will it be more at the 'shall we have a Chinese tonight' level?
At it's raw value it will be more the latter (a decent Chinese, though, I think) but I've got a private sector pension from 5yrs in the early 80's and that has some kind of preserved minimum value which makes it a lot more valuable than its raw value. Maybe the same applies to the CS scheme.NPI said:
Blackpuddin said:
Will I be able to set fire to the house and buy a tropical island, or will it be more at the 'shall we have a Chinese tonight' level?
At it's raw value it will be more the latter (a decent Chinese, though, I think) but I've got a private sector pension from 5yrs in the early 80's and that has some kind of preserved minimum value which makes it a lot more valuable than its raw value. Maybe the same applies to the CS scheme.The value you work out is from 60, you can take it from 50 though and it will be reduced by a certain amount, there's loads of calculators and such on the civil service website if you look under pensions.
Alternatively ask where your most recent benefit statement is and that will tell you exactly
Oh .... The lump sum is 3x whatever the pension ends up being
Edited by anonymous-user on Tuesday 4th March 18:42
Blackpuddin said:
Right.... well, I didn't understand much of that! Thanks to all though. Think I'd best just wait to hear back from them.
Do you know what your EO salary was when you left in the late 70's. Let's say £1000 for ease/exampleDivide that number by 80. = 12.5
Multiply it by your years service (include part years as days divided by 365 eg 183/365= 0.5014) so 5 if you joined and left on the same date 5 years later. = 62.5
That will tell you what your pension at 60 was worth when you left.
To get its current value you need to increase by inflation, RPI from when you left up to 2011 I think and CPI after that. It might be somewhere in the region of 400%. = £250 pension per annum and a £750 lump sum when your 60.
Edited by anonymous-user on Tuesday 4th March 22:54
OneDs said:
No it's exactly as stated before...
I have absolutely no idea how it works, or what else it's dependent on, but there definitely is a Guaranteed Minimum Pension (GMP) provision in older Civil Service pension schemes. Maybe GMP assumes you have no other pension.I reckon the basic value of the OPs pension will something like £100/mth. If GMP applies in some way then it would be more.
Apologies, what I meant is that would be hard to see how it wouldn't exceed the GMP, it would have only been contracted out for 1 year of GMP provision and as an EO he would probably be around the average salary at the time £8-9k, given the 1/80th accrual rate and index linking.
I think it will be closer to £200pmth
Edit: Actually given all these factors it would be interesting to know what the outcome is either way.
I think it will be closer to £200pmth
Edit: Actually given all these factors it would be interesting to know what the outcome is either way.
Edited by anonymous-user on Wednesday 5th March 11:42
I honestly can't remember what my salary was 35 years ago, I have a job to remember what I was doing 35 minutes ago 
but I'm liking the way this thread is developing. It seems to be getting better the longer it goes on. A bit like a decent pension, I suppose.
I am very grateful for the more recent (and much easier to understand) explanations. Money is not my strong point but even I understood that. Thanks.
but I'm liking the way this thread is developing. It seems to be getting better the longer it goes on. A bit like a decent pension, I suppose. I am very grateful for the more recent (and much easier to understand) explanations. Money is not my strong point but even I understood that. Thanks.
OneDs said:
Apologies, what I meant is that would be hard to see how it wouldn't exceed the GMP, it would have only been contracted out for 1 year of GMP provision and as an EO he would probably be around the average salary at the time £8-9k, given the 1/80th accrual rate and index linking.
I think it will be closer to £200pmth
Like I said, I don't know how it works, but I wondered if it *might* help the OP. I think it ties in with the State pension somehow??I think it will be closer to £200pmth
I was trying to relate his pension to today's EO salary of around £25K and erring on the side of caution so he didn't get too excited!
If it's straightforward he'll be lucky - my missus took redundancy from the civil service a couple of years ago and exchanged her redundancy pay for early pension but they changed (reducing of course) the amount 3 times during the process.
ETA: I see what you mean about only a year of GMP - it only kicked in in 1978. I knew it stopped at some point but didn't realise there was start date too.
Edited by NPI on Wednesday 5th March 11:52
Blackpuddin said:
It gets better and better, I am now in real danger of being disappointed when it turns out to be £3 and a sweet wrapper.
I will let you all know what the answer is when I find out.
It might be worth more than a sweet wrapper, when I left the army in 84 with 14 years pensionable service they quoted that the pension at 60 would be about £1,850 per annum.I will let you all know what the answer is when I find out.
When I turned 60 two years ago that had increased to be £5,000 per annum and a 9K lump sum.
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