Following the Budget 2016 announcement, the Government Actuary’s Department has undertaken a review of the retirement lump sum commutation factors used in the 1987 police pension scheme. As a result, the factors have been revised upwards. This will mean an uplift in the amount of cash lump sum that can be taken. The updated scheme commutation guidance is attached.
The purpose of Circular 2016/06 is to:
- Advise on the introduction of revised factors prepared by the Government Actuary’s Department for the purpose of calculating lump sums payable to retiring members under regulation B7 of the Police Pensions Regulations 1987. These factors should be applied to retiring members with effect from 18 March 2016.
- This updates the previous guidance dated 22 May 2014 which were outlined in Circular 5/2015.
This provides some good news for those in the 87 scheme with a heavy health warning my calculations is that by example a colleague aged 51 years 0 months on the second top Superintendent scale (71070) would get a maximum lump sum (subject to tax on the element above 20.0) rising from 21.80 to 22.4 times the pension commuted which could equate to cash sum net of tax of £253279 as opposed to £249241 under previous arrangements.
Please get accurate figures from SPPA as required but this will represent a modest increase.
For the SPPA Circular 2016/06 please click HERE
ASPS General Secretary