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The Superannuation Arrangements of the University of London |
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What are the proposed changes for active members? This section explains the limited changes proposed to benefits you build up from 1 July 2012 if you're an Active Member before that date. |
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Quick Links |
Leaving SAUL and rejoining later Early retirement after leaving Pensionable Service Pension increases on benefits built up after 1 July 2012
Leaving SAUL and rejoining later If you leave Pensionable Service on or after 1 July 2012 and rejoin SAUL within 30 months, you'll continue to build up benefits in the same way as on the date you leave. If you rejoin SAUL after 30 months, you'll build up benefits on a Career Average Revalued Earnings (CARE) basis. CARE is explained in "What are the proposed changes for new members?" If you leave Pensionable Service before 1 July 2012, your right to rejoin SAUL on a Final Salary basis will last until 31 December 2014. Why is this proposed? ►This safeguards the right of members who might want a career break or leave the higher education sector temporarily to rejoin SAUL within 30 months and build up benefits in the same way as on the date they leave.
Early retirement after leaving Pensionable Service If you leave Pensionable Service on or after 1 July 2012 and keep (or "defer") your benefits in the Scheme until you retire, then benefits you build up from 1 July 2012 will be reduced if you retire before age 65. Currently, deferred pensions are reduced if you retire before age 60 – this will continue for benefits you build up before 1 July 2012. If you remain an active member of SAUL, you will still be able to retire from age 60 without having your pension reduced – unless the Trustee decides otherwise, which it currently does not intend to do. Why is this proposed? ►This lessens the funding pressure on SAUL because the earlier people retire, the more it costs to provide a pension.
Pension increases on benefits built up after 1 July 2012 While a SAUL pension is being paid, it is linked to increases in the Consumer Prices Index (CPI). Benefits built up before 1 July 2012 will continue to increase in line with the CPI once they start being paid as a pension. Benefits built up from 1 July 2012 will receive capped increases – see the table below. The SAUL Trustee will retain the right to provide discretionary increases above these levels.
If a member leaves Pensionable Service and keeps (or "defers") benefits in SAUL, these increase until retirement. Currently, deferred benefits increase by the greater of increases required by law and increases granted at the Trustee's discretion. Under the proposals, benefits built up from 1 July 2012 will increase by the greater of:
The Trustee will retain the right to provide discretionary increases above these levels. Why is this proposed? ►This reduces the risk of high inflation increasing SAUL's Liabilities. |
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