Early access to FAS payments
Qualifying members can access their FAS payments early in the following circumstances:
Payments can also be made to eligible survivors of qualifying members who have accessed their FAS payments early in this way.
Terminal illness
FAS payments can be made to a qualifying scheme member of any age where they have a progressive disease and their death in consequence of that disease can reasonably be expected within six months. In these circumstances the FAS payment is not reduced.
Please contact us if you would like further information about how to apply for this type of payment.
Severe ill-health and ill-health
There are other kinds of FAS payments related to poor health. These are:
- Severe ill-health payments, and
- ill-health payments.
Being eligible for severe ill-health and ill-health payments
There are some specific rules that have to be met to receive these payments. However, to receive either payment from FAS you must be:
- an eligible member of a qualifying pension scheme;
- unable to work due to ill health and
- likely to be unable to work because of your ill health until your normal retirement age.
Main points on severe ill-health payments
People who have a much lower life expectancy because of their ill health may receive severe ill-health payments from the FAS. These payments from FAS are meant to put members in the same position as if they had already reached their normal retirement age.
The FAS can make severe ill-health payments, without actuarial reduction, to members of qualifying pension schemes who, in addition to the requirements under Being eligible for severe ill-health and ill-health payments, are:
- aged 55 years or over;
- unable to work and likely to be unable to work until their normal retirement age;
- have a progressive disease; and
- have a much lower life expectancy because of that disease.
For severe ill-health payments, we need evidence that you are unable to work or have been advised not to work, that the disease you are suffering from is progressive (will get worse over time) and will have an impact on your life expectancy. We will also require medical information about your condition. This includes details of the treatment you are receiving and how long you have had the condition. If you are unsure whether you have a progressive disease, please speak to your GP or consultant.
For FAS purposes, a ‘much lower life expectancy’ means having a condition that could reasonably be expected to result in death within five years.
This does not mean that a doctor has told you that you have five years or less to live. It means that five years or less would be within the range that a doctor could reasonably predict for a person in your situation.
The FAS does not consider other things such as lifestyle in making these decisions. We look only at the specific condition and its likely effect on a member's life expectancy. With your permission we may need to contact your GP or consultant for more evidence.
Unlike ill-health payments, severe ill-health payments will not be actuarially reduced. FAS severe ill-health payments will be paid at 90 per cent of a member’s accrued pension’ (the pension built up in the scheme); less any scheme pension the member receives. There is annual limit of £26,000, known as ‘the cap’.
If the conditions are met for severe ill-health payments, they will be from the latest of the following:
- The date from which the FAS scheme manager is satisfied that the conditions were first met.
- The date the member reaches the age of 55.
- 14 May 2004 (when FAS was announced). The earliest anyone can apply to have severe ill-health payments paid from is 14 May 2004.
Important things to be aware of
As a member of a FAS qualifying scheme, your accrued pension is continually revalued until you reach your normal retirement age. For severe ill-health payments we will apply revaluation only up to the time your period of entitlement starts rather than to your normal retirement age. This means you may get less than if you had waited until your normal retirement age, even though there is no actuarial reduction for the earlier payment.
Severe ill-health payments for a past period
If you apply for severe ill-health payments, you may be able to have them start from an earlier date if you can show you would have met the conditions earlier. You may then receive a lump sum relating to that earlier period. But your monthly payment may be less as we will only revalue your accrued pension until the earlier date from which the severe ill-health payments begin.
It may be that you have already reached your normal retirement age or are getting ill-health payments from the FAS, but you think you could have qualified for severe ill-health payments from an earlier date if they had been available. If so, you may be able to switch to severe ill-health payments based on the earlier date.
The surviving partner or, if there is no surviving partner, the personal representative of a member who has died can also apply for payments reflecting an earlier period, if they believe the member would have qualified for severe ill-health payments.
Main points on ill-health payments
For ill-health payments you will need, in addition to the requirements under Being eligible for ill-health payments, to show that:
- you have been advised, by your GP or a medical professional, not to work because of ill health.
- you are within five years of your normal retirement age (subject to a minimum age of 55)
The FAS takes your normal retirement age to be the age stated in your scheme rules, at which you would usually retire, or:
- 60, if your normal retirement age is below 60 years, or
- 65, if your normal retirement age is after age 65.
FAS payments are normally paid at 90 per cent of the ‘accrued pension’ (the pension the member built up in their scheme), less any scheme pension the member receives, up to an annual limit of £26,000, known as ‘the cap’.
Ill-health payments from the FAS will be ‘actuarially reduced’. This means the amount received will be reduced to take account of the longer period of time the payment could be made for (because the payment begins up to five years before your normal retirement age).
The actuarial reduction, set by the Government Actuary’s Department, makes assumptions about matters such as normal life expectancy and interest rates. This reduction means you get broadly the same amount overall as if you had waited until your normal retirement age but the monthly payments are lower because they are spread over more years.
Important things to be aware of
As a member of a FAS qualifying scheme, your accrued pension is revalued until you reach your normal retirement age.
But if you take your FAS payments early due to ill health, we will apply revaluation only up to the time you start taking payments rather than to your normal retirement age. This means you may get less than if you had waited.
Remember that ill-health payments are actuarially reduced to take into account that you will be receiving payments for longer. The example below shows how much you may lose if you choose to take ill-health payments. The closer you are to your normal retirement age, the smaller this difference will be. The example explains the likely position if you take your pension at the earliest possible date.
Example for ill-health paymentsYou choose to receive FAS payments five years before your normal retirement age. During this time, inflation is 3 per cent a year. If you had waited till normal retirement age, you could have got up to 25–35 per cent more each year. This is because your FAS payment would have been revalued up to your retirement date and there would have been no actuarial reduction. |
If you choose to receive FAS payments early because of ill health, this will affect the amount of assistance your husband, wife or civil partner will get when you die. Their payments would be based on half the reduced amount of your FAS payment.
Please consider the effect of the actuarial reduction and the loss of revaluation if you are thinking of taking ill-health payments now instead of waiting until your normal retirement age.
If the conditions are met for ill-health payments, entitlement will be from the later of the following:
- the date from which the FAS scheme manager is satisfied that the conditions were first met;
- five years before normal retirement age.
Please note: Receiving payments from FAS could affect any state benefits that you may already receive, such as Employment and Support Allowance, Pension Credit, Council Tax Benefit and Housing Benefit among others.
If you are receiving FAS payments, you should tell the office that pays your state benefits.
Summary of the main conditions for both kinds of payment
| Conditions for payment | Ill health | Severe ill health |
|---|---|---|
| You must be a member of a FAS qualifying pension scheme |  |
|
| You must be unable to work due to ill health and be likely to remain so until your normal retirement age | |
|
| You must be within five years of your normal retirement age. | |
|
| You must be aged 55 or over | |
|
| You must have a much lower life expectancy | |
|
| You must have a progressive disease | |
|
| Details of payments | Ill health | Severe ill health |
| They can only begin from five years before your normal retirement age | |
|
| They are reduced to reflect early payment | |
|
| They can begin from age 55 | |
|
| They are actuarially reduced | |
|
| The accrued pension is revalued up to the date payments begin | |
|
How to apply for severe ill-health or ill-health payments
Asking for a form
Please contact us for an ill-health application form and ill-health leaflet. You must tell us on the form about:
- what type of payment you are applying for, and
- your ill health and how it is likely to affect your ability to work until your normal retirement age.
Giving us evidence
You will need to send us supporting evidence. This could be, for example:
- a GP’s medical certificate
- evidence that you are entitled to relevant benefits such as Incapacity Benefit, Employment and Support Allowance, Disability Living Allowance, or other benefits relating to ill health
- a letter from a doctor, consultant or other registered medical professional which recommends that you should not work
- a letter from a doctor, consultant or other registered medical professional which states that you have a progressive disease which will have an impact on your life expectancy, as well as details of any treatment and when the disease was first diagnosed
- a letter from your occupational therapist
- a letter from your former employer which explains that you stopped work due to ill health
- copies of details of your hospital appointments or of other medical treatment, and
- anything else you feel may support your application.
If you have to pay to get the evidence, we cannot refund the cost.
Please ensure the evidence supports what you say on your form. In particular, it should include:
- specific details and dates of your ill health and when it started
- details of how your ill health prevents you working or means you should not work
- confirmation that your ill health is likely to affect you until you reach normal retirement age,
- confirmation, where appropriate, that your condition is progressive. Also give details of when the illness was first diagnosed and any treatment you have had.
If possible, please send your supporting evidence at the same time as your application form. However, if you need to send us supporting evidence separately, please make sure you include:
- your name
- your address
- your National Insurance number, and
- the name of your pension scheme.
We may not be able to decide whether you are entitled to payment until you have provided supporting evidence.
Other people contacting us on your behalf
Anyone can ask us for a form or give relevant evidence on your behalf. If they contact us, they will need to give us:
- your name
- your address
- your National Insurance number, and
- the name of your pension scheme.
After we receive your form and evidence
When we have received your application form and supporting evidence, we will need detailed information from your scheme about your pension, so we can work out how much you may be entitled to. We will ask your scheme for this information as soon as we receive your form. With your permission, we may contact your GP or consultant for more evidence.
Survivors
For the FAS, a survivor is the surviving wife, husband or civil partner of a member or former member of a qualifying pension scheme who died after the scheme started to wind-up.
At what age is a survivor entitled to FAS payments?
Payments to survivors can begin regardless of the age of the survivor.
The survivor of a qualifying member becomes eligible for payments from whichever is the later of:
- 14 May 2004; or
- the day after the day on which the qualifying member died.
Payments are backdated to the date the survivor became eligible.
Survivors will receive a payment from the FAS only if the member would have been eligible.
What about surviving wives, husbands and civil partners of members who died before wind-up commenced?
Survivors of pension scheme members who died before the start of scheme wind-up will be ‘qualifying members’ for FAS purposes in their own right, subject to their meeting the eligibility criteria. This is because they would have been entitled to pension payments themselves from the scheme before it started to wind-up.
How are survivor’s payments calculated?
FAS is able to calculate annual payments when a pension scheme has discharged its liabilities to a member, which is usually on completion of wind-up. For survivors, annual payments are determined using different methods which will generally depend on whether qualifying members died during wind-up or after wind-up has been completed.
Initial payments are paid at the discretion of the FAS Scheme Manager where we are waiting for the scheme’s liabilities to be discharged and so cannot calculate annual payments.
What about surviving spouses or civil partners of pension scheme members who qualified for FAS ill-health payments?
Widow/ers and surviving civil partners are eligible for FAS assistance.
Survivors of members who had qualified for interim ill-health or initial severe ill-health payments or final ill health or severe ill-health payments will receive assistance payments based on the member’s early payment rate. Such payments are based on half of the member’s FAS entitlement in the same way as the general FAS survivor provisions.
What should I do to get a payment as a survivor ?
If your spouse or civil partner was already receiving FAS then we should have your details and payments to you should begin immediately. If your spouse or civil partner had been receiving FAS but you are not, then you should contact us.
If your spouse or civil partner wasn’t getting FAS when they died and neither are you, then you should either contact us or your scheme trustees to see whether they have contacted us to let us have your details or those of your late spouse or civil partner.
If you need further information about FAS please contact us.