ARMED FORCES PENSION SCHEME 1975 (AFPS 75) 

FREQUENTLY ASKED QUESTIONS

GENERAL

Why are provisions for officers and other ranks different?

Historically, officers and other ranks have been treated differently, with separate terms and conditions of service.

What is a PVR rate?

This only relates to officers. Officers who choose to leave after reaching the Immediate Pension Point (IPP) but before completing the end of their commission are paid premature voluntary retirement rates of pension, which are lower than the immediate pension rates. After 29 years’ service these rates equate to immediate pension rates.

Are there any changes to AFPS 75?

Yes. The preserved pension age is changing from age 60 to age 65 for all service after 6 Apr 06. The death-in-service lump sum has also increased to three times representative pay with effect from 6 Apr 05.

Why do officers get a full career pension after 34 years and other ranks after 37 years?

Officers’ pension benefits build up at a faster rate than other ranks. A full career pension at age 55 is worth 48.5% of representative pay for both officers and other ranks, although other ranks would have to serve longer to reach this.

What pension do I get at the Immediate Pension Point (IPP)?

Officers get a pension worth 28.5% of representative pay after 16 years’ reckonable service, while other ranks get a pension worth 32% of representative pay after 22 years’ reckonable service.

If AFPS 05 does not have attributable benefits do I need to remain in AFPS 75?

No. It does not matter which pension scheme you belong to. You will be covered either by the Armed Forces Compensation Scheme (AFCS) if your injury or illness is caused by service on or after 6 Apr 05, or by the War Pensions Scheme (WPS) and by the attributable arrangements in AFPS 75 for injuries and illnesses caused by service before 6 Apr 05.

What will happen to my reserved rights to life commutation under AFPS 75 after A-Day?

You retain full reserve rights to life commutation. The new A-Day rules (tax changes) do not apply to life commutation.

RECKONABLE SERVICE

What is reckonable service?

All paid service from age 18 for other ranks and age 21 for officers (including cadetships) is reckonable towards pension.

Why has this changed in the new scheme?

AFPS 05 is a new pension scheme with new arrangements. Benefits are balanced across the whole scheme and the Armed Forces population. The cost of including the pre-age 18 (ORs) and pre-age 21 (officers) service are therefore contained within AFPS 05. This is not so in AFPS 75.

What is the difference between reckonable service and qualifying service?

Why is my previous reckonable service as an other rank that was pensionable, not pensionable if I am commissioned from the ranks?

When you are commissioned from the ranks you sign onto a new contract with different terms and conditions of service. Officers earn pension benefits from age 21, compared with age 18 for other ranks.

Does this mean I lose out in pension benefits?

No, as pension benefits build up at different rates (accrual) and officers can earn a full career pension after 34 years in comparison with other ranks who earn a full career pension after 37 years.

DEPENDANTS’ BENEFITS

What is the purpose of the short term pension?

It is to provide families with continuity of income over a difficult period following a member’s death.

Why is this not available in the new scheme?

It is no longer allowed under Inland Revenue rules.

What if I am already married to somebody who is 12 years younger than me when I transfer to AFPS 05?

Normally, the pension would be reduced. However, if a member transfers from AFPS 75 who is already married or in a civil partnership transfers from AFPS 75, then this rule does not apply and the pension is not reduced.

Why are partners not eligible for non-attributable pensions in AFPS 75?

It has been the long-standing policy of successive governments that discretionary changes to improve the benefits from public service pension schemes should be implemented from a current date for future service only. The AFPS 05 covers partners where the death is not attributable to service and if you transfer from AFPS 75 your service will count towards your partner’s benefits in the event of your death.

How do I know whether my partner would be eligible for attributable benefits?

There is a DCI JS 3/04 which lays out the eligibility criteria for partners. There is a link to this document on the ‘Find Out About Armed Forces Pension Scheme 1975’ page.

I have a same-sex partner and intend to register a partner under the Civil Partnership Act (CPA) 2004 once the scheme is introduced.  How might this affect my partner’s pension benefits if I die?    

Under the CPA 2004, pension schemes will be required to provide benefits to a civil partner based only on a member’s service from 6 April 1988. Civil partnership gives other non-pension benefits compared with an eligible partner, including tax, married quarters, etc.

What if I die before 6 April 2006? Which scheme will my dependants receive benefits from?

There is a special arrangement in place to cover death in service from 6 April 2005 (when AFPS 05 was introduced for new entrants) to 5 April 2006 (the day before the common Member Transfer Date for current serving members of AFPS 75). During this period, AFPAA will initially award death benefits under AFPS 75. A comparison table of benefits will then be provided to your dependants, along with the Family Pension Booklet for both schemes. Your dependant will then choose which scheme they would like to receive benefits from. From 6 April 2006, members will have decided which scheme they wish to belong to.

Can you give me a forecast of my pension less my pension sharing order?

Not accurately. When the order was made, its value in £’s and pence was calculated and annotated on your file. That value was credited to your ex-spouse’s account to be held until she is age 60 (because that was the preserved pension age for AFPS 75 at the time of your divorce). When your preserved pension is due to be paid, the annotated amount is increased in line with pension increases (which rise more slowly than pay). This increase amount will then be subtracted from your pension, which will be calculated using your final pensionable pay. Although AFPAA at Glasgow will be able to tell you the value of the amount to be deducted at today’s value, but they will not be able to project for the future, as they do not know what rate of increases will apply.

ADDITIONAL VOLUNTARY CONTRIBUTIONS AND ADDED YEARS

I am contributing to an AVC (other than to increase death-in-service) under AFPS 75 (or buying added years of service). If I transfer to AFPS 05, what happens to the contributions I have made?

The scheme actuary will calculate the value of your past contributions in terms of additional reckonable service and add the figure to your reckonable service to be transferred. However, you cannot transfer more than 35 years’ service into AFPS 05.

I am buying a death-in-service (DIS) lump sum of four times representative pay in AFPS 75. What should I do from 6 April 2005?

Between 6 April 2005 and 5 April 2006 you will not pay premiums, as a four times DIS lump sum is available under transitional arrangements, whereby AFPAA will calculate dependants’ benefits on both AFPS 75 and AFPS 05 arrangements and give the better outcome to the family. See DIB 2005/19.

How do I ensure my DIS AVC premiums are suspended?

The change will take a few months to implement, but AFPAA expects to complete action, including a refund of premiums paid from April 2005, by the end of September 2005. Individuals should not therefore contact AFPAA, unless their payments continue after September 2005.

If I decide to stay in AFPS 75, what are my choices for DIS AVC from 6 April 2006?

The DIS lump sum in AFPS 75 increases to about three times pay for deaths on or after 6 April 2005. If you decide to stay in AFPS 75 and want to continue to buy a four times DIS lump sum benefit, you will need to apply to AFPAA to start a new contract. You will pay one-third of your original payment, as you will be buying one-third of the extra benefit you originally contracted to buy. You should advise AFPAA of your decision by 1 March 2006. Exceptionally, you will also be allowed to stop the contract if you decide you do not want to continue to pay for a DIS AVC.

RE-EMPLOYMENT

I intend to leave at the Immediate Pension (IP) Point in AFPS 75. If, later, I were to rejoin the Regulars or join FTRS, what would happen to my IP and lump sum? 

Your IP may be reduced on re-employment to ensure that your new salary plus your pension do not together exceed your salary at departure. This is the usual abatement rule in public service pension schemes. Your IP lump sum is not affected. However, the EDP is not a pension. If you are re-employed, your EDP income would stop for the duration of your engagement and restart at the same level when you left service, if before age 55. If you were age 55 or more and you were in Regular service or the MPGS, you would receive your pension instead, which otherwise would be preserved to age 65. If you were in the FTRS, the EDP income resumes at 75% of preserved pension, together with inflation increases since your original departure from regular service.

MPGS

Will I be entitled to a pension immediately if I leave MPGS at age 55, even if I have not served a Full Career Pension? (new question 18/08/05)

Yes. Your pension on leaving will be based on the number of years’ service, even if not a full career.

Am I entitled to a pension paid immediately if I leave the MPGS at age 55?

Yes.  If you left regular service with an Immediate Pension (IP) before being re-employed as MPGS, your pension will restart on leaving at age 55 (it will have been reduced during the time of your MPGS service to ensure that MPGS pay plus pension did not exceed your pay rate when you left service the first time).  A separate pension will be awarded for your MPGS period of service.

What if I left regular service before reaching IP and joined MPGS?

If you did so with a gap of less than one month, this would count as continuous service. If you then complete 22 years' service, you would be entitled to a pension paid immediately. If you did not complete 22 years' service, you would be entitled to a preserved pension payable at age 60 (for service up to 5 April 2006, age 65 for service from 6 April 2006).

If the gap between the two periods of service was more than one month, you would have a preserved pension for the first period of service (payable at age 60 and 65 as appropriate) and your MPGS service would be under AFPS 05. You may also choose to add the two periods of service together, but you need to be careful not to worsen your benefits under AFPS 05. The first preserved pension (under AFPS 75) is paid at age 60 and the second would be paid at age 65.

REDUNDANCY

What are the redundancy terms?

The existing terms will continue for AFPS 75 members for the duration of the current drawdown which is due to complete by 31 March 2008. These terms will then be replaced by less generous terms, which are expected to be broadly comparable with the new AFPS 05 terms up to the mid-career break point, but, generally, significantly more valuable thereafter, though the gap will narrow as the normal retirement age is approached. Those made redundant before 31 March 2008 but after they have elected to transfer will have the opportunity to revert to membership of AFPS 75 to take advantage of the existing provisions.

If I am selected for redundancy under the current round of redundancies, but have opted to transfer to the AFPS 05, must I return to AFPS 75 to take advantage of the higher redundancy benefits?

Yes. You will need to return to AFPS 75 to take advantage of the higher redundancy benefits, but you will then not be eligible for AFPS 05 benefits. However, redundancy compensation is only one element of the range of benefits offered under the two pension schemes and therefore should not be viewed in isolation, but as part of a total package.

Why are the redundancy compensation provisions not the same for both the AFPS 75 and the AFPS 05?

The redundancy provisions are different as they are designed to support two very different pension schemes. The 2005 terms also reflect changes across the public sector on redundancy policies. The main reason for the difference is due to the lower value of EDP when compared with the IP payable under the AFPS 75.

What happens if I am made redundant from April 2008?

New arrangements will be put in place for members of both schemes. AFPS 75 benefits are generally expected to remain more valuable than those relating to AFPS 05 members, particularly for those made redundant between the IP/EDP points and the mid-40s.

Last Updated: 9 Sep 05