members

Joining, transferring or combining my benefits

What do I need to know about joining, transferring or combining my benefits?

As a new member, or if you are moving between employers within the Scheme, it is important that you know what your options are.

How do I join the LGPS?

This depends on who you work for, what job you do and what arrangements your employer has for putting their employees into the Local Government Pension Scheme (LGPS). 

Some employers have to automatically enrol those entitled to join into the LGPS, like local authorities and academy schools. Others may only be able to enrol certain employees who, for example, do a particular type of job or who can join based on particular terms and conditions in their contract of employment. 

If you are unsure what applies to you then it is best to check with your employer. If you are eligible to join and not currently a member, you can let your employer know you want to join by completing the joining form

To find out how your pension works in the LGPS see our how does my pension build up? up section.

Are there any restrictions on joining?

You cannot join if you are age 75 or older. 

Otherwise there are no restrictions meaning you can join if you are full time, part time, on a permanent, temporary or casual working contract.

How much does it cost?

You have to pay into the Local Government Pension Scheme (LGPS) to build up benefits. Your employer pays in too.

The amount you pay in, known as your pension contribution, is linked to your pay. There are different contribution rates depending on how much you earn.

How do I work out what my contribution rate will be?

You can use this table to do this. Your contribution rate is worked out as a percentage of your pay. The contribution rates from April 2020 are:

BandSalaryMain section contribution % 50/50 section contribution %
1Up to £14,6005.5%2.75%
2£14,601 to £22,800
5.8%2.9%
3£22,801 to £37,1006.5%3.25%
4£37,101 to £46,900
6.8%3.4%
5£46,901 to £65,6008.5%4.25%
6£65,601 to £93,0009.9%4.95%
7£93,001 to £109,50010.5%5.25%
8£109,501 to £164,20011.4%5.7%
9£164,201 or more
12.5%6.25%

Table was last updated 13/05/2020

If you have more than one job, your contribution will be separate for each employment.

How are my contributions paid to GMPF?

Your employer will automatically deduct pension contributions when they pay you. They must pay the contributions to Greater Manchester Pension Fund (GMPF) each month.

Your employer will deduct your pension contributions before they work out the tax you owe. You will see the amounts they have deducted on your payslip. Your employer will review and set your contribution rate in April each year. Your employer may decide to review your contribution rate earlier if your pay changes.

How might I benefit from tax relief?

Your pension contributions are deducted from your pay before your tax is worked out. So, if you earn enough to pay tax, the total amount of tax you pay will be lower than if you didn’t pay pension contributions.

What if I’m part time?

Contributions are based on the actual pay you earn. So, using the table above, if you work full time and your actual pay is £40,000, then your contribution rate in the main section will be 6.8 per cent.  If you go part time and reduce your hours by 50 per cent, then your actual pay will be £20,000, and your contribution rate will be 5.8 per cent.

How much does my employer pay in?

GMPF’s actuary sets the cost to your employer. It is reviewed every three years.

The actuary sets a contribution rate for your employer that they believe will result in GMPF having enough money to pay all the pension benefits that have been built up in the past, plus those that will be paid in the future.

If the money GMPF holds falls below the amount needed, employers have to make up the shortfall by paying more. If GMPF has a surplus of funds, then the actuary may reduce employer contributions.

You can find out more about employer contributions in the annual report and accounts.

What counts as ‘actual pay’?

The elements of your pay that count as actual pay for your pension include: 

  • your normal salary or wages
  • bonuses
  • overtime (both contractual and non-contractual)
  • maternity, paternity, adoption and shared parental pay
  • shift allowance
  • additional hours payments if you work part time
  • any other taxable benefit specified in your contract as being pensionable

You do not pay contributions on:

  • any travelling or subsistence allowances
  • pay in lieu of notice
  • pay in lieu of loss of holidays
  • payment as an inducement not to leave before the payment is made
  • any award of compensation (other than payment representing arrears of pay) made for the purpose of achieving equal pay
  • pay relating to loss of future pensionable payments or benefits
  • pay paid by your employer if you go on reserve forces service leave
  • the monetary value of a car or pay received in lieu of a car
  • any sum which has not had tax liability determined on it

What is the 50/50 section?

You can choose to join the main section or the 50/50 section of the LGPS. The main section is where you will be automatically enrolled when you join. You can choose to switch to the 50/50 section at any time.  

In the 50/50 section, you pay contributions at half the rate of the main section and your pension builds up at half the rate. However, you keep the same life and ill health cover as if you were in the main section.

You build up pension in the main section based on 1/49 of your actual pay. This becomes 1/98 in the 50/50 section.

How do I apply to move into the 50/50 section?

If you want to move sections, you must tell your employer. You can do this using the 50/50 application form.

Once your employer receives your request, they will deduct contributions at the new rate from the next available pay period. You can check the rate you will pay by using the table shown in the ‘How much does it cost?’ section above.

How long can I stay in the 50/50 section?

The 50/50 section is designed to be an option for members who want to reduce their contributions for a short time while still building up a pension.

There is no limit on the amount of time you can stay in the 50/50 section. 

There are occasions when your employer must put you back into the main section:

  • On their automatic re-enrolment date 
  • If you go onto nil pay as a result of sickness or ordinary child related leave. 

After being moved into the main section, you would be able to switch back to the 50/50 section again.

Can I pay towards an additional pension when I’m in the 50/50 section?

If you are in the 50/50 section, you cannot continue to pay additional pension contributions (APCs) or shared cost APCs or take out a new APC contract unless you are buying back lost pension.

You can continue, or start, paying additional voluntary contributions (AVCs) when in the 50/50 section.

Can I transfer in benefits?

You may be able to transfer a pension you have built up in a different pension scheme or Local Government Pension Scheme (LGPS) fund into the pension you are now building up in Greater Manchester Pension Fund (GMPF). 

We will normally accept transfers from:

  • other public sector pension schemes
  • other LGPS pension funds.

We do not accept transfers from private sector schemes or personal pension plans. 

You may also be able to combine separate pensions you have built up in GMPF. 

To transfer or combine benefits, you must be paying into GMPF and must normally ask within 12 months of joining.

How do I make a request to transfer in a previous pension or combine the LGPS pensions I have?

Process for transferring in

Step 1 - further information

Your employer will make us aware that you have joined the pension scheme.

Once received, we will provide you with a welcome pack and a starter form. (Member declaration form)

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Step 2 - further information

You must complete and return the starter form within 12 months if you wish to transfer or combine previous pension benefits.

If you have other service with GMPF please make sure that you also include this on the form. 

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Step 3 - further information

If the previous pension rights you have are from a similar scheme then we will ask the provider for the value of those benefits.

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Step 4 - further information

Once we have received all of the information we require, we will write to you with an offer to transfer in or combine your previous benefits with your ongoing pension GMPF account. 

Please carefully read the letter and complete the form within the deadline confirmed on the letter.

Complete the member transfer request form and provide proof that you have obtained financial advice (if CETV is over £30,000 and transferring to a defined contribution scheme). You will need to send part of the pack to your chosen scheme as they will also need to complete some forms and return these to us.

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Step 5 - further information

If you have elected to transfer or combine your benefits we will request payment from the provider or fund. If you were previously a member of GMPF then we will link both of your employments under your ongoing record.

Please note that in some cases, if you do not respond we will automatically link your benefits.

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We will ask you to complete a new member declaration form when you join GMPF telling us whether you wish to transfer or combine any other pension benefits. This should be done within 12 months of joining. You can also write to us with the same information. Once you have uploaded your completed form using your online My Pension account we will send you an election form to complete.

Transfers from public sector schemes

We will ask you to complete a new member declaration form when you join GMPF telling us whether you wish to transfer or combine any other pension benefits. This must be done within 12 months of joining. We will contact the scheme directly and ask them to send us information about the pension you had with them. We will then write to you, telling you what LGPS benefits you will receive if you decide to transfer in order for you to make a decision.

Transfers from a LGPS fund

If you have been paying into the LGPS before, you can combine your pension benefits. This must be done within 12 months of joining. This is known as an ‘interfund’ transfer. The options available to you will depend on what benefits you have built up in your previous fund and the date you left.

We will ask your previous pension fund for details and will then write to you with your options. You will need to consider whether you want to transfer and let us know if you do not wish to combine them by the response date given in the letter. Otherwise, we will automatically combine them for you. 

You might not be able to transfer if you opted out of the LGPS on or after 10 April 2015. We will write to you if this restriction applies.

Transfers to LGPS in Scotland and Northern Ireland are treated the same as public sector transfers.

Combining previous GMPF pensions

You can combine your new pension with a previous pension you may have built up in GMPF. 

If you left a job with an employer who offered you a pension with GMPF and have now started another job, either with the same or different employer who also offers GMPF, then you can combine the benefits that are on hold with your new pension pot.

We will send information to you about combining your benefits once we have received the request form from you. You will need to consider whether you want to transfer and let us know if you do not wish to combine them by the response date given in the letter. Otherwise, we will automatically combine them for you.

If we don't receive your completed new member declaration form, and we know you have other LGPS benefits (at GMPF or elsewhere) we will combine the accounts.

You might not be able to transfer if you opted out of the LGPS on or after 10 April 2015. We will write to you if this restriction applies.

How do I know whether to go ahead with the transfer?

There can be a lot to think about when deciding whether to transfer previous pension benefits into GMPF, especially from outside of the LGPS. You should think about:

  • What is the normal pension age (NPA) for your previous pension benefits compared to the normal pension age in the LGPS?
  • Taking your benefits before your NPA means they are normally reduced.
  • If your previous benefits are based on your final salary will this still be the case once you have elected to transfer into GMPF, if so is your full time equivalent salary now higher or lower?
  • Once you elect to transfer, all your benefits must be taken at the same time (except for flexible retirement). 
  • If you leave your employment on the grounds of redundancy or efficiency, and are over age 55, your employer must then pay any reductions normally applied to all your benefits for early payment, including any benefits you have transferred in.

If you need advice on deciding whether to transfer then it may be worth speaking with an independent financial adviser.

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