85 year rule protection

If you paid into the LGPS before 1 October 2006, your LGPS pension benefits will be protected by a regulation known as the 85-year rule.

When you meet the 85 year rule, some (or all) of your pension will not be subject to early retirement reductions if you put your pension into payment earlier than normal pension age.

This webpage provides a general explanation of the 85 year rule, however if you want to know how it applies to you, contact us.

For more information about reductions applied when a pension is paid early, see early retirement.

If you have 85 year rule protection, it will only apply when:

• your age and length of LGPS membership adds up to 85 and,
• you are age 60 or older

Membership is calculated at full calendar length for the 85 year rule, so if you are part-time this won’t mean you have less membership than someone who worked full-time. Age is also calculated in whole years.

The date you meet the 85 year rule is known as the Critical Retirement Age (CRA).

It’s important to note that when you take your pension, you must take it in its entirety. You cannot take part of your pension and leave the rest.

If you are currently paying into your pension, see the retirement process for more information about taking your pension.

If you no longer pay into your pension, see taking your deferred benefits.

The 85 year rule does not apply equally to all pension benefits. The level of protection varies depending on:

• the date you started paying in
• your date of birth
• the date you meet the 85 year rule

If you have 85 year rule protection, these things determine what group of member you are and what this means for your pension.

You will be a group 1 member if:

• you were born on or before 31 March 1956
• you became a member of the scheme on or before 30 September 2006

If you are a group 1 member, pension benefits built up before 31 March 2016 will not be reduced when you meet the 85 year rule. Pension benefits built up after this date are payable at your Normal Pension Age. This date will be the same as your state pension age.

You will be a group 2 member if:

• You became a member of the scheme on or before 30 September 2006
• Your date of birth is between 1 April 1956 and 31 March 1960
• You met the conditions for the 85 year rule before 31 March 2020

If you are a group 2 member, when you meet the 85 year rule:

• pension benefits built up before 31 March 2008 will not be reduced
• pension benefits built up between 1 April 2008 and 31 March 2020 will have a tapered (partial) reduction applied instead of full early retirement reductions

Pension benefits built up after 31 March 2020 will not be reduced when you meet your Normal Pension Age. This date will be the same as your state pension age.

You will be a group 3 member if:

• you became a member of the scheme on or before 30 September 2006
• you are not a group 1 or group 2 member

If you are a group 3 member, pension benefits built up before 31 March 2008 will not be reduced when you meet the 85 year rule. Pension benefits built up between 1 April 2008 and 31 March 2014 will not be reduced when you reach age 65. Pension benefits built up after 1 April 2014 will be payable at your Normal Pension Age. This date is usually the same as your state pension age.

For all groups, any membership relating to:

• service purchase which started after 1 October 2006
• Additional Regular Contributions (ARCs) contracts which started between 1 April 2008 and 31 March 2014
• transferred in service between 1 April 2008 and 31 March 2014

Will not be subject to reductions from age 65. Any other type of additional pension purchased such as Additional Pension Contributions (APCs) are payable at your Normal Pension Age.

You can ask your employer to consider switching on the 85 year rule before age 60 (from age 55), if:

• you are currently paying into the LGPS
• you have 85 year rule protection
• your age when added together with the length of LGPS membership adds up to 85 before you reach age 60

If your employer agrees and you want to release your pension before age 60, the reductions applied to your pension may be reduced.

The decision to switch on the 85 year rule early is at the sole discretion of the LGPS employer. Each LGPS employer is required to keep a  discretionary policy about this.

If you have any questions about this, contact your employer.

Early retirement reductions and 85 year rule protection can be difficult to work out.

We recommend you obtain an estimate to see how the 85 year rule impacts on your pension. You can use My Pension Online to get a rough estimate of the pension payable to you.

If you are close to retirement, we recommend you contact us directly for an estimate before you make a decision about taking your pension. We can supply you with up to 2 estimates in any rolling 12-month period.

If you join the LGPS and you have previous LGPS membership, you must tell us about this by completing an LGPS membership form if you haven't done so already. We will then write to you with your options for Combining LGPS accounts.

If you choose to combine earlier deferred LGPS pension benefits that have 85 year rule protection with later LGPS pension benefits, you will continue to have 85 year rule protection.

However, combining them may impact on the day you meet the 85 year rule. If there is a long gap between the two periods of service, it could mean you meet the 85 year rule later than you would have if they were separate.

This doesn’t mean combining pension benefits is the wrong decision, as there are other considerations involved. When we investigate your options for combining LGPS pension accounts we will write to you with all the things you need to consider before making the decision to either combine or leave your LGPS pension benefits separate.

We recommend you obtain independent financial advice where possible before making any decision about your LGPS pension.

For more information, see get help with decisions about your pension.