We are conducting some research to help make our services better. Start our short survey now.

Website Main Menu:

Expand

Cambridge University Assistants' Contributory Pension Scheme (CPS)

A full review of the Cambridge Pension Scheme ('CPS') was carried out in 2009. Since then there have been active discussions and negotiations between the University and the Trade Unions through their established Partnership Working Group and more recently through a Special Joint negotiating Committee (SJNC) of the University and Assistants' Joint Board (UABJ). We have also kept the CPS Trustee informed on the progress of the review.

During the meetings of the SJNC, the University's original proposals were changed to take into account feedback from the Trade Unions. Following these changes, UAJB has agreed that we can enter into a formal consultation period with employees. This consultation period will run from 5 August 2011 to 11 November 2011.

We recognise that pensions is a complex subject so we have tried to explain the proposed changes as simply as possible in the Employee Consultation Pack dated August 2011 which you should have received.

Questions or feedback?

Please direct your queries via our contact details below.

Important Notes - please read and click I AGREE below to continue

  • 1. The benefits shown are approximate and are based on the current proposals, the current State Pension system and the law as it currently stands. Future changes to the law could impact on your benefits
  • 2. The figures are shown in terms of today's prices so that you can assess the potential spending power of your estimated benefits
  • 3. For members who joined CPS before 1 December 2009, it is assumed that you will exchange part of your pension for a cash lump sum
  • 4. For members who join CPS on or after 1 April 2012, the actual level of your DC pension will depend on the investment return achieved and annuity rates at retirement. It may be higher or lower than the amount shown by the modeller
  • 5. The contribution rate shown includes an allowance for the additional National Insurance Contributions you will pay
  • 6. For part-time employees the benefits are based on your current salary and do not allow for changes in your part time hours
  • 7. The calculations do not allow for transferred in benefits or additional voluntary contributions (AVCs)
  • 8. Entitlements under the CPS are governed solely by the Rules of the CPS (as amended from time to time). Should there be any discrepancy between this illustration and the CPS Rules, the Rules will prevail.
  • 9. The member contribution rate for existing members is 6% of salaries made up of: before 1 April 2012 - 6% of salaries, no contributions to S2P(1) (Contracted-out(2)) on and after 1 April 2012 - 6% of salaries including approximately 1% in respect of contributions to S2P(1) (Not contracted-out (3))
  • 10. The member contribution rate for new entrants to CPS from 1 April 2012 is 4% of salaries including approximately 1% in respect of contributions to S2P(1) (Not contracted-out (3))
  • 11. State pension provision is changing. The Government intends to consult on a proposal to replace the Basic State Pension and S2P with a single flat-rate state pension .This change is likely to benefit individuals on low earnings. However, the detail of the proposed changes is not known and there will be an extensive period of consultation before any changes are introduced. Please note that the benefit illustrations in this document are based on the current S2P structure and do not take into account the potential changes outlined above.
  • 12. For the estimated Defined Contribution benefit at retirement, the following assumptions have been made: RPI inflation is assumed to be 3.4% per annum for the period up to retirement; Investment returns are assumed to be 3.2% above RPI inflation reducing to 1% above RPI inflation in the 10 year period before retirement; The factor used to convert the DC pot at retirement into a pension is based on current market annuity rates and allows for pension increases in line with RPI inflation. Therefore, the Defined Contribution benefit at retirement is based on expected market conditions and could vary significantly if experience is different.
  • (1) State Second Pension (S2P) - The State pension scheme introduced with effect from 6 April 2002 to enhance the Basic State Pension. Contributions are paid via National Insurance Contributions from gross salaries. The S2P is payable once an individual reaches their State Pension Age. Individuals are either Contracted-Out(2) or Not contracted-out(3).
  • (2) Contracted-out - contributions which would have been paid towards the S2P are directed to an alternative arrangement (CPS). The alternative arrangement is required to pay a guaranteed minimum level of pension as a replacement for the S2P. Contracted-out employees do not receive an S2P pension in respect of service within CPS.
  • (3) Not contracted-out - contributions are collected by the State via national insurance contributions in return for the S2P pension from the State.
I agree - start the modeller

Important Notes

  • 1. The benefits shown are approximate and are based on the current proposals, the current State Pension system and the law as it currently stands. Future changes to the law could impact on your benefits
  • 2. The figures are shown in terms of today's prices so that you can assess the potential spending power of your estimated benefits
  • 3. For members who joined CPS before 1 December 2009, it is assumed that you will exchange part of your pension for a cash lump sum
  • 4. For members who join CPS on or after 1 April 2012, the actual level of your DC pension will depend on the investment return achieved and annuity rates at retirement. It may be higher or lower than the amount shown by the modeller
  • 5. The contribution rate shown includes an allowance for the additional National Insurance Contributions you will pay
  • 6. For part-time employees the benefits are based on your current salary and do not allow for changes in your part time hours
  • 7. The calculations do not allow for transferred in benefits or additional voluntary contributions (AVCs)
  • 8. Entitlements under the CPS are governed solely by the Rules of the CPS (as amended from time to time). Should there be any discrepancy between this illustration and the CPS Rules, the Rules will prevail.
  • 9. The member contribution rate for existing members is 6% of salaries made up of: before 1 April 2012 - 6% of salaries, no contributions to S2P(1) (Contracted-out(2)) on and after 1 April 2012 - 6% of salaries including approximately 1% in respect of contributions to S2P(1) (Not contracted-out (3))
  • 10. The member contribution rate for new entrants to CPS from 1 April 2012 is 4% of salaries including approximately 1% in respect of contributions to S2P(1) (Not contracted-out (3))
  • 11. State pension provision is changing. The Government intends to consult on a proposal to replace the Basic State Pension and S2P with a single flat-rate state pension .This change is likely to benefit individuals on low earnings. However, the detail of the proposed changes is not known and there will be an extensive period of consultation before any changes are introduced. Please note that the benefit illustrations in this document are based on the current S2P structure and do not take into account the potential changes outlined above.
  • 12. For the estimated Defined Contribution benefit at retirement, the following assumptions have been made: RPI inflation is assumed to be 3.4% per annum for the period up to retirement; Investment returns are assumed to be 3.2% above RPI inflation reducing to 1% above RPI inflation in the 10 year period before retirement; The factor used to convert the DC pot at retirement into a pension is based on current market annuity rates and allows for pension increases in line with RPI inflation. Therefore, the Defined Contribution benefit at retirement is based on expected market conditions and could vary significantly if experience is different.
  • (1) State Second Pension (S2P) - The State pension scheme introduced with effect from 6 April 2002 to enhance the Basic State Pension. Contributions are paid via National Insurance Contributions from gross salaries. The S2P is payable once an individual reaches their State Pension Age. Individuals are either Contracted-Out(2) or Not contracted-out(3).
  • (2) Contracted-out - contributions which would have been paid towards the S2P are directed to an alternative arrangement (CPS). The alternative arrangement is required to pay a guaranteed minimum level of pension as a replacement for the S2P. Contracted-out employees do not receive an S2P pension in respect of service within CPS.
  • (3) Not contracted-out - contributions are collected by the State via national insurance contributions in return for the S2P pension from the State.
Expand

Useful Links

Find a selection of useful links below:

Expand

Contact Details

If you have any comments, views or queries, please address them to the Consultation mailbox at:

cpspensionsreview@xafinity.com

A list of the 'Frequently asked questions' will be provided at the Pensions section of the University of Cambridge website at:

http://www.admin.cam.ac.uk/offices/pensions

Expand

Member Presentations

If possible, you should attend a member presentation where you will receive more information about the proposal and have the opportunity to ask questions. Details of the times and venues of the sessions can be found on www.CPSpensionreview.net

In order to register for a presentation please email cpspresentation@xafinity.com, confirming your name and the presentation you would like to attend. Capacity at each location will be limited, so if your preferred session is already full you may be advised to select an alternative.

Please note that you will be required to bring your ID and sign in at the session.

Help

  • 1. The benefits shown are approximate and are based on the current proposals, the current State Pension system and the law as it currently stands. Future changes to the law could impact on your benefits
  • 2. The figures are shown in terms of today's prices so that you can assess the potential spending power of your estimated benefits
For the purposes of this model, you must be aged between 16 and 75 at 1 April 2012 (the proposed change date).
Please select an option using the buttons on the right.
Please enter your current full-time or part-time salary (part time salaries should not be increased to the full-time equivalent)
If you choose 'Yes' you will be required to enter your date of joining CPS (please see Parts 1A and 1B of the Employee Consultation Pack). For the purposes of the model, if you choose 'No' you will have the option to choose whether you intend to join before 1 April 2012 (assumed to be tomorrow's date) or from 1 April 2012 (please see Parts 1B and 2 of the Employee Consultation Pack resepectively).
Please select an option using the buttons on the right.
Please enter the date you joined CPS.
Your target retirement age must be between 60 and 75 and not before your current age. For the purposes of the model you must select an integer age of retirement. E.g. if you are currently aged 62 and 6 months you must choose a retirement age between 63 and 75.
Please choose your level of expected salary increases. For the purposes of the model, salary increases are referenced to changes in the Retail Price Index ('RPI').
Please add a percentage.

Possible changes to State pension benefits

The Government has consulted on possible changes to the State Pension system. The consultation involved two possible options:

  • 1. Accelerating the move to a flat rate S2P
  • 2. Combining the Basic State Pension and S2P to form a single tier State Pension

The consultation period ended on 24 June 2011 and the Government has now published a summary of the responses received, which shows that around three quarters of organisations who responded support a single tier State Pension. However, the responses also commented that much more detail on the proposals is required and that there would be a long and complex transition to a new State Pension system.

The Government will now decide whether it wishes to take its proposals further. If the Government does decide to reform the State pension system then full consultation will be required, including a detailed impact analysis for future pensioners. In addition, the reforms will need to go through the usual parliamentary process.

It is therefore unlikely that any changes will take place before 2020.

You can keep up with developments at www.dwp.gov.uk/state-pension-21st-century

Xafinity SIPP Services Ltd is authorised and regulated by the Financial Services Authority

Footer Information: