Redundancy

Redundancy and business efficiency retirements

Members of the LGPS aged 55 or over with at least two years scheme membership who are made redundant (either voluntary or compulsory) or retired in the interests of business efficiency, will be entitled to immediate payment of their Local Government Pension.

Redundancy process for scheme employers

In the vast majority of redundancy or efficiency retirements a cost will apply to the employer to finance the early payment of that pension, known as capital, or strain costs.

In order to establish the amount that is likely to be payable, employers must complete the REDCOST1 form below:

Note that the standard turnaround for the provision of the information is 4 weeks.

Alternatively, speak to Pensions about the possibility of receiving estimated costs in bulk, particularly where multiple cases are likely. Whilst this may result in a slightly less accurate figure, it is likely to be sufficient to establish whether redundancy will be an affordable option for particular members.

Employers may then wish for their scheme members to receive an estimate of their likely pension benefits to allow them to decide whether to accept early retirement, in the event that employers would want to give them such an option. Such requests must come through employers, not directly through members, and must be requested by submitting the REDQUOTE1 form below:

Again, the standard turnaround time for these requests are 4 weeks.

However, employers are reminded that scheme members can be directed to the Member Self-Service online portal to use the modeller for an indicative quote of their pension benefits.