Member benefits
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The Plumbing & Mechanical Services (UK) Industry Pension Scheme is a career average scheme, which provides benefits on retirement and also on death.
While you were a contributing member, you built up pension credits based on your salary for each year of membership. These benefits will receive bonuses each year until you retire to help protect them against inflation.
In most cases, you would have earned a pension credit equal to 1.25% (1/80th) of your salary in each year that you were paying into the Scheme. At retirement, a pension equal to the total value of your credits plus bonuses is payable.
You may be able to transfer your benefits in the Scheme to another pension arrangement, for example, into a new employer’s pension plan or a personal pension.
If you’re considering transferring your benefits out of the Scheme, you should contact the administration team to request a transfer quotation. This quotation will show the value of your benefits in the Scheme available to you if you wish to transfer to a different pension arrangement.
The size of the transfer value will depend on your total pension credit in the Scheme, your age at the date of transfer, and investment market conditions at the time of calculation.
- You may request one free transfer value quotation every 12 months.
- If you want more than one quotation in a 12-month period, there will be a charge. Please contact the administration team for further information.
- Transfer quotations are guaranteed for three months from the date of issue.
- Transfers are not permitted after your 66th birthday. Please do not leave it too late to request a quotation because the transfer process can take 3-6 months to complete. Requests will not be accepted if they are submitted within three months of your 66th birthday.
If you’re thinking of transferring your benefits out of the Scheme, we recommend you take independent financial advice. If you transfer, you may have more flexibility in how you access your retirement savings but you could be worse off because you will lose the income for life and death benefits that the Scheme offers. The Scheme cannot advise you on what to do.
The law says that you must take independent advice before transferring your benefits to another scheme if your transfer value is over £30,000.
If you decide to transfer your pension to another arrangement, the administration team must complete certain checks to identify whether you’re at risk of being a victim of a pension scam. If these checks raise any warning flags, your transfer may be delayed while you are referred to MoneyHelper for scam-specific guidance, or even stopped completely.
If you’re approaching retirement age, there are many websites with useful information to help you plan ahead.
The Pensions & Lifetime Savings Association has created a website here to help people understand the sort of retirement lifestyle they could achieve with different levels of income. A single person wanting to cover all their basic needs, with a bit of money for fun activities, would need an income of around £14,400 a year.
For many people, their State Pension will account for a large chunk of their retirement income (it’s currently £11,500 a year for someone with the required 35 years of National Insurance credits). However, the age at which you can claim your State Pension is rising, so there may be a gap between when your Scheme pension kicks in and when you can get a State Pension. You can find out more on the Government’s State Pension web page here.
The administration team will contact you shortly before your Normal Retirement Date (your 65th birthday) to explain your retirement options. You can choose to retire before or after your Normal Retirement Date, which can affect how much pension you receive.
The annual amount of your pension at age 65 is the total of all the pension credits you built up over the years you paid into the Scheme, plus any bonuses awarded. You’ll receive a Pension Certificate every year to show how much pension you’re likely to receive at your Normal Retirement Date, to help you plan ahead. When you retire, you can choose to exchange some of your pension for a cash lump sum.
Some people may be able to afford to retire early, while others may be forced to retire as a result of ill-health.
You may choose to retire any time after the Normal Minimum Pension Age (currently age 55 but increasing to age 57 from April 2028). If you retire early, your benefits will be calculated as if you were retiring on your Normal Retirement Date but they will be reduced to reflect the early payment. When you retire, you can choose to exchange some of your pension for a cash lump sum.
If you are forced to retire before your Normal Retirement Date because of Incapacity, then an immediate pension may be payable at the discretion of the Trustee even if you are below the Normal Minimum Pension Age (currently age 55 but increasing to age 57 from April 2028). This pension will be calculated as if you were retiring on your Normal Retirement Date, although it may be reduced because it is being paid early. When you retire, you can choose to exchange some of your pension for a cash lump sum.
The Trustee will ask for evidence of your continued incapacity at regular intervals until you reach Normal Retirement Date. If you retire with an Incapacity pension and your health improves, your pension may be reduced or suspended.
If you choose to retire after your Normal Retirement Date, your pension credits earned up to Normal Retirement Date will be actuarially increased to reflect the later retirement date. Any pension credits earned after your Normal Retirement Date will not be increased for late payment. When you retire, you can choose to exchange some of your pension for a cash lump sum.
When you retire, you can choose to ‘give up’ some of your pension in return for a tax-free cash lump sum. The remainder of your pension will be paid to you as a regular income for the rest of your life. The amount of pension you receive will be lower than if you hadn’t taken a cash lump sum.
If you have a small Scheme pension worth less then £10,000, you can choose to exchange all of your pension for a single cash lump sum. If your Scheme pension is worth more than £10,000 but the total value of all your retirement savings is less than £30,000, you can choose to exchange your Scheme benefits for a single cash lump sum. You will have to pay tax on some of the money you receive. The administration team will set out your options in your retirement illustration.
If you paid Additional Voluntary Contributions (AVCs) to supplement your retirement savings, these are invested with Legal & General. When you retire, you can choose to use your AVCs to take a tax-free cash lump sum or supplement your retirement income.