Glossary

Accrual rate 

The proportion of pensionable pay that each year of membership adds to your pension – effectively the speed at which your pension builds up. 

Actuarial enhancement /
Late payment enhancement

The amount a pension is increased if it is taken after an individual’s normal pension age. 

Actuarial reduction /

Early payment reduction 

The amount a pension is reduced if it is taken before an individual’s Normal Pension Age

Added pension 

As now, alpha members will be able to purchase added pension in blocks of £250, payable at the appropriate pension age. 
Alpha The Principal Civil Service Pension Scheme in operation for new entrants from April 2015 and those members of other PCSPS schemes not covered by transitional protection
CARECareer Average of Revalued Earnings. An alternative type of defined benefit pension scheme to a final salary scheme.
ClassicThe Principal Civil Service Pension Scheme in operation for new entrants between 1972 and September 2002.
CPIConsumer Prices Index.  This is the current measure of inflation that the government has decided to use to increase benefits from all PCSPS pensions.  It is also the index used to revalue nuvos and alpha.
Deferred pensionPension built up by members who leave before retirement.
Defined benefitAn occupational pension scheme that determines how much pension you will get by reference to a set formula, rather than the performance of investments and cost of annuities.
Final salaryA type of defined benefit pension scheme in which your pension is largely determined by your salary at retirement.
Full transitional protectionTransitional protection available to those who were members of classic or premium and aged at least 50 on 1st April 2012 and members of nuvos who were aged at least 55 on that date.
Gross contribution rateThe percentage of pensionable pay which is deducted before any account is taken of tax relief on pension contributions.
Net contribution rateThe percentage of pensionable pay which is deducted after account is taken of tax relief on pension contributions. The amount of tax relief will depend on the individual members’ circumstances.
Normal Pension AgeThe age at which the scheme will pay your benefits without actuarial reduction or enhancement as of right.
NuvosThe current Principal Civil Service Pension Scheme in operation for new entrants since July 2007.
PCSPSThe Principal Civil Service Pension Scheme, a term used to describe all civil service pension schemes.
Pensionable pay The pay used to calculate employee contributions and benefits.
Pensionable serviceThe period of membership used to calculate benefits.
PremiumThe Principal Civil Service Pension Scheme in operation for new entrants between October 2002 and June 2007 (and some former members of classic who opted to move schemes in 2002).
Revaluation rateThe index by which pension built up each year is increased.
RPIRetail Prices Index.  This is the measure that was used prior to April 2011 for increases to pensions in payment and deferment.  This has been replaced by CPI.
Split retirementThe facility for members with different pension ages in different PCSPS schemes to take those benefits at different times
State Pension AgeThe age at which, based on your date of birth, your state pension becomes payable.
Tapered protectionTransitional protection available to those who were members of classic or premium and aged between 46 years and 7 months and 50 on 1st April 2012 and members of Nuvos who were aged between 51 years 7 months and 55 on that date.
Tax reliefPension contributions are deducted from your earnings before tax. This is known as pension tax relief.
Trading pensionThe ability for members to swap £1 of annual pension for £12 of cash lump sum up to a maximum allowed by HMRC.

 

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