Note: The FBU opposed the introduction of this scheme as we believed that one scheme should cover all, however following our objections the Government decided to impose this scheme as from April 2006.

Note: With the recent introduction of this scheme details are limited. As more information becomes available, updates will be placed on the online resource centre - www.fbuonline.org.uk

The Scheme provides a full range of benefits including the following –

· an inflation-proofed pension based on your final pay and length of service

· an option to convert part of the pension to a lump sum

· early payment of benefits if you have to retire on grounds of permanent ill-health

· death-in-service cover of a lump sum equal to three times pensionable pay

· a pension for your widow(er), civil partner, or nominated partner

· children's pensions

BACKGROUND

The first national pension scheme specially designed for firefighters was introduced in 1926. As with all occupational pension schemes, the rules of the Firefighters' Pension Scheme are reviewed and amended from time to time to reflect changes in the nature of the service, and society as a whole. This sets out the rules of the New Firefighters' Pension Scheme 2006 which came into effect on 6 April 2006. The previous Scheme – the Firefighters' Pension Scheme 1992 – continues in force for firefighters who were serving before that date. In this guide, the New Firefighters' Pension Scheme 2006 will be described as "the New Firefighters' Pension Scheme" or "NFPS" to distinguish it from the earlier Scheme.

The NFPS is a statutory, public service pension scheme made under section 34 of the Fire and Rescue Services Act 2004. Unlike occupational pension schemes in the private sector, it does not have trustees. Also, it does not have the usual type of pension fund found in the private sector which uses investments to help meet its liabilities. Although each Fire and Rescue Authority is required to maintain a pension fund which:

· receives employee and employer contributions and transfer values from other schemes, and

· pays out benefits and transfer values to other schemes

the authority does not have the power to invest the money as would normally be the case with a pension fund. If the fund has insufficient money to meet all of its pension liabilities, the Secretary of State will make up the shortfall; if the fund is in surplus, the Secretary of State will take the excess to cover any shortfall in the funds of other authorities.

Social Security rules can have an impact on the way pension schemes work. The NFPS is "contracted out" of the State Second Pension arrangements, i.e. the additional element of pension paid on top of the Basic State Retirement Pension. To be given contracted out status a pension scheme has to meet certain minimum requirements. Members of a contracted out scheme pay a lower, contracted out rate of National Insurance contributions.

Her Majesty's Revenue and Customs give certain tax concessions to "registered" pension schemes. The NFPS is such a scheme. This means that contributions paid and benefits accrued, provided they are within certain limits, are exempt from tax charges.

Like all other pension schemes, the NFPS must comply with Pension Acts although, as a public service scheme, it is exempt from some requirements. Regulations made under Pension Acts require you to be given certain items of basic information about the Scheme; this booklet has been written to comply with those Regulations.

Some pension terms may be unfamiliar to you or have a special meaning in the context of the NFPS.

If you have access to the internet, the website of the Office of the Deputy Prime Minister has special pages dedicated to the Firefighters' Pension Schemes providing background information and details of any amendments that may be made. You can access these pages at www.odpm.gov.uk/firepensions.

WHO CAN JOIN?

Membership of the New Firefighters' Pension Scheme is open to any employee of a Fire and Rescue Authority whose role on joining the Fire and Rescue Service includes attendance at fires or other emergencies covered by sections 8 and 9 of the Fire and Rescue Services Act 2004. It does not matter what duty system they are contracted to work – they can be whole-time or part-time regular firefighters, volunteers, or retained duty system firefighters. Other employees of the authority are members of the Local Government Pension Scheme.

If you are eligible to join, you would be admitted automatically upon taking up your employment.

Once admitted to the NFPS, if you are required to perform duties appropriate to your role but not firefighting or those covered by sections 8 and 9 of the Fire and Rescue Services Act 2004 (e.g. if you become unfit for "operational" work), provided there is no break in the continuity of your employment you would be allowed to remain a member.

OPTING OUT

If you do not want to be a member of the NFPS you can opt out at any time by giving written notice to your Fire and Rescue Authority. The notice would take effect from the start of the following pay period.

If you have less than 3 months' qualifying service at the time the notice takes effect, you would normally receive a refund of the contributions you had paid.

If you have 3 months' or more qualifying service you would have a choice of –

· a transfer of accrued pension rights to another pension arrangement or

· a deferred pension.

You would cease to have any further cover under the NFPS (other than that provided by any deferred pension). You would, however, continue to be covered by the provisions of the Compensation Scheme.

If you subsequently change your mind and wish to rejoin, you can do so provided that –

· you have less than 40 years in the NFPS at that time

· you have not opted out on more than one occasion, and

· if your Fire and Rescue Authority so require, you undergo a medical examination at your own expense to satisfy them of your good health.

Your election to rejoin would take effect from the start of the following pay period.

Seek independent financial advice if you are thinking about opting-out of the NFPS. You would save the cost of contributions but would probably pay more by way of tax (contributions normally attract tax relief) and National Insurance contributions (while a member of the NFPS you pay the lower contracted out rate). And you and your dependants would cease to have the cover the NFPS provides.

WHAT ABOUT PREVIOUS PENSION RIGHTS?

On taking up your employment you will be asked to give details about any previous membership of a pension scheme and to indicate whether you would like your Fire and Rescue Authority to explore the possibility of a transfer of pension rights to the NFPS. The NFPS can accept a transfer from –

· another occupational pension scheme,

· a personal or stakeholder pension scheme,

· a retirement annuity contract

but will not accept a transfer of pension credit rights, i.e. rights based on a portion of the pension of a former spouse or civil partner as required under a pension sharing order on divorce or dissolution of a civil partnership. Nor will a transfer be accepted if it does not meet certain "contracting out" requirements, or if the service credit provided by the transfer plus your prospective service to age 60 would exceed 40 years.

An application for a transfer must be made, in writing, within 12 months of joining the Scheme and received before the normal pension age of the scheme from which the pension rights are to be transferred. Your Fire and Rescue Authority would provide you with an estimate of the benefits such a transfer would "purchase" in the NFPS. You should compare this with any pension options offered by your previous scheme and decide, within the time limits, whether you wish the transfer to proceed.

If you have pension rights in some other arrangement but have lost contact with the administrators, the Department for Work and Pensions offer a Pension Tracing Service. All pension schemes (including the NFPS) have to be registered with them and the Tracing Service can help pension holders and/or their dependants trace "lost" pension rights. They can be contacted at –

Pension Tracing Service, Whitley Road, Newcastle upon Tyne, NE98 1BA
Tel: 0845 6002 537 Website: www.thepensionservice.gov.uk

HOW MUCH DO I PAY?
As a member of the NFPS you will pay a contribution of 8.5% of pensionable pay. Your Fire and Rescue Authority will pay a contribution of about 13.5% including additional charges for certain awards such as ill-health and approved early retirement benefits. Employees' and employers' contributions are determined by the Secretary of State on the advice of the Government Actuary who will have regard to the total cost of Scheme benefits. They will be reviewed regularly. Valuation of the NFPS is expected to take place every 4 years.

The pensionable pay upon which contributions are assessed is the core pay and all permanent emoluments determined by the firefighter's role or, in the case of a principal officer, the salary appropriate to the overall responsibilities of the post. It will also include any retaining allowance paid to a member on a retained duty contract.

If you are part-time, contributions will be deducted on your part-time pay.

If sick pay ceases, no contributions are payable (the period of unpaid sick leave does not count for pension purposes).

For further info, see links below

In Scotland the New Firefighters Scheme is known as:

Firefighters’ Pension Scheme (Scotland) Order 2007