From 1 April 2014, there are two sections to the LGPS - MAIN and 50/50
The MAIN section of the scheme is the section you will be placed in automatically from when you join the LGPS, where you pay normal contributions and receive the normal build up of pension. This is calculated using 1/49th of your annual pensionable pay (CARE pay).
The 50/50 section is a new option (since 01/04/2014) which you can opt to join. If you do so, you will then pay half contributions but build up half the normal pension. This is calculated using 1/98th of your annual pensionable pay (CARE pay) instead of the 1/49th in the MAIN scheme.
If you have more than one employment you can elect for the 50/50 option in one, some or all your employments. However, regardless of the section you are in, you get full life assurance cover and you are fully protected under ill-health retirement regulations.
How much does it cost?
The rate of contribution you pay will be based on your actual pensionable pay, and there are nine different contribution rates ranging from 5.5% to 12.5% in the MAIN scheme and 2.75% to 6.25% in the 50/50 scheme. Your employer will assess the rate of your contributions for each employment based on your actual pensionable pay in each single employment.
If you earn enough to pay tax then you will be subject to tax relief, meaning if you are a standard rate tax payer, every £1 you contribute into your pension only costs you 80p after this tax relief, and if you are a higher rate tax payer you get tax relief at that higher rate.
Contribution rates 2020/2021
These are based on the pay bands for 2020/2021, please find below the updated contributions table which will take effect from 1st April 2020.
|Contributions table 2021/2022|
|Band||Actual Pensionable Pay
for an employment
|Contributions rate for
MAIN scheme Benefits
|Contributions rate for
50/50 scheme benefits
|1||Up to £14,600||5.50%||2.75%|
|2||£14,601 to £22,900||5.80%||2.90%|
|3||£22,901 to £37,200||6.50%||3.25%|
|4||£37,201 to £47,100||6.80%||3.40%|
|5||£47,101 to £65,900||8.50%||4.25%|
|6||£65,901 to £93,400||9.90%||4.95%|
|7||£93,401 to £110,000||10.50%||5.25%|
|8||£110,001 to £165,000||11.40%||5.70%|
|9||£165,001 or more||12.50%||6.25%|
What’s the difference between the contributions I pay and my pension?
Your contributions and your pension in the LGPS are different. Often people think that their contributions are their pension – but your contribution is "a contribution" towards the cost of the pension scheme similar to that of your employers contributions, where both guarantee you a pensionable benefit.
LGPS website contribution calculator
By clicking the below LGPS logo, you will be able to calculate what contributions you will pay on a monthly basis by simply inputting your annual pensionable pay, pay frequency and whether you are in the MAIN or 50/50 scheme.
As well as your contribution, your employer also contributes to the fund, and is responsible for ensuring there is enough money at the time you retire to pay your pension.
Every three years, an independent actuary calculates how much your employer should contribute to the scheme. Your pension is worked out using a defined formula which is used to work out what your pension will be when you retire.
These contributions are paid to the Clwyd Pension Fund, and cover the cost of the scheme (which includes paying out pensions and death grants).