The Barnardo Staff Pension Scheme (the ‘Scheme’) is a Defined Benefit (DB) pension scheme. The Scheme closed to new members in 2007, and it closed for further contributions in 2013, which means that existing members stopped paying contributions and building up any new pension.
This article explains:
- How the Scheme works
- How the Scheme is run
- Your options at retirement
For personalised information about your benefits in the Scheme, please log in to PRISM: secure.barnardostaffpensionscheme.co.uk
How the Scheme works
As a member of the Scheme, you are entitled to a pension for life when you retire.
Your pension at retirement is calculated based on your years of pensionable service with Barnardo’s (until the date the Scheme closed or the date you stopped paying in to the Scheme, if earlier), the rate at which you build up pension In the Scheme, and your historic salary.
The rate at which you build up your pension, the definition of salary, and the other definitions used in the calculation are set out in the Scheme’s rules. There are different definitions depending on when you were an active member of the Scheme.
- The amount you will receive at retirement is fixed (based on the calculation above), apart from increases that help towards offsetting the impact of inflation.
- The increases to your pension are subject to a maximum percentage, which is set out in the Scheme’s rules. Different parts of your pension might increase by different amounts, depending on when the pension was earned.
Members who haven’t taken their pension
When you stopped paying in to the Scheme, you became a ‘deferred member’. This means you have built up the promise of a secure pension for life in the Scheme. Although you aren’t adding any more years of service to your Scheme pension, your promised pension amount increases each year in line with the rules of the Scheme. This is to help towards offsetting the impact of inflation between the date you stopped paying into the Scheme and the date you start taking your pension.
Pensioners
The Trustee Board works closely with the administrator, Hymans Robertson LLP, to ensure that members’ pensions are paid on time. Pensions in payment are also increased each year in line with the rules of the Scheme.
How the Scheme is run
The Scheme is run by a board of trustees, with support from professional advisers and Hymans Robertson LLP, the Scheme administrators.
The Trustee Board
The Trustee Board is made up of employer-nominated trustees, member-nominated trustees and an independent chair. More information about the trustees is available in the Annual Report, which is available on request.
The trustees are legally responsible for managing the Scheme, and they make the key decisions about how it operates, in the best interests of the membership.
While the Scheme was open, you paid in an agreed amount each month to the Scheme and Barnardo’s paid in more to fund members’ benefits. These payments make up the Scheme’s ‘assets’, and they are invested by the trustees based on advice provided by the trustees’ professional advisers. The trustees of the Scheme are focused on making sure the Scheme is able to pay all future benefits (pensions and other payments) from its assets.
Scheme administrators
Along with the Trustee Board, the Scheme administrators are the other ‘face’ of the Scheme, as this is who you will speak to if you have any questions about your membership. The administrators for the Scheme are Hymans Robertson LLP.
They are appointed by the Trustee Board, and arrange payment of pensions, respond to queries from members and keep records up to date. The Trustee Board monitors the administrator to ensure that members are receiving the best possible service, and that all activity is carried out in a timely manner.
Your options at retirement
Within the Scheme, you may have some flexibility for when and how you take your pension:
- You could take your pension early, typically at any time from age 55 (rising to 57 from April 2028). If you take your pension early, your starting pension will be lower than if you had waited until your Normal Retirement Age (you can find this by logging in to PRISM), but you would start receiving your pension sooner and we expect it to be paid for longer.
- You can take your pension from Normal Retirement Age, or even later. You may want to take your pension at your Normal Retirement Age in the Scheme or even consider delaying this. If you take your pension late, your starting pension will receive a late retirement increase (as agreed by the Trustee Board and calculated by the Scheme Actuary), as it is expected to be paid for a shorter duration.
- When you start your pension, in broad terms, you can normally exchange up to 25% of your starting pension for a tax-free cash lump sum and receive a lower starting pension.
Members who haven’t yet retired also have the option to transfer the value of their benefits out of the Scheme to an alternative arrangement. This might be, for example, a Defined Contribution (DC) scheme that provides access to options and income flexibility not available within the scheme.
The Trustee Board strongly recommend that you take advice from a regulated financial adviser before choosing to transfer your pension to a DC arrangement – you would lose the security that a DB scheme offers as, in a DC pension scheme, the amount that you receive at retirement is not guaranteed. In addition, unregulated pension scammers have targeted members of Schemes like ours and caused members to lose all their pension.
If your pension is worth more than £30,000, it is a legal requirement that you take financial advice before transferring out of a DB scheme. If you do not have a financial adviser, you can find a regulated financial adviser at moneyhelper.org.uk/en/pensions-and-retirement/taking-your-pension/find-a-retirement-adviser or alternatively unbiased.co.uk can put you in contact with a selection of advisers in your area. You can visit their website at www.unbiased.co.uk. Please note that there will be a charge for any financial advice that you take, so please check the costs before proceeding.
If you would like to know more about your options from the Scheme, please contact the Scheme administrator using the details on the ‘Help and Further Information’ page.
Members of the Defined Contribution Plan – the Barnardo’s Retirement Savings Plan
When the DB Scheme closed in 2013, all active members were offered membership of the Barnardo’s Retirement Savings Plan (the ‘Plan’), a group personal pension arrangement with Aviva. The Plan is a DC pension plan— the amount that members receive at retirement is dependent on a number of different factors, including investment returns. If you are a member of the Plan, you can find details of your membership at workplace.aviva.co.uk/barnardos/