If You Retire on Ill Health Grounds at Any Age

When you retire, you can look forward to receiving a pension that increases every year in line with the cost of livingfor the rest of your life.

There is scope to retire and draw your benefits from age 55, right up to age 65 and beyond. In cases of ill health, there is no age limit at all.

There are various options in retirement dependant on your age. One important condition to draw your benefits before age 65 is that you must have at least 3 months membership or have brought in a transfer from another pension scheme. This applies to all the types of retirement outlined below.

Ill health:

If you have to leave work due to illness, you may be able to receive immediate payment of your benefits. Ill health benefits can be paid at any age and are not reduced on account of early payment – in fact your benefits could be increased to make up for your early retirement. To qualify for ill health benefits, your employer, based on an opinion from an independent doctor, must be satisfied that you will be permanently unable to do your own job and that you have a reduced likelihood of bring capable of obtaining gainful employment before age 65.

There are graded levels of benefit based on how likely you are to be capable of obtaining gainful employment after you leave. These are explained on Hampshire Pension Fund’s website:

You will not be able to gain immediate access your benefits regardless of the reason for leaving (other than an ill health retirement). As long as you have been a member for at least three months, you have two options:

• You can choose to keep your benefits in Hampshire Pension Fund. They will be kept as a ‘deferred benefit’, will be reviewed every year in line with inflation and will become payable at your normal retirement age.
• You may be able to transfer your deferred benefits to a new pension arrangement.
• If you later become ill, you may ask your former employer if you can have early payment of your deferred benefits on ill health or compassionate grounds. You have to be at least 55 to ask for this option.

If you are moving to another job, you can keep your benefits within Hampshire Pension Fund as a deferred benefit or transfer them to a new pension arrangement.

Alternatively, you can draw your benefits between the ages 55 and 59 if your employer agrees in one of the following ways.

Early with employer’s consent:

• You are entitled to immediate payment of your benefits built up to date
• Your benefits may be reduced to take account of their early payment if the 85-year rule is not satisfied.
• Your employer may have to pay an additional cost (strain charge) to Hampshire Pension Fund.

Redundancy:

• You are entitled to immediate payment of benefits built up to date
• There is no reduction for early payment
• You are entitled to a statutory redundancy payment of up to 30 week’s actual pay. This is paid by your employer and is independent from your pension, however you may be able to use a small portion of your redundancy payment to purchase extra annual pension.
• Your employer will have to pay an additional cost (strain charge) to Hampshire Pension Fund
• Your employer may grant you augmented (increased) membership or buy you additional pension.
• Each employer has a published policy disclosing whether or not they augment membership or buy additional pension. You should ask your Human Resources Department for details of your employer's policy.

Efficiency:

• You are entitled to immediate payment of benefits built up to date
• There is no reduction for early payment
• Your employer may grant you augmented (increased) membership or buy you additional pension.
• Each employer has a published policy disclosing whether or not they augment membership or buy additional pension. You should ask your Human Resources Department for details of your employer's policy.
• Your employer will pay an additional cost (strain charge) to Hampshire Pension Fund.

Flexible Retirement:

• You can reduce your hours or move to a less senior position and draw the pension benefits you have built up – helping you ease into retirement. This is called ‘flexible retirement’
• Your benefits may be reduced to take account of their early payment if the 85-year rule is not satisfied
• You can continue paying into Hampshire Pension Fund on your reduced hours or in your new role, building up further benefits
• Flexible retirement is granted at the discretion of your employer. Each employer has a published policy on the conditions under which they will grant a flexible retirement. You should ask your Human Resources Department for details of your employer's policy.
• Your employer may have to payan additional cost (strain charge) to Hampshire Pension Fund.

There are various options for receiving your pension benefits when you reach the age of 60.Alternatively, if you are moving to another job, you can keep your benefits within Hampshire Pension Fund as a deferred benefit or transfer them to a new pension arrangement.

Voluntary Early Retirement:

• You can retire and receive your benefits without needing your employer’s consent
• Your benefits may be reduced by a percentage depending on how many years before the age of 65 you are retiring,if 85-year rule is not satisfied
• There is no additional cost to your employer.

Redundancy:

• You are entitled to immediate payment of benefits built up to date
• You will not suffer a reduction for early payment
• You are entitled to a statutory redundancy payment of up to 30 week’s actual pay. This is paid by your employer and is independent from your pension, however you may be able to use a small portion of your redundancy payment to purchase extra annual pension.
• Your employer may pay an additional cost (strain charge) to Hampshire Pension Fund.
• Your employer may grant you augmented (increased) membership or buy you additional pension.
• Each employer has a published policy disclosing whether or not they augment membership or buy additional pension. You should ask your Human Resources Department for details of your employer's policy.

Efficiency:

• You are entitled to immediate payment of benefits built up to date
• You will not suffer a reduction for early payment
• Your employer may pay an additional cost (strain charge) to Hampshire Pension Fund.
• Your employer may grant you augmented (increased) membership or buy you additional pension.
• Each employer has a published policy disclosing whether or not they augment membership or buy additional pension. You should ask your Human Resources Department for details of your employer's policy.

Flexible Retirement:

• You can reduce your hours or move to a less senior position and draw some or all the pension benefits you have built up – helping you ease into retirement. This is called ‘flexible retirement’
• If you take flexible retirement before age 65, your benefits may be reduced to take account of their early payment unless your employer agrees to waive the reduction in whole or in part
• You can continue paying into Hampshire Pension Fund on your reduced hours or in your new role, building up further benefits

• Flexible retirement is at the discretion of your employer and they must set out their policy on this in a published statement. Your Human Resources department will be able to provide you will a copy of the policy. You will need your employer’s consent.
• Your employer will pay an additional cost (strain charge) to Hampshire Pension Fund if they waive any reduction in your benefits.

The normal retirement age is 65 and your benefits will usually become payable from your 65th birthday.

• You can choose to carry on working after age 65 in which caseyou will continue to pay in to the LGPS, building up further benefits
• If you retire at or after age 65 you can defer drawing your pension but you must draw it by age 75. If you draw your pension after age 65 your benefits will be paid at an increased rate
• You must draw your pension on or before the day before your 75th birthday.

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