FEATURES
Changes to state pension provision affecting spouses and civil partners
Mary Petley.
If you are the spouse or partner of aServiceman or woman you may have heard plenty about the Armed Forces Pension Scheme changes and the benefits that your other half is earning but what about you? Youfollow the flag, often putting your career on hold, and now the government has increased the number of years that you have to pay National Insurance Contributions (NICs) in order to qualify for the full Single Tier pension.
In this article Mary Petley of the Forces Pension Society highlights changes to state pension provision which affect spouses and civil partners who accompany their ‘other half’ontours abroad to the detriment of their own state pension.
First alittle bit about the general changes to the state pension scheme. Prior to 6April 2016 the state pension was made up of two elements –the basic old age pension and the Second State Pension (S2P). Many pension schemes, including public sector schemes, were ‘contracted out’ of S2P, so paid 1.4% of pay less in NICs. That meant they paid less and they got just the basic old age pension. Occupational pensions more than made up the difference! From 6April 2016 S2P and the ‘contracting out’ arrangements disappeared and everyone who pays Class 3NICs now pays them at the same higher rate.
Prior to 6April 2016 you needed 30 years’ contributions to qualify for the full basic state pension. From that date the criteria changed to 35 years’
raf-ff.org.uk
contributions. However,you are paying more but you’ll get more. The ‘old’ basic state pension rate for 30 years NICs is £122.30 and the ‘new’Single Tier pension rate is £159.65. Put simply, you will need to pay NICs for 35 years in total with at least 7.5 years’ worth of contributions at the higher rate to qualify for the full Single Tier pension.
So change, change, change –don’t you just hate change! Now for some good news. As from 6April 2016, spouses and civil partners of personnel who accompanied their ‘other half’ on military service abroad, thereby missing out on paying NICs can claim back credits as far back as 1975 for any missing years. In order to qualify to do this, you need to be born on or after 6April 1953 if you are awoman or on or after 6April 1951 if you are aman. There was achange in 2010, allowing spouses or civil partners who accompanied aserviceman or woman on an overseas posting to claim NIC credits but the change was not retrospective and left the majority with either gaps in their NIC record or abill to fill the gaps.
So, what are you waiting for –here is the claim form:
gov.uk/government/ uploads/system/uploads/attachment_ data/file/373954/modca.pdf.
Youwill need to provide evidence of the periods when you followed the flag and, just to show you that it works, here is feedback from acouple of our members:
“Following your advice about the new rules regarding State Pension Credits Iapplied to Glasgow for a full read out of Theatres I’d served during my time in the forces –The process was very simple –wedid it online –and less than 10 days later we received aletter confirming a number of Pension Credits for the
years spent overseas –enough to ensure that when my wife is able to claim her Pension she will get the full amount under the current system. Many thanks for your help and for publishing the details of the change in the Newsletter.I don’t know how else we would have known about it.”
“I have recently done this on behalf of my wife in respect of our time in The Netherlands in the early 1990s, and she has been awarded 2full years› additional NI credits, which are worth over £1,400 in respect of the purchase of Class 3NICs to increase her future state pension. Manna from heaven.”
Some of you may have purchased NICs for the years that you ‘followed the flag’, and will be put out about this change but do not
fear.You can apply for the Class 3credits and claim arefund of the contribution you made for the purchased years. If you have receipts, so much the better!
Contactingthe FPS
If you areaMember of the Forces Pension Society and have questions on any pension-related issue, contact us at
pensionenquiries@forpen.co.uk
If you are not aMember but would like to know more about us, visit
forcespensionsociety.org
Winter 2017 Envoy 21
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