The New State Pension and National Insurance changes from 6 April 2016

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Members who read last year’s Beeline newsletter, or keep up to date with developments on this website, will already be aware, that the Government is introducing the new single-tier State Pension on 6 April 2016 for those who reach State Pension Age (SPA) after 5 April 2016.

Merseyside Pension Fund will shortly write to the home addresses of all active members of the Local Government Pension Scheme (LGPS), who will reach SPA after 5 April 2016, describing how the new single-tier State Pension will replace the existing basic and additional State Pension from 6 April 2016.

You can view a copy of the Fund’s letter to members here.

From 6 April 2016, the LGPS will no longer be 'contracted-out' of the additional State Pension, and the rebate on National Insurance (NI) contributions which LGPS members previously enjoyed will cease. Consequently, LGPS members will pay a higher amount of NI than in previous years (unless they are one of the few members still paying the married woman's or widow's reduced rate of NI).

The Fund will enclose a 'Questions and Answers' document with the letter, to help members understand what the changes to the State Pension will mean for them. This document includes an illustration of the monthly increase in NI for members earning £15,000, £27,000 and £45,000 per year respectively.

You can view a copy of the ‘Questions and Answers’ here.