Statement on Equalisation for GMPs AND the application of a ...

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C.1 Data requirementsFor members of schemes who have already transferred to the PPF the main constraint oncalculating the exact increases to PPF compensation is a lack of detailed member data. Forsuch members, the only data that is held by the PPF in a readily accessible form is thatwhich is required to pay PPF compensation. This consists of basic member informationsuch as dates of scheme membership and amounts of PPF compensation. When a schemetransfers to the PPF a dump of scheme data is also received.However, for schemes that have already transferred to the PPF this data has beenprovided in many different formats and consequently is not readily accessible. We havereviewed the more detailed data transferred for some sample cases and this indicates thatmany of the data items that are required to carry out the exact calculation of the uplift incompensation, for example pension at date of leaving the scheme is not available formany members. Even where this data is available this is not held in such a way that it canbe retrieved in a cost effective manner.The PPF’s approach on how it will tackle this exercise for transferred schemes hastherefore been based on the data that it does have available from three sources:1. Information from PPFstandard data interfacelayout (the DIL)This is the data that is provided on the PPF standard datainterface layout for all schemes that transfer to the PPF. Itincludes individual member information including criticaldates (where these are available) and details of members’PPF compensation. It does not include details of members’GMP.2. GMP data from NISPI NISPI offer a range of services for providing GMP informationto contracted-out schemes. The PPF is considering obtainingGMP information for members that have already transferredto the PPF directly from NISPI.3. Scheme informationquestionnaireFor schemes that are currently transferring to the PPF thePPF is collecting general information regarding thecalculation of benefits directly from the scheme trustees /administrators. This information is being collected using thequestionnaire in D.2. Such questionnaires are intended tosupply sufficient information to enable the PPF to reworkmembers’ benefits at the Relevant Time.Trustees should make reasonable attempts to collect suchinformation. When this information is not availableappropriate assumptions will need to be made.Similar colouring has been used in the rest of this document to indicate the source ofvarious data items.Although this approach uses relatively minimal data, it is accepted that this data may stillnot be available in all cases. In particular, the general scheme information in 3 requiresfor example, details of the early retirement factors in use at the date of retirement for anyaffected pensioner. When information is not available, appropriate assumptions will needto be made.31
C.2 Impact on calculationsThe PPF has reviewed the theoretical calculations that are required to calculate the upliftin PPF compensation for different categories of member under a number of differentscenarios. By then making certain assumptions the PPF has been able to simplify thecalculations required.Based on:- the limited data that the PPF had available;- the relatively small changes to PPF compensation that this exercise produces forthe majority of members; and- the feedback from Stakeholders regarding the complexities of undertaking thecalculations;the PPF is satisfied that this is a pragmatic and proportionate approach to meeting itslegal obligations.Where the assumptions that the PPF has made are borne out in practice, the PPF’sstandard forms produce an exact calculation of the changes required to PPFcompensation.The adjustment to pension / PPF compensation is calculated for all members at theRelevant Time. Where the member has changed status since that time, for example takenearly retirement then the change in pension / PPF compensation needs to be followedthough into any subsequent calculations.32
Page 5 and 6: If you have any questions regarding
Page 8 and 9: A.4 Section 143 valuation requireme
Page 10 and 11: Combining information from several
Page 12 and 13: A.6 Schemes not included in the pil
Page 14 and 15: B.1 BackgroundB.1.1 Content of Part
Page 16 and 17: B.3 Statutory requirements for cont
Page 18 and 19: B.5 Interaction of the statutory re
Page 20 and 21: greater, no further adjustment is r
Page 22 and 23: For actives, the application of the
Page 24 and 25: B.7.4 Typically male deferred pensi
Page 26 and 27: B.8.3 Back-paymentsWhere pensioner
Page 28 and 29: B.10 Back-paymentsB.10.1 Back payme
Page 30 and 31: (c) New Pensioners between the RT a
Page 34 and 35: C.3 AssumptionsThis section contain
Page 36 and 37: females joining the scheme after ag
Page 38 and 39: C.4 PPF Standard FormsThese forms c
Page 40 and 41: Form 1 - Active members at the Rele
Page 42 and 43: Generalised formula for male deferr
Page 44 and 45: Generalised formula for female defe
Page 46 and 47: 1 MGMP 65 = 0 if the member is aged
Page 48 and 49: Pensioner Form 3(b) - GMP only case
Page 50 and 51: GMP pensioners - use this section i
Page 52 and 53: Age at DOR = DOR - DOB (years and m
Page 54 and 55: PLUS applicable to pensioners who h
Page 56 and 57: Calculation of Accumulated Back-pay
Page 58 and 59: Calculation of uplift at Relevant T
Page 60 and 61: Uplift in Pension at Date of Retire
Page 62 and 63: C.5 Examples of theoretical calcula
Page 64 and 65: Active Example 1. Male active membe
Page 66 and 67: Form 1 - Active members at the Rele
Page 68 and 69: Statutory minimum test for NPA 60 t
Page 70 and 71: Deferred pensioner examplesThe exam
Page 72 and 73: Modified Method (2): Opposite sex c
Page 74 and 75: Adjustment to Pension revalued to t
Page 76 and 77: Generalised formula for male deferr
Page 78 and 79: Modified Method (2): Opposite sex c
Page 80 and 81: The revised NPA 65 tranche = total
Page 82 and 83:
Generalised formula for male deferr
Page 84 and 85:
Modified Method (2): Opposite sex c
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Adjustment to Pension revalued to t
Page 88 and 89:
Generalised formula for female defe
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Factors used in the form 2(a) for E
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eing a late retirement pensioner fo
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Pensioner NPA 60 trancheThe member
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Factors used in the Pensioner Form
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1 MGMP 65 = 0 if the member is aged
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Factors used in the Male Deferred P
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Example 5 - Member with tranches of
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Pre 97 Pension at Date retired from
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Back-paymentsThe member is entitled
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Pensioner Form 3(a) - not GMP only
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PLUS applicable to pensioners who h
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Pre 97 PPF compensation at Relevant
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Age at DOR = DOR - DOB (years and m
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Calculation of Accumulated Back-pay
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Pre 97 Pension at Date of LeavingPr
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2.8% and 3% are UK Guaranteed Minim
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Factors used in the Form 3(a) for E
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Factors used in the Form 3(a) for E
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Pensioner Example 6. Male pensioner
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Factors used in the Form 3(b) for E
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May use instead of standard calcula
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Back-payments Form 4(b) - GMP only
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Uplift at Relevant Time (before app
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Calculation of Accumulated Back-pay
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D.1 Factors for calculating opposit
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D.2 Questionnaire to gather scheme
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Early retirement information15. Did
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Late retirement from either active
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NPAFGMP DOLFemale Deferred Pensione
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e.g. 65 MGMP DOL = male GMP at date
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65 to RTEnter 1 if pension does not
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