By Adam Cadle
The Ministry of Defence (MoD) has proposed a new pension scheme that will ensure that armed forces personnel continue to receive one of the most valuable public service pensions around.
Despite the fact that the age at which members of the armed forces claim pensions could rise from 55 to 60, the MoD stated that the new scheme design proposals which are set to be introduced from April 2015 will ensure that service personnel do not have to make any personal contributions to their pension and will receive a tax-free lump sum and monthly income if they leave the Armed Forces at age 40 and have served for over 20 years.
The new scheme design will also be based on a career average system rather than final salary and any pension rights accrued under the existing sections will be protected, so pensions earned up to the change over date of April 2015 will be payable at current retirement ages.
Minister for Defence Personnel, Welfare and Veterans, Andrew Robathan said: “The government has had to make some tough decisions to ensure sustainable public service pensions which provide a fair deal for both service personnel and for the taxpayer.
“We recognise that unique commitment made by the Armed Forces and we have done all we can to protect them and make these changes in the fairest way possible. The proposed new scheme will remain among the very best available in the public or private sector, with no individual contributions required by service personnel.”