References
Armed Forces Redundancy Scheme 2006(AFRS 06)
- This scheme is for the members of the Armed Forces Pension Scheme 2005 (AFPS 05).
- Compensation Lump Sum (CLS) - A tax-free lump sum that is only available to AFRS06
participants and is paid in addition to AFPS 05 benefits.
Armed Forces Redundancy Scheme 2010(AFRS 10)
- This scheme is for the members of the Armed Forces Pension Scheme 1975 (AFPS 75).
- Special Capital Payment (SCP) - A tax-free lump sum that is only available to AFRS10
participants and is paid in addition to AFPS 75 benefits.
Final Pensionable Salary
This is an SPVA generic term which can be applied to either Final Relevant Earnings
(AFRS 06) or Basic Pay Rate (AFRS 10)
Higher Rank and Higher Paid Salary
These are SPVA generic terms that relate to AFRS10 members – Please ensure you read
the relevant Introduction and Help Station Notes.
Terms & Conditions
The Armed Forces Redundancy Calculator (AFRC) is for guidance purposes only.
It is not intended to provide you with financial advice. If you require financial
advice, you should contact an independent financial adviser. Your unit administration
staff has a list of Services Insurance and Investment Advisory Panel (SIIAP) approved
independent financial advisers, although you are free to use any independent financial
adviser that you wish.
The AFRC provides you with a forecast under AFRS 06 and AFRS 10, along with the
pension benefits you could expect to receive under AFPS 05 or AFPS 75. The AFRC
does not show dependents benefits, ill-health benefits, pension sharing figures or Additional Voluntary Contributions.
The calculator will initially ask you to confirm which redundancy scheme you are
in. The Pension forecasts that the calculator provides are based on extant Pay rate
codes effective from 1 Apr 11 (for AFPS 05 members) and pension codes effective
from 1 Apr 11 (for AFPS 75 members).
"IMPORTANT INFORMATION"
Redundancy Reckonable Service for AFRS 10
Statutory Instrument No 832 The Armed Forces (Redundancy, Resettlement & Gratuity Earnings Scheme) (No 2) Order 2010 defines
‘redundancy reckonable service’ as any period of service referred to in paragraphs (2) and (3) of the Order ‘whether current or
previous service’ since age 18. This is being changed to ‘whether current or previous aggregated service’. This change will
affect the way in which the SCP element is calculated as it now excludes previous service, which has not been aggregated with
current service. Any period served on gratuity earning terms where the gratuity lump sum has not been forgone or repaid does not
count towards qualifying or reckonable service and hence is not included in the calculation of the SCP element. To obtain your
forecast for SCP and Pension benefits you should enter your current period of service only if you have not elected to aggregate
them. However, if you have written into SPVA, address below, to aggregate your service, you should enter your previous service
together with the relevant break in service to obtain your combined forecast.
Please refer to JSP 764 Part 5 Chapter 3, which gives guidance on how to calculate your SCP.
Aggregation of Previous Armed Forces Preserved Pension Awards
If you have rejoined the Armed Forces and have a preserved pension award
in the AFPS 75 you are entitled to aggregate your most recent period of previous
service with your current service. However, you must apply to do so in writing,
to SPVA, Pensions Division (Aggregation), Mail Point 480, Kentigern House, 65 Brown Street, Glasgow, G2 8EX before terminating your service.
If you are a member of AFPS75, have insufficient service on your current engagement
and have not opted to aggregate your previous service you may not qualify for immediately
payable pension benefits. You will only be entitled to a second preserved pension
award.
If you are a member of AFPS 05 and are aged 55 or over on the date you leave service,
and have not opted to aggregate your previous service, your immediate pension at
age 55 or over will be based on your current period of service and your earlier
service will be paid to you as a preserved pension at age 65. If you leave service
before the age of 55 with insufficient service for an early departure payment, your
previous and current awards will be deferred until you are age 65.
To calculate your pension forecast for aggregated service you add your preserved
pension service to your current service.
Length of Service
The various calculation methods, used in the redundancy calculations refer to either
completed or uncompleted service.
Completed Service/Redundancy Reckonable Service see:
- JSP 764 Part 5 0205bi (AFRS 06(AFPS05))
- JSP 764 Part 5 0305bi (AFRS 10 (AFPS75))
Uncompleted Service See:
- JSP 764 part 5 0205bii (AFRS 06(AFPS05))
- JSP 764 Part 5 0305bii (AFRS 10 (AFPS75))
Completed Service/Redundancy Reckonable Service
Does not include:
- Unpaid Additional Maternity Leave (AML)
- Unpaid Additional Adoption Leave
- Unpaid Additional Paternity Leave
- Reckonable service for pension purposes transferred from another employer’s pension
scheme, private pension plan or purchased by way of added years
- Reckonable service that is not aggregated with current service for pension purposes
RELEVANT SERVICE FOR AFPS 06
Only service which determines a person’s entitlement to an Early Departure Payment (EDP) is counted, as
‘relevant service’ as defined in Statutory Instrument No 437 The Armed Forces EDP Scheme Order 2005 as follows:
- all paid service on or after 6 April 2005 (includes previous service on or after 6 April 2005);
- all qualifying service transferred from AFPS 75 to AFPS 05 under the OTT; in the case of an opt-out, the
period of qualifying service that he would have been entitled to count under the Offer To Transfer (OTT) had he
been a member of AFPS 75 less service before age 21 (officers) or age 18 (Ors);
- all qualifying service transferred from GPS to AFPS 05 under the Gurkha OTT
- any period on secondment to NATO/UK etc. where the member has the option to increase his reckonable
service by the purchase of added years equal to the length of his secondment.
This excludes all previous AFPS 75 service which has not been transferred under the OTT arrangements.
RESETTLEMENT GRANTS
Under AFPS 05 entitlement to a Resettlement Grant is based on ‘relevant service’ as defined above. All previous
AFPS 75 service which has not been transferred under the OTT is excluded.
Under AFPS 75 entitlement to a Resettlement Grant is based on relevant years of reckonable service. For an officer
(who has held officer rank for at least 2 years) this is 9 years after reaching the age of 21. For Other Ranks,
this is 12 years from the age of 18.
Medical and Dental Officers under AFRS 06
The AFRC will not provide Early Departure Payment (EDP) details for Medical and Dental Officers (MODO) who have at least 18 years service and have reached age 40 or over. It will however, provide a forecast for a compensation lump sum and pension benefits at age 65.
An individual on bonus conditions is normally excluded from EDP arrangements, however under redundancy access to the EDP Scheme is permitted providing you meet the qualifying criteria of at least 18 years service and be at least aged 40. In such cases, the bonus payment will normally be recovered from the EDP lump sum where the required return of service has not been completed. For more information on the MODO bonus scheme and redundancy see JSP 764 Part 4 Chapter 7. If you have any queries or require a full redundancy forecast please contact your Service Redundancy Cell who will be able to meet your request.
Acting Rank (AFRS 10 Only)
You will be required to enter additional Acting Rank information during the later
calculation processes and must read the Acting Rank Help Station Notes fully in
order to ensure that an accurate SCP calculation is made.
Medical
A person cannot be considered for redundancy compensation if he leaves the service
on Invaliding terms. JSP 764 Part Ch 2 0203 (e) Ch 3 0303 d) refers.
Opted Out AFPS 75 or AFPS 05
If you have opted out of AFPS 75 or 05 in favour of your own private pension
arrangements you will need to contact your Unit HR for advice on compensation benefits.
Personnel who have less than 2 years completed service
If you have less than 2 years completed service, the AFRC will not provide you with
a Redundancy Forecast. However; it is relatively easy to work out your redundancy
CLS using the following formula:
Identify your completed service and convert the days to a decimal (divide them by
365). Identify your FRE and divide it by 1/8th and multiply the two results together
e.g.
1 yr 250 days divide the days by 365 x 14200 pounds (FRE) divided
by 8
1yr +(250/365) x (£14200.00/8)
1.6849 x £1 775.00
£2990.70
If you are unsure of any of the details or steps required to make this calculation
please contact your Unit HR who will give you further advice.
Gurkhas
Members of the Gurkha Pension Scheme will not be able to use this calculator to
obtain a forecast.
Gurkhas who transferred to the AFPS 05 and have service before 1 October 93 Other
Ranks and 1 July 1997 Officers will not receive an accurate pension forecast from
the AFRC. However the CLS will calculate correctly as long as your completed
service is entered accurately and correctly.
Gurkhas who transferred to AFPS 75 and have service before 1 October 93 Other Ranks and 1 July 1997 Officers, will need to contact their HR Unit.
Life Commutation
AFRS10 - The AFRC does forecast Life Commutation.
Disclaimer
Although every effort has been made to ensure that the information provided is as
accurate as possible, no representation or warranty, express or implied, is given
as to its accuracy and the MOD does not accept any liability for error or omission.
The MOD shall not be liable for any loss or damage arising from the use of, or inability
to use, the Redundancy Calculator, or any material contained in it, or from any
action or decision taken as a result of using the Redundancy Calculator or any such
material.
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the preceding instructions and are aware of all
the relevant documentation relating
to your AFPS and AFRS.
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