Members who joined the Scottish Teachers’ Superannuation Scheme (STSS) before 1 April 2007 and were age 50 or over on 1 April 2012, will not join the 2015 Scheme, instead they will remain in the STSS. Similarly, those who joined after 1 April 2007 and were age 55 or over on 1 April 2012 will also remain in the STSS. This is called Full Protection.
Those of you who, on 1 April 2012, were paying into the STSS and were within 13 years and six months of your normal pension age, would not automatically have joined the 2015 Scheme on 1 April 2015. You will continue to earn benefits in the STSS and join the Teachers’ 2015 scheme at a later date depending on your age. This is called Tapered Protection.
You will have received a letter from the Scottish Public Pension Agency (SPPA) if you qualify for either Full or Tapered Protection.
Please note that the normal pension age (NPA) in the 2015 scheme is the same as your State Pension age.
Current and future members contributing to the 2015 scheme, with retirement ages beyond age 65, have the option to take their benefits at age 65 without incurring an actuarial penalty (between 65-68 this is currently set at 3%pa).
Members of the 2015 scheme and their employers can elect to pay extra contributions to reduce or remove the early retirement reduction if you retire after age 65 but before your NPA.
Application to do so can be taken out for 1, 2 or maximum 3 years depending on your NPA.
In certain circumstances, you can select an amount other than a full year only if your NPA is not your birthday eg: if your NPA is 66 years 4 months you could elect to purchase 1 year and 4 months. However, you cannot reduce your early retirement age below 65.
You only have one opportunity to buy out this reduction. Your application must be made within six months of joining the 2015 scheme and will be backdated to your start date.
You should note that you will be required to pay any arrears of contributions back to your start date. As an example, if a member joins the 2015 scheme on 5 May, their application must be made before 5 November.
It is not possible to make a retrospective application.
The cost of this exercise depends on your age in complete years at the day before the effective date of the arrangement and the number of years’ reduction the arrangement is for.
Contributions are payable on all of your pensionable earnings in addition to your normal tiered contributions.
You must pay the extra contributions from the start date of your contract up to your retirement date unless you apply to cease the contract early on grounds of hardship, or leave the scheme.
You must pay the extra contributions on all your pensionable earnings i.e. if you have more than one employment contract, the extra contributions must be paid on each contract. If you change employment you must provide your new employer with information about the extra contributions you are paying for the contract.