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Reserve Service and McCloud

It was not until the introduction of AFPS 15 on 1 April 2015 that the Part Time Volunteer Reserve (PTVR) Service became pensionable for the first time.

In the wake of the McCloud case which ruled that the age based transitional arrangements for transfers to new 2015 public sector pensions were discriminatory, a remedy has been published, offering those affected a choice of schemes.
Some of you have asked if that choice has any implications for your service in the Reserves or the benefits earned during Regular Service. The answer is ‘possibly’, depending on your circumstances.

Here, we set out what you need to be aware of in relation to AFPS75 Immediate Pensions (including commutation), AFPS05 Early Departure Payment (EDP) benefits, AFPS15 deferred pensions and Resettlement Grants.

But first, a little background. Before 1 April 2015, Regular Service personnel were members of either AFPS75 or AFPS05. On 1 April 2015, AFPS15 was introduced and many AFPS75 and AFPS05 members were automatically transferred to AFPS 15 using age-based criteria. Their benefits in their ‘old’ scheme are protected – which means they are payable at the point their ‘old’ scheme would have paid them. Many Full Time Reserve Service (FTRS) personnel, which includes those on additional duties commitments, were transferred from the Reserve Forces Pension Scheme (RFPS) to AFPS 15, too. This means that leavers from the Regular Armed Forces could have:

  • AFPS75 benefits only
  • AFPS05 benefits only
  • A combination of AFPS15 and AFPS75 or AFPS 05 benefits.

There could also be FTRS personnel leaving with a combination of RFPS and AFPS15 benefits. Given the choice now on offer to compulsory transferees, some with prior Regular Service will choose to transfer back to their old scheme and
others will choose AFPS15. But, whatever happens, as PTVR personnel were not pensionable until the introduction of AFPS15, the rules applicable to those serving in the PTVR will remain in place.

AFPS15 features:

  • A pension based on 1/47 of annual pensionable pay
  • Pensions payable at age 60 for those who remain in service until then
  • A deferred pension payable at the member’s state pension age for those who leave before the age of 60
  • Early Departure Payments (EDPs) for Regulars who leave after 20 years’ service having reached 40 (but not applicable to Reserves, who are not eligible for EDPs)
  • Continuity rules, which means if someone leaves the Armed Forces and joins again within five years, their service is deemed continuous. If the break is less than five years, there is no need to serve the two year qualifying period again and the new AFPS15 benefits continue to build on those already earned.

The issues that concern people who are leaving the Regular Armed Forces and joining the Reserve Service are probably easiest to understand if we handle this as they are raised with us, by way of Q&A,, so check back over the next few days when we will offer up answers to common questions on this topic.

Check back tomorrow for the first question in this Q&A series

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