A surprising number of people are asking us via the Veterans’ Gateway whether they can swap their pension entitlement for a one-off lump sum!
The question probably arises because of the Chancellor’s ‘Lamborghini’ change to pensions rules which allowed those paying into a private pension to take the whole lot as cash instead of buying an annuity.
Public sector pension schemes are defined benefit scheme so do not fall into the category the change applied to. So, for AFPSs and RFPS, the answer is ‘no’ not normally. The exception is for AFPS 05, AFPS 15 and RFPS members who are not in receipt of their pensions, and are terminally ill – they can exchange their pension rights for a lump sum worth five times their pension. There is no similar provision in AFPS 75.