Pensionable Pay

How is my pension calculated?

Table of Contents

Pensionable Pay

Pensionable pay is the amount of pay on which you pay contributions. From 1 April 2014 it includes non-contractual (as well as contractual) overtime and any additional hours worked in excess of your contractual hours.

Pension Accounts

Under the CARE Scheme you have a Pension Account for each pensionable employment you hold. So, for example, if you hold two separate pensionable part-time employments you will have two Pension Accounts.

Your Pension Account for each employment will hold the annual pension you have built up each year. 

Scheme Year

The scheme year under runs from 1 April to 31 March.

Rate of pension build up

Each year, you will build up a pension at a rate of 1/49th of the amount of pensionable pay you received in that scheme year (or, if you had been on reduced pay due to sickness or relevant child related leave, the pay you would have received). The amount of pension you build up is added to your Pension Account at the end of each scheme year.

For any period you were in the 50/50 section the pension you build up is based on a 1/98th of your pensionable pay.

You can add extra amounts into your Pension Account - for example, if you decide to pay extra contributions to buy additional pension, or you transfer in a pension from another pension arrangement, the amount of extra pension credited will be added to your Account.

In certain circumstances, amounts can be deducted from your Pension Account - for example, if a Court orders that part of your pension should be transferred to an ex-spouse or civil partner following divorce or dissolution of a civil partnership.

Cost of living adjustment

The amount of pension in your Pension Account at the end of each scheme year is adjusted in line with the cost of living - as currently measured by the Consumer Prices Index (CPI) - to ensure it keeps its value. The next revaluation will take place on 1 April 2021 and the percentage increase will be 0.5%.

How a pension will be worked out - an example

Susan is in the MAIN section of the scheme from 1 April 2020 to 31 March 2021 and earned £24,500 in that year.

Scheme year

2020/2021

Section of scheme

MAIN Section

Rate of build up

1/49th of pensionable pay

Pensionable pay £24,500
Amount of pension built up £500 (i.e. £24,500 divided by 49)


At the end of the scheme year, £500 is added to Susan's Pension Account. To make sure the amount keeps it value, the total in the Pension Account will be adjusted in line with the cost of living. If inflation was, say, 3%, the £500 in Susan's account at the end of the scheme year (31 March 2021) would be increased on 1 April 2021 to £515.

Susan remains in the MAIN section of the scheme during the next scheme year (1 April 2021 to 31 March 2022) and earns £25,333 in that year.
 

Scheme year 2021/2022
Section of scheme MAIN Section
Rate of build up 1/49th of pensionable pay
Pensionable pay £25,333
Amount of pension built up £517 (i.e. £25,333 divided by 49)
Amount of pension brought forward £515
Total pension in Account £1,032


So, at the end of the second scheme year, Susan has £1,032 in her Account. As before, to make sure the amount keeps it value, the total in the Pension Account will be adjusted in line with the cost of living. If inflation was, say, 3.1%, the £1,032 in the account at 31 March 2022 would be increased on 1 April 2022 to £1,064.

If Susan had been in the 50/50 section during those two scheme years the amount in her Pension Account would be half the amounts shown above.