CDC 2024

[RobertT]

Thanks for the reply. I'm wondering about the impact of a possible pay rise from the deal. I'm section C and I think the pensionable pay element on the pay slip may change, so I'm wary of increasing the Flexi plan by too much. AVCs are somewhere North of 43k at the moment but not sure if I'll get the full 25% from them as a lump sum. I didn't ask you where you worked btw.

Pensionable pay and actual pay are different, pensionable pay goes up on 1st of April by the rate of inflation the previous September regardless of actual pay changes.
For example if the current deal is agreed our actual pay will increase by 6% backdated to April 1st this year and by 2% from April 1st next year (forget additional lump sums, they're not relevant here).
Last September the RPI rate of inflation which is used for Section C was 12.6% so our pensionable pay went up by that amount, you will probably have noticed a small reduction in take home pay because of this.
Inflation has fallen a bit so lets say the RPI rate in September this year is 7%, next April our pensionable pay will increase by that amount but our actual pay will only rise by 2% and there will be a further reduction in take home pay because more of our pay which was non pensionable will become pensionable.

Section C pensionable pay increases are capped at 5%. For clarification, just check the messages part of your last payslip for the 22/23 tax year(week 52).

As far as I'm aware, that also applies to section A/B. Although without looking at the 2014 changes booklet I'm not 100% sure.

[vmaxv4]

Section B 10.1% actual rise from April this year. However the full amount wasn’t paid until 11th April.

[Jefferson Starfish]

Section B 10.1% actual rise from April this year. However the full amount wasn’t paid until 11th April.

They're talking about the amount of your pay that is pensionable and how much it increases by. Not how much your actual pension increases by.

[vmaxv4]

[heapsy]

Thanks for the replies everyone. Gives me an idea when / if the deal is approved of how much extra I can put in the AVCs. Cheers.

[renrag40]

Your pensionable pay increases each April based on the RPI figure the previous September. It is capped at 5% for members who are still paying into their pension. This applies for Sections A, B and C.
The proposed pay deal will have little effect on your pensionable pay. The relationship between actual pay and pensionable pay was broken in 2014. The only effect will be on assigned pensionable allowances, for example, late shift allowance which at present is about £50 which with the proposed 6% pay rise would add £3 to your pensionable.
You will know the pensionable pay increase for April 2024 when the September RPI figure is published in October.
Once you start drawing your pension the rise in April will be based on the previous September CPI figure for members in Sections A and B , which is uncapped. For members in Section C the pension rise in April will still be based on the previous September RPI figure, capped at 5%.
This has generally worked to the financial benefit of members in Section C as the RPI figure is always higher than the CPI figure. It is only in this period of high inflation that the 5% cap for members in Section C has been triggered.

[RobertT]

Your pensionable pay increases each April based on the RPI figure the previous September. It is capped at 5% for members who are still paying into their pension. This applies for Sections A, B and C.
The proposed pay deal will have little effect on your pensionable pay. The relationship between actual pay and pensionable pay was broken in 2014. The only effect will be on assigned pensionable allowances, for example, late shift allowance which at present is about £50 which with the proposed 6% pay rise would add £3 to your pensionable.
You will know the pensionable pay increase for April 2024 when the September RPI figure is published in October.

Your pensionable pay figure is on your wage slip under 'Pensions Contrib Pay'. That should have increased by 5% from 1st April.
Your pension contribution should be 6% of that figure, unless you're in the RMDCP and have chosen to pay less.

Pension Contrib Pay won't increase again when you get your pay rise, because as you say, actual pay was delinked from pensionable pay in 2014. That applies to pensionable allowances just as it does for basic pay.

The delinking only applies to members of the RMPP. So will not affect RMDCP members and will not be a feature when the CDC scheme finally starts, assuming it actually does.