Pension Supplement

[GRUSS]

I retired from Royal Mail about 4 years ago and at the time was advised I would receive a pension supplement of £439 up until state pensionable age. I would have received my usual rpi increases on the whole of my pension but my question is do they only deduct the original £439 when I reach official state pension age or would it be a larger amount bearing in mind the rpi inceases on that amount.

With thanks,

[RobertT]

To be honest I don’t know the answer for sure, but I would have thought you will lose the £439 plus the RPI increases over those 4 years.

[GRUSS]

I know I will lose the supplement but not sure about the increases. I called the RM Pensions but could not give me an answer.

[RobertT]

I’m not surprised you couldn’t get an answer off the pensions service centre, they are hopeless!

I think your best bet is to work out whether you have actually been getting RPI increases on the supplement over the last 4 years.

If you haven’t then you will just lose the £439.

If you have then I would assume you will lose the RPI increases on the £439 aswell. Because otherwise your future pension will be based on your supplement increases aswell as the pension itself.

[GRUSS]

I have today called the pension helpline but not very helpful regarding my query. I retire on the 5 September 2015 and still no letter advising by what my pension will drop to because of the pension supplement. I originally was receiving £480 a year from November 2010 and would like some idea how much my supplement would drop by. Pension helpline said I should have had a letter by now but nothing show on their system. If for instance the total rpi increased over that time are say 16 percent would I add this to the £480 to give me some idea.

Any help appreciated.

[RobertT]

I think you’re splitting hairs a bit here. Based on the two initial figures you’ve given of £439 and £480, your supplement is probably currently about £500 or £550 per year assuming RPI increases. So expect a reduction of around £10 per week.