Flexible Retirement under SUPS
The flexible retirement arrangements allow active members of SUPS to remain in employment at Swansea University and continue to build up pension benefits in the scheme, whilst drawing some of their accrued pension benefits. Scheme members will be required to provide SUPS with formal notice of their intention to flexibly retire at least two months prior to their selected retirement date.
Eligibility for flexible retirement
Active, eligible members of the scheme will be able to apply to their employer to flexibly retire under these provisions. Flexible retirement will not be available to deferred members or in respect of any variable time employment.
Requirements/features of flexible retirement
There are a number of requirements which must be met within the SUPS rules for flexible retirement:
- the SUPS member must be aged 55 or above;
- they must have ‘qualifying service’. This is normally a period of at least two years' pensionable service;
- the prior written consent of the employer is required;
- a SUPS member must reduce their working hours by a minimum of 20% and also reduce their salary by a minimum of 20% on a long term basis (and in any event for no less than 12 months);
- the proportion of benefits to be drawn is a minimum of 20% and a maximum of 80%of the member’s total pension and lump sum at the date of flexible retirement;
- benefits will be actuarially reduced to the extent that they are payable before the member’s normal pension age;
- a SUPS member may elect to flexibly retire on a maximum of two occasions, following which the member must draw further benefits only by retiring in full. When a member takes a second flexible retirement, the maximum proportion of benefits he/she may receive on the second flex is 80% of the accrued benefits less the percentage of benefits drawn on the first flex.
Members of staff must apply for consent to reduce working hours and salary and for flexible retirement using the form available for this purpose. Consent must be obtained from the Head of College/Director in the first instance followed by authorisation by the Human Resources and Finance Departments.
Following submission of the form, a formal provisional quotation of benefits on flexible retirement, a ‘request for a flexible retirement quotation’ form will be completed by the Pensions section of the Finance Department.
A quotation prepared by the trustee company will be provided to the employer, along with a copy for the employer to provide to the member.
If the member of staff accepts the quotation, a decision on consent will then be made by the Director of Finance. Where consent is given, the member of staff may then make an election to SUPS through the Pensions Section of the Finance Department to flexibly retire.