The ARBO cost, for a member retiring early who is a premium or nuvos member, should be calculated as:

ARBO cost = P x F_x

Where:

x is the member's age at retirement date in years and complete months

P is the unreduced pension at retirement date (including added and transfer in pension)

F_x is the relevant factor for a member aged x, taken from:

• Table P1ARBO60, for a NPA 60 premium member
• Table P1ARBO65FS, for a NPA 65 premium member or linked service benefits for a nuvos member
• Table P1ARBO65NUV, for a nuvos member (excluding pension credit members)
• Table P1ARBO60NUV, for a nuvos pension credit member

The ARBO cost should be calculated before the member commutes pension for lump sum and before offsetting any divorce or scheme pays debits.

Pension credit members in premium have the option to buy out the actuarial reduction. The ARBO cost should be calculated as described above for a premium member.

Pension credit members in nuvos have the option to buy out the actuarial reduction. Their pension is payable unreduced from age 60. Different factors are required to calculate the ARBO cost for nuvos pension credit members compared to those used for normal nuvos members. The appropriate factors are described above.