This guidance is addressed to the Department of Finance (DoF) as scheme manager of the Civil Service Compensation Scheme (Northern Ireland) (CSCS(NI)).
The purpose is to provide DoF with guidance for calculating commutation of the member's Annual Compensation Payment (ACP) and to capitalise employer costs in relation to those payments.
Capitalisation of employer costs is not covered by the CSCS(NI) rules, as it is unrelated to scheme benefit provision. The approach set out in this guidance is in line with previous advice to DoF and overrides the approach set out in the archived Civil Service Pensions Manual.
Under the CSCS(NI), scheme members are able to commute their ACP at normal pension age.
No new ACPs will be awarded since the CSCS(NI) rules were amended in 2014. However, some members previously awarded an ACP will still be aged under 60 and therefore subject to commutation and capitalisation provisions.
The following changes have been made when reviewing this guidance:
- Important information around the expected audience for the guidance, use of the guidance, review of factors, compliance and limitations applies across all sets of guidance. Rather than being repeated in each set of guidance, this can now be found on the scheme home page. It is important to read this information alongside the guidance.
- Calculation methodology: No changes have been made to the calculation methodology.
- Examples: There are no examples in this guidance. Worked examples, using the calculation methodology, can be found in prior versions of the guidance (though please note that these use historic factors).
- Factor tables: The "Factor Tables" tab contains the names of the tables that are referenced in the calculation methodology. The tables of factors themselves can be found in the most recently published "Consolidated Factors Workbook" which is available by clicking the "Download current Consolidated Factors Workbook" button on the scheme's home page.
- Assumptions: The key assumptions underlying the factors in each note are contained in the Consolidated Factors Workbook.
- Regulations: The regulations that require the production of the actuarial factors and/or guidance that is the subject of this note are summarised in the "Regulations" tab.
