AP can be purchased by regular monthly contributions over a period of whole years between 1 and 20 and must not extend beyond Normal Pension Age (NPA).
Members can purchase AP which provides only for additional member's pension or which provides for both additional member's pension and additional survivor's pension.
The amount of Additional Pension available to purchase is subject to a maximum limit per annum, originally set in scheme regulations but subject to variation by the Secretary of State.
The costs are shown per £250 pa of AP purchased.
AP is payable either from the age of 60 or the age of 65, as elected by the member at the point of taking out the AP contract. If the member chooses to retire early, AP will be subject to an early retirement reduction in the same way as main scheme pension. See actuarial guidance on early retirement for more detail.
The AP costs have been provided by reference to the member's age last birthday at the date of election. The monthly contributions are rounded to the nearest £0.10.
Generally, factors for calculating the cost to a member of AP should be selected with reference to the:
- member's age (last birthday) at date of election,
- type of AP (member-only or with attaching survivor's benefits (37.5% of member's pension))
- chosen normal pension age (NPA) for Additional Pension (where applicable)
- the date of election, and
- the period over which contributions are to be paid (between 1 year and 20 years)
Where the member elected to purchase a regular contribution AP contract after 31 March 2011, the AP will increase in line with Consumer Prices Index (CPI) before coming into payment. Factors for these elections are contained in Tables x-704 to x-707.
Where the member elected to purchase a regular contribution AP contract on or before 31 March 2011, the AP will increase in line with Retail Prices Index (RPI) before coming into payment. Factors for these elections are contained in Tables x-708 to x-711.