How does redundancy affect your LGPS pension?

If you are facing the prospect of redundancy, it’s important to know that your Local Government pension is in safe hands.

The following information will help you understand what happens to your pension, depending on your age and how long you have been in the scheme.

Less than two-year membership

If you have been a Local Government Pension Scheme (LGPS) Member for less than two years and have been made redundant, you’ll usually have three options:

  • Claim a refund of your contributions.
  • Transfer your benefits to another pension.
  • Delay your decision until you either rejoin the LGPS, or decide to do either of the above.

55 and over 

If you’re made redundant over the age of 55, your pension and lump sum may be paid to you immediately, without any reduction.  

To qualify, you must be a member for at least two years, which is known as the vesting period. Visit our Local Government pension FAQs page for more details.  

Please note, if you have paid additional pension contributions, that extra pension may be reduced. 

Under 55

If you’re made redundant while under 55, your pension becomes deferred.

This means you can no longer contribute to it, but we’ll look after it for you until you reach retirement age.  

You can choose to take your pension and lump sum between the ages of 55 and 75, although your benefits will be reduced if you take them before normal pension age, which is linked to your state pension age (usually over 65). 

To learn more about deferred pension benefits, visit our LGPS Deferred Benefits Fact Sheet on our Forms and Documents page.

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