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Items of interest to Infrastructure members transferred to Network Rail
1. Transfer estimates delayed
2. Members over 50
3. Money Purchase Scheme advice
Infrastructure Maintenance members who have joined the Network Rail Section of the RPS have been expressing concern at the delay in receiving transfer information from Pensions Management. Members' past service benefits in their IMC's Section will be automatically transfer to the Network Rail Section unless the member opts that it should not be transferred. Scheme Rules say that members have six months from the date of transfer to make a decision on their transfer. However, such decisions obviously cannot be made without detailed information showing the affect on benefits already earned, but delays have occurred because Pensions Management has been unable to verify data with some employers.
In the case of former Jarvis employees, the six month deadline is 1 October. Pensions Management are aware that members cannot be expected to take such decisions without having first considered the implications and I have therefore written seeking an extension to that deadline where there has been a delay in providing transfer details.
Network Rail Money Purchase Scheme - Election of Investment Fund
Employees enrolled in the Network Rail Money Purchase Scheme are required to nominate the investment fund, or funds, where their pension contributions should be invested. This is not a decision the Trustees can make on the member's behalf. Failure to nominate an investment fund or funds by the three month deadline will result in exclusion from the Scheme. Exclusion from the scheme obviously means members will lose not only valuable employer contributions towards their pension and the prospect of joining the Final Salary Scheme at a later date, but also the death in service protection.
It is therefore essential for members to make an investment nomination within the three month deadline. Although Network Rail has promised to contact all employees who have not indicated their preferred investment fund, members should not delay their decision as no contributions will be invested on their behalf until the option has been received.
In returning their option form members should indicate at which level they wish contributions to be deducted. The default option is O% employee and 3% employer which is obviously inadequate. The maximum member level is 4% which attracts an employer contribution of 7%. Members are urged to contribute at the highest level possible, but are reminded that contributions are based on all earnings, not the lower pensionable pay element used for the RPS.
Transfer of Benefits - Staff over 50 years of Age
It may be in the best interests of members over fifty years of age to draw their RPS pension rather than transfer it Network Rail. Documentation from Pensions Management does not highlight this option and I am advised that many members over age fifty are merely opting to transfer as a matter of course. I would therefore urge members over age fifty to give consideration to that possibility, although, such decisions should not be taken without financial advice.