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Preserved Pensions

To explain pension entitlement in the wider Army prior to 1975 there were no rights to preserved pensions in any public or private pension schemes.  Most schemes had very restricted qualifying criteria for the award of pensions. 

 For instance, to qualify for a pension under the Civil Service arrangements, an individual had to be over age 50 and have served for ten or more years.  Those who left voluntarily before meeting these criteria lost rights to pensions.  

For the Armed Forces, occupational pensions were awarded only if a member had at least 16 years qualifying service after the age of 21 as an officer or 22 years qualifying service after the age of 18 as an other rank.   Engagements for shorter periods were on non-pensionable terms. 

Gratuities (lump-sum payments) were awarded to those who did not serve long enough for a pension but had completed at least nine years reckonable service as an officer or 12 years reckonable service as an other rank.  Gratuities were not paid to compensate for lack of pension but rather to assist the individual to settle into civilian life. 

Background to Preserved Pensions

The Social Security Act 1973 brought about changes by requiring UK pension schemes to preserve pension rights for those who left service after 6th April 1975 having completed at least five years qualifying service, and having attained the age of 26.  Later Social Security Acts reduced the qualifying period from five years to two years and removed the age qualification requirement.  These changes were not made retrospective.  Individuals receive the benefits in accordance with the scheme rules in place at the time of their retirement.    

Key Points

The key points to recognise when looking at claims for changes to pension entitlement are:

  • The issue of pre-1975 pensions does not just affect the Armed Forces but is common to all other public service schemes.  
  • AFPS 75 legacy issues are the same in other public pension schemes in existence prior to the Social Security Act 1973. 
  • Where legacy issues are common across public sector schemes, a retrospective change implemented for the Armed Forces would result in pressure from others for similar treatment.
  • It is normal practice in public service pension schemes, and more widely, that improvements should not be applied retrospectively. 
  • In accordance with legal principle, entitlements were tied to the pension rules in force at the date of retirement.

Successive governments have resisted retrospective change to public sector pension schemes, and the policy of no retrospection has been upheld by the European Court of Human Rights.