Possible pension changes would undermine the Armed Forces Covenant Forces Pension Society warns Government
Fears that the Government may be considering a potential reduction in the pension Lump Sum Allowance (LSA) in the forthcoming budget have caused concern across the military community. The Forces Pension Society reports many of its 66,000 Members are expressing anxiety at the prospect of having carefully considered Resettlement and Retirement plans thrown into uncertainty.
Chief Executive of FPS, Maj Gen Neil Marshall has written to the Chief Secretary to the Treasury and the Minister for Veterans and People, highlighting the potential impact on those serving in the Armed Forces should the Government reduce the present level of the Lump Sum Allowance; the letter can be seen on the Society’s website:https://forcespensionsociety.org/
Maj Gen Neil Marshall said:
“I have pointed out that the tax-free lump sum is a key element in the current AFPS schemes on departure from the Armed Forces and into the civilian workforce. Firm financial and life plans have been made on the assumption that the tax-free lump sums owed to them would honoured after, in many cases, between 20 and 40 years’ public service.
“I cannot think of a budgetary measure more ‘counter’ to the Armed Forces Covenant than one that could significantly reduce the pension payments military people receive when they complete their service over coming months and years.
“It would undermine confidence and trust across the entire military community, seriously eroding ‘the offer’ and have a potentially significant impact on retention, and by extension, recruitment.
“The purpose of the AFPS is to sustain operationally effective Armed Forces by incentivising service and providing a financial platform for a second career as a demonstration of the nation’s commitment to those who have served their country.”
The Forces Pension Society is an independent, not-for-profit membership organisation, providing pension guidance for its Members along with numerous other benefits. If you would like to join us, please visit forcespensionsociety.org