British Steel Pension Scheme

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Leaving Service

If you leave the Standard Section before Normal Pension Age, the options available to you are:

If you have less than 3 months pensionable service

You will automatically receive a refund of your own contributions paid to the Standard Section less the following deductions:
  • The appropriate part of the cost of buying back your rights in the State Second Pension (S2P) for the period you have been contracted out as an employee Member of the BSPS and;
  • Tax (currently 20% on the first £20,000 of contributions and 50% on any amount above this limit.
  • A breakdown of the calculation of the refund will be included in the letter provided by the Pensions Office.

More than 3 months but less than 2 years’ Pensionable Service


The following options are available to you on leaving the Standard Section:
  1. A refund of your personal contributions or;
    • The appropriate part of the cost of buying back your rights in the State Second Pension (S2P) for the period you have been contracted out as an employee Member of the BSPS and;
    • Tax (currently 20% on the first £20,000 of contributions and 50% on any amount above this limit).
    • A breakdown of the calculation of the refund will be included in the letter provided by the Pensions Office
  2. A deferred pension or;
    • The deferred pension is payable from the Standard Section at Normal Pension Age to an individual who left Pensionable Service prior to Normal Pension Age. It can normally be drawn earlier – see Early Retirement.
    • You are entitled to a pension of 1/60th of your Final Pensionable Earnings for every year of Pensionable Service up to and including 31 March 2012. For service from 1 April 2012, you are entitled to a pension of 1/65th of your Final Pensionable Earnings 2012.  Months and days are included as part-years in Pensionable Service.
    • Your deferred pension will increase on 1 April each year in line with the percentage rise in the Retail Prices Index over the previous January to January in accordance with the Rules of the Scheme.
  3. A transfer value
    • You can ask that your pension rights be transferred at any time, up to age 64 to another registered pension arrangement including:
      • Your new employer’s pension scheme; or
      • Your personal pension plan, buy-out contract or stakeholder pension
    • The transfer value is calculated using factors provided by the Scheme Actuary and reflects any legal requirements.
    • You can request a quotation of the transfer value of your pension rights from the Pensions Office, who will provide this quote within 3 months of receiving the request.
    • The transfer value quoted will be guaranteed for a 3 month period starting from the date it was calculated.
    • If you wish to consider transferring your benefits from the Scheme, you should write to the Pensions Office requesting details of the current transfer value. Only one quote is normally provided in any Scheme Year.

More than 2 years’ Pensionable Service


If you have more than 2 years' pensionable service, the options available to you on leaving the Standard Section are:
  1. A deferred pension or;
    • The deferred pension is payable from the Standard Section at Normal Pension Age to an individual who left Pensionable Service prior to Normal Pension Age. It can normally be drawn earlier – see Early Retirement.
    • You are entitled to a pension of 1/60th of your Final Pensionable Earnings for every year of Pensionable Service up to and including 31 March 2012.  For service from 1 April 2012, you are entitled to a pension of 1/65th of your Final Pensionable Earnings 2012. Months and days are included as part-years in pensionable service.
    • Your deferred pension will increase on 1 April each year in line with the percentage rise in the Retail Prices Index over the previous January to January in accordance with the Rules of the Scheme.
  2. A transfer value
    • You can ask that your pension rights be transferred at any time, up to age 64 to another registered pension arrangement:
      • Your new employer’s pension scheme; or
      • Your personal pension plan, buy-out contract or stakeholder pension.
    • You can elect to transfer your benefits in full or only the value of any pre-1997 Scheme benefits (whilst retaining the remainder of your benefits in the Scheme).
    • The transfer value is calculated using factors provided by the Scheme Actuary and reflects any legal requirements.
    • You can request a quotation of the transfer value of your pension rights from the Pensions Office, who will provide this quote within 3 months of receiving the request.
    • The transfer value quoted will be guaranteed for a 3 month period starting from the date it was calculated.
    • If you wish to consider transferring your benefits from the Standard Section, you should write to the Pensions Office requesting details of the current transfer value. Only one quote is normally provided in any Scheme Year.