Information for IFAs
The information provided on this page is designed to provide financial advisers with relevant information required in conjunction with the provision of independent advice to members of the Airways Pension Scheme (APS).
The information is subject to the provisions of the Scheme's Trust Deed and Rules. If there is a difference between the Trust Deed and Rules for the Scheme and the information provided on this page, the Trust Deed and Rules will prevail. The Trust Deed and Rules for the Scheme are on the Scheme documents page.
New Pension Wise guidance regulations from 1 June 2022
New regulations have come into force which are intended to increase the take-up of free pensions guidance from Pension Wise, in order to help individuals make informed decisions about their options when accessing defined benefit pensions that include Additional Voluntary Contributions (AVCs). When an individual applies to draw or transfer out their pension, we will direct them to appropriate pensions guidance available through Pension Wise.
When an individual applies to draw their Scheme pension benefits, we will:
- Offer to book a Pension Wise appointment for them; and
- Provide them with details to allow them to book an appointment themselves.
We will ask our member to complete a form to confirm that:
- They have received Pension Wise guidance; or
- The guidance does not apply to them (for example, because they have received regulated retirement advice within the previous 12 months); or
- They wish to opt out of receiving Pension Wise guidance.
We have published our Pension Wise Guidance pack on the Forms page of our website. The pack includes details about Pension Wise and the relevant forms to fill in when our member draws their pension benefits.
- The Airways Pension Scheme (APS) is an occupational final salary scheme. The Scheme is a Registered Pension Scheme approved under Chapter 2 of the Finance Act 2004. The PSTR number is 00302323RH.
- The Scheme was contracted-out of S2P by the GMP test until April 1997 and subsequently under the Reference Scheme Test until 5 April 2016. ECON and SCON numbers are E3800146P and S0301443W.
- The Scheme is closed to new entrants but is currently open to further accrual.
- The standard build-up rate for active members is 1/52 (Flying Staff) or 1/56 (Ground Staff). Active members currently under State Pension Age (SPA) can choose to build a pension at a slower rate of 1/54 (Flying Staff) or 1/58 (Ground Staff) for future service. The option to switch is available twice a year, on 1 April and 1 October. More information about this can be found on the 'How much does it cost?' page.
- The Normal Retirement Age (NRA) is 55 for Flying Staff and 60 for Ground Staff.
- There is no money purchase underpin.
- The Scheme is in deficit.
- Further information, Scheme booklets, The Scheme's Trust Deed and Rules and Scheme valuation reports can be found on the Scheme documents page of our website, www.mybapension.com
- When a member leaves British Airways or opts out of the Scheme, they will usually be entitled to a deferred pension due to be paid from their NRA.
- Once members leave the Scheme, they cannot re-join. However, while still employed by BA they have the option to join the British Airways Pension Plan (BAPP) which is a defined contribution arrangement, administered by Aviva Life & Pensions UK Limited.
- APS deferred pensions increase as a right under the Rules of the Scheme up to NRA. The increase is in line with that specified in the Government's yearly Pensions Increase (Review) Orders. These Orders currently reflect the increase in the Consumer Prices Index (CPI), but the method of measurement is determined by the Secretary of State and may change from time to time. The APS Trustee has a power to pay increases in addition to those set out in the Pensions Increase (Review) Orders if, after taking professional advice, it agrees this to be appropriate.
- APS increases Guaranteed Minimum Pensions (GMPs) up to GMP Age (age 60 for women and 65 for men) in line with S148 Orders.
- The Scheme complies with current anti-franking legislation.
- The Scheme does not currently allow partial transfers (e.g. a transfer of the member's excess pension over the GMP, leaving behind the GMP). However, members can transfer out their AVCs independently to their main Scheme benefit, subject to certain statutory conditions being met.
- APS is not a member of the transfer club.
- A partial transfer option is available, subject to certain qualifying conditions. To find out more information about this option please read the 'Can I take a partial transfer out' FAQ.
- Members have an option to transfer all or part of their AVCs independently from their main scheme pension. If a partial transfer is requested, an AVC transfer out form will also be required if AVCs are to be included with the partial transfer of main scheme benefits.
- Members are entitled to a maximum of four Cash Equivalent Transfer Value (CETV) quotations per year. CETVs in respect of deferred pension entitlements are guaranteed for three months. Further CETV quotations will not be provided during the guarantee period.
- If a transfer out is to be made, all required CETV forms (transfer out packs are available to download from the forms page) must be completed and returned within the three-month guarantee period. No discretion will be allowed in respect of CETV forms returned late. Please ensure the member reads the transfer pack carefully as it contains useful links and guidance from The Pensions Regulator about transferring benefits to another pension arrangement.
- Death-in-service cover of three times pensionable pay is provided for active members of the Scheme.
- In the event of the member's death before the pension commences, if no Adult Survivor's pension is payable, a refund of the member's own Scheme contributions, plus interest at 3.5% a year up to the date of death, would be payable. If the member has an AVC account the value of the account at the date of death would be added to any lump sum death benefit payment.
- The Adult Survivor's pension shown on the Benefits Summary would be payable to the member's legal spouse or civil partner. If there is no legal spouse or civil partner at the date of death, the Trustee has a discretionary power to pay this benefit to a 'surviving dependant'. A surviving dependant is someone who is, in the opinion of the Trustee, financially dependent on the member to a substantial extent at the date of the member's death; or who, to the Trustee's satisfaction, is financially interdependent with the member and will need the extra income to sustain the same standard of living that previously depended on joint income, e.g. someone who lived in a relationship with the member that closely resembled marriage.
- Pensions in payment are not guaranteed to be paid for a minimum period.
- APS members who have left BA employment can draw their pension at any time from age 50 up to a maximum age of 75. All their pension benefits must be drawn, including any AVCs and Scheme benefits from previous BA Schemes. This does not apply for those who have opted out of the pension scheme and remain in employment with British Airways, the earliest that pension benefits can be drawn is the earlier of a) the date employment with BA ends or, b) the member's 55th birthday.
- At retirement, members normally have the option of a one-off tax-free lump sum up to 25% of the value of their benefits. Lump sums are payable by exchanging pension (commutation).
- We do not provide pension projections beyond NRA. Equally, we cannot provide future lump sum projections as commutation factors are regularly reviewed by the Scheme's Actuaries and may be subject to change.
- The Scheme does not offer a bridging pension option at retirement.
Any element of the member's deferred pension paid earlier than NRA will be actuarially reduced or actuarially increased if paid after NRA. The current APS Part 6 Scheme factors are below. These factors are regularly reviewed and may therefore change at any time.
Male and Female factors (unisex) Age Factors
55 1 0.875 (E) 22.619 56 1.109 (L) 0.897 (E) 22.193 57 1.223 (L) 0.92 (E) 21.758 58 1.341 (L) 0.945 (E) 21.314 59 1.464 (L) 0.972 (E) 20.860 60 1.593 (L) 1 20.396 61 1.728 (L) 1.108 (L) 19.922 62 1.869 (L) 1.222 (L) 19.438 63 2.018 (L) 1.34 (L) 18.946 64 2.175 (L) 1.465 (L) 18.446 65 2.34 (L) 1.597 (L) 17.940 66 2.517 (L) 1.738 (L) 17.429 67 2.704 (L) 1.886 (L) 16.914 68 2.903 (L) 2.045 (L) 16.395 69 3.115 (L) 2.213 (L) 15.872 70 3.341 (L) 2.393 (L) 15.344 71 3.583 (L) 2.585 (L) 14.810 72 3.841 (L) 2.792 (L) 14.269 73 4.119 (L) 3.014 (L) 13.721 74 4.417 (L) 3.253 (L) 13.165 75 4.738 (L) 3.511 (L) 12.604
(E) = Early retirement reduction
(L) = Late retirement uplift
Pension increases are a right under Scheme rules and are in line with the Government's Pensions Increase (Review) Orders. The increases over the last five years have been as follows:
2023 2022 2021 2020 2019 10.1% 3.1% 0.5% 1.7% 2.4%
APS Discretionary Increases
2023 2022 2021 2020 2.5% 1.8% 0.6% 0.6%
- Pension increases are applied to the whole pension inclusive of GMP liability before GMP Age (age 60 for women and 65 for men). After GMP Age the increase is only applied to the excess pension over the GMP. Post '88 GMPs are increased in line with legislation up to a maximum of 3% in any year after GMP Age or before GMP Age for spouse's/civil partner's benefits. Scheme increases are generally applied in April each year and apportioned in the first year according to the date of leaving. The Rules do provide for Discretionary Increases. There is no minimum guarantee period for payment of the pension. There is no bridging/supplementary pension provided.