Changes to APS Pension Factors from 1 October 2025
12 September 2025
As part of the Scheme’s regular valuations, the Scheme Actuary reviews the factors used to calculate certain pension options. Following the most recent review, some of these factors are being updated with effect from 1 October 2025.
These changes may affect members who:
- Are over their NRA and have not yet retired or drawn their pension benefits, or
- Are considering transferring their pension to another provider.
We are sharing this update now so that you are aware of how these changes could influence your retirement decisions particularly if you are already planning to retire in 2025.
Why do factors change?
The Scheme’s Actuary reviews factors regularly to ensure they remain fair and up to date. These changes can increase or decrease the value of your pension or lump sum and may fluctuate over time. It’s important to avoid letting short-term factor changes drive your retirement decisions as pensions are a long-term commitment.
Drawing your pension before Normal Retirement Age (NRA)
If you take your pension before your NRA, it will be reduced to reflect the longer period it is expected to be paid. The earlier you retire, the greater the reduction.
- No change: Early retirement factors remain the same from 1 October 2025.
Drawing your pension after Normal Retirement Age (NRA)
If you take your pension after your NRA, it will be increased to reflect the shorter period it is expected to be paid.
- Change from 1 October 2025: Pensions taken after NRA will be higher than before.
The new late retirement factors only apply from the date of the change, they are not retrospective, so any pension built up before 1 October 2025 remains unchanged. Delaying your pension start date by a matter of days or weeks after 1 October 2025 will not result in a sudden increase in your pension as the higher uplift will only apply for the period after 1 October. The uplift that has already been built up to 30 September 2025 is not affected by this change.
Remember, by postponing your pension, you will lose the payments for the months you have delayed payment, even though your monthly pension amount going forward may be slightly higher.
Cash Equivalent Transfer Values (CETVs)
If you are a deferred member (no longer actively contributing), you may transfer your pension to another registered pension arrangement before you start drawing it.
- Change from 1 October 2025: CETVs from APS are expected to be up to 0.5% higher for each year you are younger than NRA.
Transferring your pension is a complex decision and, in most cases, you must take professional advice from an independent financial adviser. Please note that while the underlying factors are expected to improve CETVs, CETVs are also adjusted monthly to reflect current market conditions. Therefore, it is still possible for a CETV after the factor change to be lower than before.
What happens next?
- All retirement benefits are calculated using the factors in force at the date of retirement.
- These changes could affect your pension if you are planning to retire shortly before or after 1 October 2025.
- Updating factors takes several months, so until they are in place, BA Pensions cannot provide individualised quotations. The information above is intended as guidance only.
Things to consider
- Think long term, avoid letting short-term changes dictate your retirement decision.
- The later you take your pension, the higher your annual pension will be.
- Independent financial advice is strongly recommended before making any decision about your benefits.
If you decide you would like to take your pension, please contact the BA Pensions team as soon as possible.