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Drawing Pension While Working For BT

29 March 2009

In some areas it seems that incorrect advice has been issued in official briefings suggesting that it is not possible to draw a BTPS pension and work for BT.

Set out below is a copy of a correct explanation of these issues that has been prepared by BT.

BT Pension Scheme: Drawing Pension While Continuing in BT Employment

  • Members aged 50 and above may choose to draw their pension benefits and continue in BT employment.
  • The earliest age at which members will be able to begin drawing their BTPS pension while remaining in BT employment will rise from age 50 to age 55 from 6 April 2010.
  • Any pension drawn before the Normal Retirement Age will be subject to an actuarial reduction on account of early payment and the fact the pension will be paid for longer.
  • Benefits built up before 1 April 2009 would have an early retirement reduction applied appropriate to a Normal Retirement Age of 60, while benefits built up from 1 April 2009 would have an early retirement reduction appropriate to a Normal Retirement Age of 65.
  • Members who draw their pension without leaving BT employment will not benefit from the three year easement of the age 60 Normal Retirement Age.
  • Members who choose to draw their pension while still employed by BT will no longer be covered for death in service benefits.
  • Members who choose to draw their pension while still employed by BT will not be able to build up any further pension benefits in the BTPS, and will not be eligible to join the BT Retirement Saving Scheme (BTRSS).

Leaving BT before 1 April 2012 and drawing an immediate pension

  • BTPS members aged 50 and above who choose to leave BT and draw an immediate pension would be subject to an actuarial reduction applied on account of early payment.
  • In normal circumstances, benefits built up before 1 April 2009 would have an early retirement reduction applied appropriate to a Normal Retirement Age of 60, whilst benefits built up from 1 April 2009 would have an early retirement reduction appropriate to a Normal Retirement Age of 65.
  • However, for members who leave BT before 1 April 2012 and draw an immediate pension, benefits built up both before and from 1 April 2009 will have an early retirement reduction appropriate to a Normal Retirement Age of 60. All other provisions of the Pension Review e.g. ceasing to contract out and Career Average Revalued Earnings etc, will continue to apply to benefits built up from 1 April 2009.
  • The easement will not apply to members who leave BT and do not draw an immediate pension, but choose to draw it at a later date.

Member Enquiries

BT helpline: 0800 731 4747. Email peopleline.pensions@accenture.com