Employer update 08 2019

Operational updates

For action

Do you have members paying Prudential MPAVCS?

On 1 October all Prudential With Profits Money Purchase additional voluntary contributions will cease. In May, we wrote to all affected members, including those who were no longer actively contributing to their With Profits fund. We also emailed affected employers on 16 May.

The only contributions that will continue to be paid to Prudential will be for those members that pay life assurance contributions. Very few members have this option which means that only a small number of employers will need to continue making any contributions to Prudential in their October payroll.

In September we’ll contact all employers who have members who are still contributing to Prudential’s life assurance MPAVC with further information, including details of the members whose contributions should continue. All other contributions to Prudential should stop after the final contribution in September.

There is a dedicated webpage at uss.co.uk/MPAVC19 with further information for members and we’ll include a reminder in our regular member update.

Opt outs and Withdrawals

Collating information about why employees choose to opt out or withdraw helps to inform scheme and product design, and member communications. There’s still time for you to send us your results for April-June 2019.

Last month we told you more about the initial findings of the research and shared the links for you to participate. If you haven’t already submitted your figures, the link’s open until the end of August.

September Retirements - Guidelines

In September we get up to five times as many members retiring as we do in a normal month. Our team are well prepared to handle these additional cases and are already getting ready to process members’ benefits on time. However, we need to work with you make sure that everything goes smoothly. Wherever possible please follow these guidelines for members retiring in September.

• Requests for quotations should already have been received by USS so that we can produce the quote in time for members to consider their options.
• Please submit completed retirement forms (member and employer sections) by 1 September.
  • This helps us to make sure that any USS Investment Builder or Prudential funds can be disinvested and paid on time.
• Use ‘Employer member query’ from member search on the employer portal to send the completed forms directly to the member’s USS record. It’s the most secure way to send a form and starts a process for us straight away.
• If a member has had a quote in the last few months they can use that to choose their benefit options.
  
• We know that sometimes members send you late notification too. Any forms that are sent after 1 September will be processed in the order that we receive them, including quotation requests. We’ll make every effort to pay benefits for these members on the first day of their retirement but in this busy period we can’t guarantee it if the forms received late.

You can check the progress of any retirement quotes you have requested by running the Member Case report from the Run a report page of the employer portal. If you have any queries please contact Andrew Wainwright, Retirements Team Manager RetirementTeam@uss.co.uk.

Enhanced Opt Outs

Enhanced Opt Out enables members who are approaching or have exceeded their Lifetime Allowance to retain death in service and incapacity cover without building up further retirement benefits.

Enhanced Opt Out members and re-enrolment

The Pensions Regulator guidance on automatic re-enrolment notes that “An employer may choose whether to automatically re-enrol any eligible jobholder who has Primary, Enhanced, Fixed or Individual protection from tax charges on their pension savings”. These are HMRC protections but Enhanced Opt Out is a USS option.

This means that if a member only has Enhanced Opt Out then they will need to be re-enrolled back into USS at the appropriate date unless they have an alternative HMRC tax protection.

• Where a member has been auto-enrolled back into USS, they’ll need to re-elect for Enhanced Opt Out by completing new forms.
• Any members opting out within three months will be treated as though they hadn’t re-joined.

Applying for Enhanced Opt Out

To help us process these requests please follow these guidelines:

• Send both pages of the Election for Enhanced Opt Out with continued death and incapacity benefits form.
• Give a minimum of 28 days notice of intention to take Enhanced Opt Out.
• If the member is a multiple appointment holder, we’ll need a form from each institution.

More information about pension tax for USS members, including Enhanced Opt Out, is available from the USS website.

If you have any queries, please contact the Pensions Technical Enquiries team.