Principal Pension Scheme

Brief Outline

A brief outline of the main provisions of the pension scheme is provided in the following notes. For further information you should contact the Local Authorities Pension Fund or read the Rules of the Principal Pension Scheme.

The Contribution Rate totals 23.3% made up as follows:
  • Emplooyer   17,3 %
  • Employee    6%
  • Total           23,3%

  • Eligibility-All Local Authority Employees who are under the age of 60 years are eligible
  • Retirement age - 55 to 65 and is optional to the contributor
1) Early retirement - 3% per annum reduction for each year below 60

2) Normal Retirement - 60 years- 100% benefit payable

3) Late Retirement - 6% per annum incremental factor for each year above 60 years (maximum of                                     65 years)

4) Ill Health Retirement

            4.1) 10 or more years of service pension calculated based at age 60 i.e. 100% benefit.
            4.2) 5 years or less than 10 years one receives a specially calculated pension as advised by the               Actuary.


5) Pension Benefit - Defined benefit based on average annual salary over the last 24 months preceding retirement and current accrual rate is 1/600 for each month of service. Pension is guaranteed for 7 years and thereafter for life.

6) Pre-retirement spouse's pension-  25% of annual salary at date of death.

7) Children's Pension- Maximum of 3 children at any one time.

7.1) If member leaves spouse :

3 children - 50% of widow's pension

2 children -37,5% of widows pension

1 child - 25% of widow's pension

7.2) If member leaves no spouse:

3 children -100% of pension that would have been payable to the widowed spouse whichever is greater.

2 children -75% of pension that would have been payable to the widowed spouse.

1 child-50% of pension that would have been payable to the widowed spouse.


8) Death Benefits

2x(accumulated contributions plus 1/400 for each month of service) plus a spouse's and children's pension as in 5 and 6 above


9) Death after retirement

Lump sum of the unexpired guaranteed period and thereafter a spouse and orphans pension based on salary at retirement.

10) Withdrawals

    10.1)  A refund of contributions plus interest accrued at 1/400 for each month of service plus employer's portion computed according to he sale below. 

Number Of years Of Service % of Employers Portion Plus Interest
Less than 5 years Nil
5 years 30
6 years 40
7 years 50
8 years 60
9 years 70
10 years 80
11 years 90
12 years 100

10.2) Accumulated interest in the fund is payable if pensionable service amounts to 15 years or more  and the contributor is below the age of 55. This benefit is payable on condition that the entire capital sum is utilised to purchase a retirement annuity from a registered insurance company.

11)Commutation Factors

Dependant on the age at retirement (i.e. 55-65 years)

OOne third of pension can be commuted for a single cash sum.

12)Contribution Rates

6% employee, 17,3% employer but reviewed every 3 years by the Fund's Actuary

13) Pension Increases

Determination by the management Committee on an annual basis taking into account inflation and the Fund's Actuary's recommendation.

14) Voluntary Additional Contributions

Payment of additional contributions to purchase and additional pension or relevant past service is permitted. This enables contributors to enhance their pensions on retiring.


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