Losing your job through redundancy can be an uncertain and worrying time. Alongside questions about future employment and finances, many LGPS members want to know what will happen to their pension.
The good news is that the pension benefits you have built up in the LGPS remain secure. What happens next depends largely on:
- your age; and
- how long you have been a member of the scheme.
If you are under age 55
If you are made redundant before age 55 from your LGPS job, your LGPS pension is not paid straight away. Instead, the benefits you have built up are normally deferred, meaning they remain in the scheme until you choose to take them.
A deferred pension continues to benefit from annual inflation protection while it remains in the scheme. You can usually choose to claim your pension from age 55 onwards, but taking it before your Normal Pension Age will normally result in a reduction because it will be paid for longer.
If you have less than two years' membership, different rules may apply and you may have options such as a refund of contributions or a transfer to another pension arrangement.
If you are aged 55 or over
For LGPS members aged 55 or over who are made redundant from their LGPS job, the position can be very different.
If you have at least two years' membership in the LGPS and leave because of redundancy or business efficiency, your pension is normally paid immediately. Importantly, there is no reduction for early payment.
This means you will begin receiving the pension benefits you have built up without waiting until your Normal Pension Age. Any standard redundancy payment from your employer is separate from your pension benefits.
Only your employer can request a formal redundancy estimate, but you can get a broad idea of how much you might get on grounds of redundancy by looking at “Section 2: Summary of total benefits as at 31 March 2026” on your most recent benefit statement. You can find your statement on your My Oxfordshire Pension account.
The amounts are not guaranteed. Your statement cannot cover every circumstance and in the event of any dispute, we will refer to the appropriate legislation and regulations. Your statement does not give you any contractual or statutory rights, it is for your information only.
Voluntary redundancy
Many members ask whether the same pension rules apply if they volunteer for redundancy rather than being compulsorily selected.
In the LGPS, the same redundancy retirement rules generally apply to both voluntary and compulsory redundancy situations.
Looking ahead
The Government has announced that the minimum age at which most LGPS benefits can be accessed will increase from 55 to 57 on 6 April 2028. Existing protections may apply to some members, but anyone approaching retirement should check how future changes could affect their plans.
Need more information?
Every redundancy situation is unique. Your employer's HR team and the fund can explain the options available to you and help you understand the choices you may need to make, but only your employer can request a formal redundancy estimate from the pension team.
While redundancy can be challenging, understanding how your LGPS benefits work can provide some reassurance and help you plan for the future.
For more information
If you are a scheme member head to: https://www.oxfordshirepensionfund.org.uk/members/active-members/redundancy-aged-over-55 or
If you are an employer looking for more information, you can look here: https://www.oxfordshirepensionfund.org.uk/employers/leaving-and-retirement/redundancy-or-efficiency