Employer contributions

Employer contribution rates

We write to all employers following each triennial valuation to inform them of their contribution rates for the following three years. Employers' contributions are made up of a future service rate and a past service rate.

Future service rate

Percentage of each contributing member's actual or assumed pensionable pay. The same rate applies to all of an employer's contributing employees. It goes towards the cost of providing pensions for current employees.

Past service rate

The amount for each employer is determined at the fund's actuarial valuation or when an employer joins the Hampshire Pension Fund. It makes good an historic shortfall of contributions. Some new employers will not have a past service rate and may have a higher future service rate instead.

Employee contributions

Employees' contributions are a percentage of their actual pensionable pay, deducted through the PAYE system. You must review the contribution band that each of your employees is in every April. You can review them more often if you choose.

What to do in your payroll and finance system

The employer's contribution on your payroll system should be the future service rate. You should total these contributions each month and pay them to the Hampshire Pension Fund, along with 1/12th of the past service amount and the employees' contributions.

What if I use an external payroll provider?

Liaise with your payroll provider to ensure that your payment to the Hampshire Pension Fund includes the past service amount as well as the percentages deducted through payroll. This also needs to be recorded correctly on the monthly remittance form.

When and how to pay contributions

Pay contributions by 19th of the month after the month in which they were deducted (for example, pay April's contributions by 19th May).

Complete a monthly remittance of contributions form to accompany each payment. The remittance form that we send you each March to use in the next financial year includes the correct future and past service rates.

Pay contributions by BACs into the Hampshire Pension Fund bank account. The account details are:

  • Account name: Hampshire Pension Fund
  • Sort code: 55-81-26
  • Account No.: 88 23 57 42

Pay Additional Voluntary Contributions (AVCs) directly to the relevant provider (Prudential, Zurich or Equitable Life) each month.

Employees who opt out or leave

Employees who leave their jobs or opt out of the LGPS two or more years after joining will be entitled to deferred pension benefits and cannot have their contributions refunded.

Employees who leave or opt out less than two years after joining may receive a refund, but you cannot always recoup contributions for them, as shown below.

Employee opts out less than three months after joining the LGPS

  • Refund employee's contributions through their pay.
  • Recoup any employee and employer contributions by adjusting your next monthly payment and remittance form.
  • You must not adjust the past service amount – it is not affected by employees leaving the LGPS.

Employee leaves employment less than three months after joining the LGPS

  • Pay over all employee and employer contributions that were due.
  • The Hampshire Pension Fund will provide the option to the member for a refund of their contributions if they are entitled.

Employee opts out 3 months to 2 years after joining the LGPS

  • You must pay over all contributions in respect of the member. You cannot recoup them.
  • The Hampshire Pension Fund will provide the option to the employee for a refund of their contributions if they are entitled or a transfer to an another approved pension provider.

Employee leaves employment 3 months to 2 years after joining the LGPS

  • Pay over all contributions in respect of the member. You cannot recoup them.
  • The Hampshire Pension Fund will provide the option to the member for a refund of their contributions if they are entitled or a transfer to another approved pension provider.