bbl family law

Finances

Public Sector Pension Calculations

9th January 2012

Many divorcing couples are currently facing delays to their divorce proceedings as a result of the Government's reforms to the way public sector pensions are calculated. The changes in the methods of calculation remain in dispute resulting in couples not knowing the true value of the marital pension pot, or what pension might be received/retained as part of their divorce settlement.

The reforms affect all public sector pensions including, NHS workers, teachers, civil servants etc. The Treasury is reviewing criteria including life expectancy and the likelihood of paying a dependent's pension.

It is important that correct information is known about a couples finances before the court is able to make/approve an order. This includes all financial information including; capital assets, income and pensions. Without full information the parties, and in turn the court, cannot come up with a fair and reasonable outcome.

With pensions on divorce the courts need a figure known as the "Cash Equivalent" value of the fund. However with the current reforms to the calculation process there is some dispute as to the appropriate method of calculation, which can in turn significantly affect upon the Cash Equivalent value given.

Until a resolution has been reached it seems that further delays for some couples are inevitable.

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