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Suspension of Cash Equivalent Transfer Values (CETVs)
Posted on 08/12/2011
Dear Colleague
HM Treasury has revised its guidance on the discount rate used for calculating Cash Equivalent Transfer Values (CETVs). This means that the current GAD advice on actuarial factors for CETVs and related calculations is no longer valid.
As a result the Home Office has informed pensions administrators to suspend all CETV calculations until further notice. This applies to factors used for the following purposes:
- CETVs
- Calculations for pension sharing on divorce
- Non-Public Sector Transfer Club transfers in
The information provided by the Home Office also states:
“HM Treasury have recommended that in cases where administrators have already provided CETVs to the courts in divorce cases on the basis of the old guidance but no final determination has yet been made, the court should be notified of the change in valuation where it might still be in a position to take into account the new valuations. We suggest that in the absence of any factors administrators should advise the court of the situation.
In addition to this we believe there is an exception to the suspension for transfers where a quote has already been given, as we believe this should be honoured (within the 3 month guarantee period).
Other factors not related to CETVs are unaffected.
We will advise you on new factors based on the revised HMT guidance note as soon as possible, but we do not anticipate the relevant actuarial work being completed before the new year.”
I will keep you updated on this issue.
Regards
Ian Rennie
General Secretary
Police Federation of E&W
Federation House
Highbury Drive
Leatherhead
Surrey KT22 7UY
01372.352022
