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🏛️ Local Government Pension Transfer

Local Government Pension Transfer Understand the LGPS

The Local Government Pension Scheme (LGPS) is a funded defined benefit scheme with excellent benefits. Transferring out requires careful consideration, as you'd be giving up guaranteed, inflation-linked income for life.

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What Is a Local Government Pension Transfer?

The Local Government Pension Scheme (LGPS) is the largest funded public sector pension scheme in the UK, with approximately 6.1 million members and assets of over £394 billion. It provides defined benefit pensions to employees of local councils, schools, police staff, fire service staff, and other public bodies. A local government pension transfer involves moving your LGPS benefits to a personal pension arrangement.

The LGPS changed from a final salary to a career average (CARE) scheme in 2014. Benefits accrued before 2014 are calculated on your final salary, while benefits from 2014 onwards use career average revalued earnings with an accrual rate of 1/49th. The scheme provides generous benefits including inflation-linked increases, spouse pensions, and death-in-service cover.

Transferring out of the LGPS means giving up these guaranteed benefits in exchange for a CETV. Because it is a DB scheme, mandatory regulated advice is required for transfers worth over £30,000. Key considerations include:

  • Funded scheme – unlike most public sector pensions, the LGPS is funded (backed by invested assets), which provides additional security. Each local authority has its own fund managed by an administering authority.
  • McCloud remedy – transitional protections put in place when the scheme changed in 2014 are being addressed through the McCloud remedy. This may increase your benefits and CETV if you were in the scheme before 2014.
  • Normal pension age – the LGPS normal pension age is linked to State Pension age (currently 66). Benefits accrued before 2014 may have a protected retirement age of 65 or 60.
  • 50/50 section – LGPS members can opt for the 50/50 section, paying half contributions for half the pension accrual. If you are in this section, your benefits will be lower.
  • Rule of 85 – some LGPS members have protections under the old Rule of 85, allowing early retirement without reduction if their age plus years of service equals 85.
  • Employer covenant – local authorities are backed by council tax payers and ultimately the government, making the employer covenant extremely strong.
Key fact: The LGPS is the only public sector pension scheme in the UK that is funded by invested assets rather than paid from current taxation. With total assets exceeding £394 billion, it is one of the largest pension funds in Europe.
LGPS Comparison

LGPS Benefits vs Transferred Pension

Compare what you receive from the LGPS against what a transferred pension could provide.

FeatureKeep LGPS PensionTransfer to Personal Pension
Income guaranteeGuaranteed, CPI-linked for lifeDepends on investment returns
Scheme backingFunded scheme, strong employer covenantYour own investment risk
FlexibilityFixed retirement age and structureFull flexibility from age 55 (57 from 2028)
Death benefitsSpouse pension + death grantFull remaining pot to any beneficiary
Early retirementPossible with actuarial reductionAccess any time from age 55
Rule of 85 protectionRetained if applicableLost permanently on transfer
Important: The LGPS is one of the most generous pension schemes in the UK, backed by a funded structure and strong employer covenant. The FCA has found that most people are better off keeping their DB pension, and this is especially true for LGPS members given the scheme’s strength.
Who Is It For?

Who Benefits from LGPS Transfer Advice?

While most LGPS members should keep their pension, there are situations where professional transfer advice is valuable.

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Left Local Government Employment

You have a deferred LGPS pension from a previous role in local government and want to understand whether transferring could benefit your overall retirement plan.

Review your deferred LGPS benefits with a specialist
❤️

Health-Related Considerations

If you have a reduced life expectancy, the guaranteed income may be less valuable and a transferred pot could offer more flexibility and better death benefits for your family.

Explore how health affects the transfer decision
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Want Flexible Death Benefits

The LGPS provides a spouse pension and death grant, but a DC pension allows you to nominate any beneficiary and potentially pass funds tax-free if you die before 75.

Compare LGPS death benefits against DC flexibility
💰

Received Significant CETV

Your CETV statement shows a large transfer value. Professional analysis can determine whether this represents fair value compared to your guaranteed benefits.

Get a full CETV analysis from a transfer specialist
📉

Substantial Other Retirement Income

If you have large other pension pots, ISAs, or investment income, you may not need the guaranteed element of the LGPS and could benefit from greater flexibility.

Model your total retirement income from all sources
🌍

Planning to Live Overseas

If you are relocating abroad permanently, a personal pension may offer more flexibility in how you receive income and manage currency exposure.

Get international pension planning advice

Considering transferring your LGPS pension?

Get matched with an FCA-regulated pension transfer specialist who understands the Local Government Pension Scheme. Free matching, no obligation.

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Costs Explained

How Much Does LGPS Transfer Advice Cost?

LGPS transfer advice requires specialist knowledge of the scheme’s unique features, including the McCloud remedy and Rule of 85.

£1,500–£4,500
Initial Transfer Advice
Comprehensive analysis of your LGPS benefits including pre- and post-2014 benefits, McCloud remedy impact, Rule of 85 protections, CETV assessment, and a personal recommendation on whether to transfer. Legally required for benefits worth over £30,000.
0.5%–1%/year
Ongoing Management
If you transfer, annual fees cover investment management, drawdown planning, and regular reviews to ensure your pot supports your retirement income needs throughout your lifetime.
Worth knowing: Through PensionHelper, our matching service is free with no obligation. LGPS pensions are complex, with pre- and post-2014 benefit structures, McCloud remedy adjustments, and unique protections. Expert advice is essential.
Simple Process

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Your adviser reviews your situation and recommends the best course of action.

Real Reviews

What Our Customers Say

Janet P.
Janet P.
Surrey • LGPS Pension Transfer
★★★★★
“Rule of 85 saved”

I had no idea I was protected under the Rule of 85. The adviser identified this and strongly recommended I keep my LGPS pension. That protection means I can retire at 60 without any reduction. Invaluable advice.

Philip C.
Philip C.
West Midlands • LGPS Pension Transfer
★★★★★
“McCloud remedy explained”

The adviser walked me through how the McCloud remedy would affect my LGPS benefits. It turned out my pension was worth more than I thought because of the transitional protections. Decided to keep it.

Wendy T.
Wendy T.
Hampshire • LGPS Pension Transfer
★★★★★
“Complex situation handled well”

I had LGPS benefits from two different councils plus a separate AVC pot. The adviser reviewed everything together and recommended keeping the main pension but transferring the AVCs for flexibility.

Derek N.
Derek N.
Durham • LGPS Pension Transfer
★★★★★
“Peace of mind achieved”

After 25 years in local government, I wanted to be sure I was making the right choice. The adviser confirmed that keeping my LGPS pension was the best option. Sometimes you just need an expert to confirm what you suspect.

Carol B.
Carol B.
Bristol • LGPS Pension Transfer
★★★★★
“Death benefits were the issue”

My main concern was death benefits for my adult children (no spouse). The adviser showed me how a DC pension would give more flexibility in this area. The transfer was right for my specific family situation.

George F.
George F.
Edinburgh • LGPS Pension Transfer
★★★★★
“Honest and thorough”

The adviser recommended against transferring, even though they would have earned ongoing fees if I had. That honesty told me everything about their integrity. The LGPS pension stays where it is.

Learn More

Related Guides

Explore our guides for more information on local government pension transfers.

DB Pension Transfers

Understanding defined benefit transfers

Civil Service Transfers

Central government pension options

Police Pension Transfers

Police pension scheme options

Public Sector Pension Advice

Advice for public sector workers

Pension Consolidation

Combining pension pots

Pension Transfer Guide

Complete guide to UK pension transfers
Got Questions?

Local Government Pension Transfer: Frequently Asked Questions

Yes, if you have left local government employment and your LGPS pension is deferred, you can request a CETV and transfer it to a personal pension. Because it is a DB scheme typically worth more than £30,000, you must obtain regulated financial advice before any transfer.
LGPS CETVs vary based on your age, years of service, salary history, and the specific benefits you have accrued. Members with long service can have CETVs of several hundred thousand pounds. Request a CETV statement from your LGPS administering authority.
The LGPS is considered one of the best pension schemes in the UK. It provides guaranteed, CPI-linked income for life, funded by invested assets with a strong employer covenant. Contribution rates are competitive, and the scheme offers valuable death benefits and early retirement options.
The Rule of 85 is a protection for older LGPS members allowing them to retire early without actuarial reduction if their age plus years of pensionable service equals 85. For example, a member who joined at 25 and has 30 years of service would meet the Rule at age 55. This protection would be lost on transfer.
The McCloud remedy addresses age discrimination in the 2014 scheme changes. If you were in the LGPS before 2014 and meet certain criteria, your benefits may be recalculated to give you the better of the old and new scheme benefits for the remedy period. This could increase your pension and CETV.
Your pension becomes deferred. You will receive a pension at your scheme’s retirement age based on your accrued benefits. Pre-2014 benefits are based on final salary; post-2014 benefits are career average. You can also request a CETV to explore transfer options.
LGPS members can take their pension from age 55, but benefits will be actuarially reduced for early payment (typically 4% to 5% per year before normal pension age). Members with Rule of 85 protection may be able to retire earlier without or with reduced penalties.
The LGPS is funded – the only funded public sector pension scheme in the UK. Each local authority has its own pension fund with invested assets. This is different from other public sector schemes like the NHS and teachers’ pensions, which are unfunded (paid from current taxation).
LGPS members can pay into Additional Voluntary Contributions (AVCs) alongside their main pension. These are DC pots that can be accessed separately from the main DB pension. AVCs can be transferred to a SIPP without the same restrictions as the main DB pension.
The full LGPS transfer process typically takes 3 to 6 months. Requesting a CETV takes 2 to 4 weeks, the advice process takes 3 to 6 weeks, and the actual fund transfer takes 4 to 8 weeks. Your administering authority handles the scheme side of the transfer.
The LGPS provides a lump sum death grant (typically 3x annual pay for active members), a spouse or partner pension (1/160th of pay for each year of membership), and children’s pensions. These are valuable benefits that would be lost on transfer, replaced by whatever remains in a DC pot.
If you get a new job with an LGPS employer, you will be enrolled into the scheme as a new member. However, you cannot restore the benefits you transferred out – those are gone permanently. Your new membership would start from scratch.
Yes, you legally require regulated advice from an FCA-authorised pension transfer specialist if your LGPS benefits are worth more than £30,000 as a CETV, which is the case for most members with meaningful service. The adviser must provide a personal recommendation.
Since 2014, the LGPS accrues pension at 1/49th of pensionable pay each year (or 1/98th for those in the 50/50 section). Benefits accrued before 2014 were typically 1/60th or 1/80th of final salary. The 1/49th rate is one of the most generous CARE accrual rates in the public sector.
For most people, yes. The LGPS provides guaranteed, inflation-linked income backed by a funded scheme and strong employer covenant. Private pensions offer more flexibility but carry investment risk. The combination of generous benefits, employer contributions of 15%+, and inflation protection makes the LGPS hard to beat.

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