ABSTRACT
The actuarial reduction ensures that voluntary early retirement does not increase the scheme's overall costs and the contributions required to fund it. Thus the amount of pension and lump sum paid on voluntary early retirement comprise the amount accrued at the date of retirement less any actuarial reduction, which is calculated by the Government Actuary's Department. NHS employers may offer voluntary early retirement without any actuarial reduction of accrued benefits; however, they have to fund the extra costs incurred by waiving this reduction. The Health Department has issued a circular to all NHS employers explaining that the new arrangements are entirely voluntary and should not be regarded as a substitute for existing arrangements. The employer must meet the cost of the pension from the date of retirement up to the normal retirement age of 60, as well as the cost of paying the lump sum before normal retirement age.
