Membership of CAB 2011 was only available to active members and who chose to join CAB 2011 before 1 January 2012
What is CAB 2011?
The CAB 2011 section is a pension arrangement under which benefits build up year on year and reflect your earnings during your membership of the Scheme.
Who can join CAB 2011?
Membership of CAB 2011 was only available to employees who were active members of the Scheme on 30 November 2010 and who chose to join CAB 2011 before 1 January 2012.
Do I have to be a CAB 2011 member?
No, you do not have to be a CAB 2011 member.
You can end your membership of CAB 2011 without leaving service, subject to at least two months' notice. To do so you will need to complete an opt-out form,which you can get by contacting the pension service line.
Once you have opted out, you stop building up benefits and become a life assurance member. This means your life cover for death in service reduces from four to two times your life cover pensionable salary less any other lump sum payable from the Scheme on your death and less any lump sums from commutation paid to you by the Scheme in respect of your current period of employment.
Pension provision is an important element of your reward package. By opting out you will be giving up a valuable benefit. Therefore, before making such a decision, you should consider taking Independent Financial Advice.
Rejoining the Scheme
Having opted out, you will not be able to rejoin the Scheme. Instead, you will be able to join LifePlan - the BBC's defined contribution plan, contact the pension service line for further information.
How much does it cost?
Benefits are paid for partly by you and partly by the BBC; details are set out below.
Your share of the cost
Currently you pay 6% of pensionable salary. This can be varied if both the BBC and Trustees agree to do so.
As a CAB 2011 member your contributions will normally be met through salary sacrifice; this is called 'Smart Pensions'. Your basic salary is reduced, currently by 6%, and the BBC pays an equivalent amount as an employer contribution to the Scheme on your behalf. Because your basic salary is lower, you will usually pay lower National Insurance contributions.
The income tax you pay is unaffected by Smart Pensions. This is because PAYE income tax is always applied to earnings after any pension contributions have been deducted. There is a maximum pensionable salary on which contributions and pension benefits are based. It is called the CAB 2011 Earnings Cap (£144,000 for the year beginning 1 April 2015) and is expected to increase each year in line with the Consumer Prices Index (CPI).
For some members (e.g. those on low pay or receiving State benefits) Smart Pensions may be disadvantageous. If you are one of them, you will be excluded automatically and alternative arrangements will be made to collect your contributions. If you want to know more about Smart Pensions, there is a leaflet you can get by contacting the pension service line.
In addition to whatever contributions they pay under Smart Pensions, the BBC and other participating employers pay contributions to cover the balance of the cost of providing your Scheme benefits, as agreed with the Trustees. In other words, your employer carries the investment and longevity risks associated with providing the benefits you have been promised.
You can pay additional contributions through the BBC defined contribution plan (LifePlan) to boost your pension benefits.
For CAB 2011 members only, the BBC will match your contributions to LifePlan up to certain limits:
- For members earning less than £10,000 per year, BBC contributions are capped at 3%
- For members earning more than £10,000 per year, BBC contributions are capped at £300 per year
The BBC will match (up to the above limits) contributions paid on pensionable salary only
It's easy to join LifePlan and pay addtional contributions, simply go to ecommunity.aviva.co.uk/group/bbc-lifeplan-additional-contributions, click on the 'Join now' button and complete the online form.