Combined Nuclear Pension Plan

The Combined Nuclear Pension Plan is the occupational pension scheme for people working in nuclear decommissioning. It is a multi-section scheme: a Final Salary section for older benefits, a CARE (career average) section, and a Defined Contribution structure that new joiners go into. Pension age under the Plan is 65, and the minimum age at which you can normally take money from a pension is 55, rising to 57 from 6 April 2028¹.

What you pay depends on your earnings band. The Plan sets member and employer rates in a table, and the bands are fixed on 1 April each year¹. Your employer pays at least 8% of Pensionable pay into the fund, and the maximum total employer contribution is 13.5%². Contributions come out of gross pay before income tax, so the cost to you is reduced¹.

The Plan does not accept transfers in from other pension arrangements, so you cannot consolidate an old pot into it². It does allow transfers out of Defined Contribution benefits, and does not require you to take regulated financial advice first, though it recommends it².

What the Combined Nuclear Pension Plan is and who it covers

The Plan is an occupational pension scheme, and the Defined Contribution Structure is a section within it². It is registered with HM Revenue & Customs under the Finance Act 2004, because registration provides certain tax advantages². It covers employees of nuclear decommissioning employers, and the Lead Company specifies which allowances count towards Pensionable Pay².

Pensionable Pay is defined as permanent basic pay, responsibility allowances, Pensionable shift pay plus any other allowances specified by the Lead Company². Pensionable Earnings, which drive contributions, usually include only permanent items of pay such as salary or wages and responsibility allowances¹. That distinction matters: overtime and one-off payments are generally not pensionable, so a pay rise built on permanent salary raises your pensionable pay, while a bonus may not.

The Plan sits alongside your State Pension rather than replacing it. The Plan states that in addition to your pension from the Plan you will also receive your entitlement to Single Tier State Pension when you reach State Pension Age, which is currently 66 and rises from 66 to 67 between 2026 and April 2028². For the wider picture of how workplace and personal pensions fit together, see Pensions: a complete guide.

Final Salary, CARE and Defined Contribution: how each section builds your pension

The three sections build your pension in different ways, and which one applies to you depends on when you joined and which employer you work for.

The Final Salary section works from a formula based on your pay near retirement and your length of service. A comparable final salary calculation used in the sector is (1/90 x Final Pensionable Salary below the Scheme Specific UEL x Pensionable Service) plus (1/60 x Final Pensionable Salary above the Scheme Specific UEL x Pensionable Service)³. In plain terms, service below the earnings threshold builds pension at a slower rate than service above it.

The CARE section builds pension from your career average earnings rather than your final salary, so each year of service adds a slice based on what you earned that year. The Defined Contribution structure is different again: your contributions and your employer's go into a fund that is invested, and what you end up with depends on how much goes in and how the investments perform. New joiners go into the Defined Contribution structure².

How contributions work: what you and your employer pay

Your contribution rate is set by which earnings band your Pensionable Earnings fall into. The bands are fixed on 1 April each year and apply for a year, even if your Pensionable Earnings rise or fall during that time¹. The Pensionable Earnings bands increase in line with the Consumer Price Index each year, and your contribution rates increase on 1 April every year up to and including 1 April 2027¹.

The current table of rates is set out in the Plan's own member booklet, and the administrator can confirm which band applies to you.

Your employer's contributions are set at a level agreed with the Trustee, expected to provide enough funds to pay the agreed level of benefits, having taken advice from the Plan Actuary and in accordance with relevant legislation¹. Beyond the main benefits, your employer pays for the lump sum death in service benefits under the Plan and meets all the administrative and governance costs of providing your Final Salary and CARE benefits¹. Your employer also contributes in relation to Shift Pay Pension Plan benefits and meets the advisory costs of running the SPPP and Additional Voluntary Contributions benefits¹. You pay charges for investment and administration services for SPPP and AVC benefits, deducted from your SPPP or AVC fund value¹.

If your Pensionable Earnings reduce because of certain types of statutory leave, such as paid maternity, paternity or adoption leave, you remain in the earnings band established at the previous 1 April, and that band is applied to the reduced Pensionable Earnings received in each pay period¹. More generally, during paid leave you and your employer continue making pension contributions, with your contribution based on your actual pay during that time⁴.

Tax relief, the Annual Allowance and salary sacrifice

Contributions are taken from gross pay before income tax, so the cost to you is reduced¹. The Plan gives a worked example for an employee with Pensionable Earnings of £60,000 contributing at 6% and paying tax at 40%: a net deduction from pay of £180, tax relief of £120, and a total employee contribution of £300¹. Note that different tax rates apply in different countries within the UK¹.

Tax relief is available on contributions up to 100% of your annual earnings, subject to the annual allowance⁵. Stakeholder pensions follow the same principle, with tax relief on contributions of up to 100 per cent of earnings each year depending on an annual allowance⁶. The Money Purchase Annual Allowance is £10,000⁷. Separately, guidance on pension freedoms describes the Money Purchase Annual Allowance as having limited tax relief on pension contributions to up to £4,000 each year for people affected by it⁸. The two figures differ, and the documents do not resolve which applies in a given case, so check your own position.

Salary sacrifice is a separate arrangement where you give up part of your pay in return for an employer pension contribution. Income Tax and National Insurance contributions reliefs on pension contributions are worth over £70 billion per year¹⁰, and one estimate puts the cost of the salary sacrifice incentive at over £20 billion a year¹¹. Reform is coming: from 6 April 2029 the Optional Remuneration Arrangements excluded exemption for employer pension contributions for Class 1 National Insurance contributions is removed for salary sacrifice arrangements exceeding the annual cap¹². Employers do not pay National Insurance contributions on pension contributions, but employees and self-employed people do¹³. Both you and your employer contribute the full standard rate of National Insurance under the Plan's current arrangements¹.

Leaving the Plan, opting out and rejoining

Members are automatically enrolled and may opt out by contacting the Plan administrator, and there is one opportunity to re-enter the Plan². If you opt out, you are treated as any other leaver². More generally, you can opt out of a workplace pension at any time, usually by filling in a form and returning it to your employer or pension provider, and your employer must re-enrol you every 3 years¹⁴.

Where a jobholder opts out, any contributions paid by the jobholder, or by the employer on their behalf, on the basis that they had become an active member must be refunded in accordance with prescribed requirements¹⁵. The Plan has its own rule: if you have less than 30 days of Qualifying service, you receive a refund of your contributions; if you have 30 or more days, the fund remains invested².

If you want to change your contribution level, you must give your employer at least one month's notice, and the Trustee may deduct costs if you change more than once in any 12 months². If your circumstances change, for example your pay or working pattern, tell the administrator so your records stay accurate¹⁶.

Taking your pension: Pension Age, early retirement and your options

Pension age under the Plan is 65². The minimum pension age under HMRC rules is currently 55, and it is planned that from 2028 this will increase to 57². You may access your pension early after age 55 if you give written notice to the Trustee of at least one month².

Across pensions generally, the earliest you can take any of your pension money is usually age 55, rising to 57 from April 2028¹⁷. Personal and stakeholder pensions usually allow access from 55, depending on your arrangements with the provider¹⁸. Most pension schemes have a maximum age by which you must start taking your money, usually 75²⁰. If you are over 55, you may be able to take a personal or workplace pension early²¹.

Drawdown allows you to keep your pension invested and draw out income as and when you wish, taking out as much as you want, although this money is subject to income tax²². The Plan allows you to take up to 25% of your fund as a tax-free lump sum². Whether drawdown is available inside the Plan or requires a transfer out depends on your section, so ask the administrator before assuming either route.

Ill-health retirement and serious ill-health lump sums

If you retire early through ill-health, there may be special terms in the scheme rules that allow for the pension to be enhanced²³. Ill-health pensions are protected against inflation and are increased annually in line with the Consumer Price Index²⁴. If you are over 55, you may be able to take a personal or workplace pension early²¹, and if you retire due to cancer you may be able to get your pension early depending on the rules of your scheme or employer²⁵.

Where life expectancy is less than a year, you can take up to 100 per cent of your pension fund as a tax-free lump sum under serious ill-health rules²³. The Plan's standard tax-free lump sum allowance is up to 25% of your fund², so the serious ill-health route is a distinct and more generous provision that applies only in specific circumstances.

Death benefits and your Expression of Wish

For new joiners to the GPS DRS section, the death in service lump sum is normally three times Pensionable pay². Lump sums are payable at the Trustee's discretion, and the Trustee may be unable to pay benefit to an unmarried partner unless they are nominated on an Expression of Wish form².

That form is the mechanism that tells the scheme who you would like to receive your pension. Pension providers ask you to complete an expression of wish form, and it should be kept updated²⁶. You can fill in or update an expression of wish form by logging in to the online account for each pension you hold, or by contacting the scheme directly²⁷.

If you die while in drawdown, the tax treatment depends on your age: if you are under 75, any drawdown benefits can usually be passed on as a lump sum free of tax, and if you are 75 or older, dependants pay tax². Keeping your Expression of Wish current is the single most useful thing you can do here, because the Trustee's discretion is exercised on the basis of it.

Transferring out: the Plan does not charge, but check before you move

Defined Contribution benefits may be transferred to one or more suitable arrangements, and you are not required to take regulated financial advice before the transfer can take place, although the Plan recommends it². You can usually transfer or consolidate your pensions at any point, unless the scheme rules list restrictions²⁸, and you can transfer your UK pension pot to another registered UK pension scheme²⁸.

The process normally runs in this order: check your current scheme allows transfers out; make sure you will not lose any benefits; decide which scheme to transfer into; check whether you need to pay for financial advice; ask your current provider for a transfer value; and ask the new scheme to start the transfer²⁸.

Complaints, statements and how the Plan is protected

The Trustee writes to you once a year with an annual statement of benefits, and the Trustee's Annual Report is published on the Plan's website². If you are unhappy, the Plan's route is its Internal Dispute Resolution Procedure through the Plan Administrator, and after that you are entitled to raise your case with the Pensions Ombudsman, which can be contacted on 0800 917 4487².

The Pensions Ombudsman can look at complaints about how personal and occupational pension schemes are run²⁹, and deals with some complaints about the administration of workplace pensions³⁰. Outcomes are recorded as upheld, partly upheld or not upheld³¹. Common complaint topics include overpayments, ill-health pensions, death benefits and incorrect pension information³². If you are concerned about the way your employer is dealing with automatic enrolment or managing your workplace pension, you can contact The Pensions Regulator³³.

On protection, the Pension Protection Fund exists to compensate members of eligible defined benefit schemes whose employer has failed. Only payments from pension built up after 5 April 1997 rise in line with inflation each year, subject to a maximum of 2.5%, and payments built up before that date do not increase³⁴. The Pension Schemes Act 2026 will enable inflation increases, up to 2.5 per cent per year, on all or a proportion of pre-97 compensation payments where the original schemes provided for mandatory or statutory pre-97 increases³⁶. All complaints to the PPF can be escalated if you are not happy with the first response³⁷.

Public sector pensions are increased in line with the Consumer Price Index every April³⁸, and the Plan's own Pensionable Earnings bands also rise with CPI each year, while the Earnings Cap increases broadly in line with the Retail Prices Index¹. For free, impartial help with any pension question, MoneyHelper is the government-backed service, and the Pensions Ombudsman publishes member guidance covering how to complain, common complaint topics, who can complain and what it can and cannot do³⁹.