Planning for the future

If you’re a contributing or deferred member of the Group who is approaching retirement, this guide will help you understand the different options for how and when your benefits are paid. 

If you’re a former Gas Scheme member, different benefits may apply to you. Please look out for notices throughout this guide where information is specifically relevant for you. If you are a contributing member, please click here to see an overview of your core benefits as a former Gas Scheme member. If you are a deferred former Gas Scheme member, please click here.

Retirement planning is a complex area which involves making big financial decisions – this guide sets out some of the key points to help you make informed decisions that are right for you. It also has a section about how you can access financial advice, if you feel that you need it.

The information is set out as an interactive guide.

Inside this guide

An overview

of your benefits

Your membership of the National Grid Electricity Group provides you with a number of valuable financial benefits.


When can you retire?

Protection for your dependants

However, changes in pension legislation made in 2015 mean that you now have flexibility over how you access your pension benefits. Instead of taking a pension from the Group, you can access other options by transferring your benefits out of the Group to other approved pension arrangements. There are pros and cons, as this guide will explain. For many members, staying with the Group is likely to be the best choice for them, but for some these other options may be appropriate. If you want to know more about your Group pension, please contact Railpen to request a benefits quotation.


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When can you retire?

This depends on when you joined the Group. For most members, Normal Pension Age is age 60 when your pension can be paid without reduction for early payment; and for some members it’s age 63. For former Gas Scheme members, Normal Pension Age is 65, although you have a right to take your pension from age 60 without reduction. Most members have the option to retire earlier or later.


Railpen will write to you approximately seven months before your Normal Pension Age to ask if you would like to receive details of your Group benefits and retirement options with a view to accessing your benefits.


If you confirm you do, Railpen will send you a Member Options pack. This will contain a quotation of your benefits plus the necessary forms for you to complete and return. If you wish to explore your options outside the Group and you are eligible for funded advice, the pack will provide details about how to contact WPSA, the Group’s appointed independent financial adviser.


If you are a contributing member, still employed by National Grid and paying into the Group, the pension figures shown in your Member Options pack are illustrative and not guaranteed. Contributing members would have to opt out of the Group first in order to transfer their benefits. Once you have opted out of the Group, you cannot opt back in.


If you are a deferred member, your final benefits have already been calculated, and your transfer value is guaranteed for a period of six months. 


You can see the retirement process at Normal Pension Age here.


Retiring early

The earliest age most members can retire is currently age 55. Although this is due to rise to age 57 from 6 April 2028, most Group members will still be able to retire at 55 as they will retain a protected minimum retirement age. 


If you are a former Gas Scheme member and your pensionable service in the Group commenced before 4 November 2021, i.e. if you opted to transfer your past service with the Gas Scheme into the NGE Group when you transferred in 2022, you will also retain a protected minimum retirement age of 55. However, this won’t be the case if, as part of the transfer to NGE Group in 2022, you left your past service benefits with the Gas Scheme, in which case it will be age 57. 


If you choose to retire before your Normal Retirement Age, or before age 60 if you are a former Gas Scheme member, your pension and your lump sum will be reduced to take account of the fact that they are being paid early. 


Some members have the right to retire at age 50 in certain circumstances. For example, if you left service because of redundancy, your deferred benefits will be payable from age 50 without any reduction for early payment (or age 55 if you joined after 6 April 2006 – although this doesn’t apply if you are a former Gas Scheme member who left or leaves service due to redundancy, as you will retain the right to retire at age 50). You may also be eligible to receive your pension before age 55 if you are retiring on ill-health grounds. For further information on this, please contact Railpen.


If you are interested in taking early retirement you can request a quotation from Railpen before your Normal Pension Age. Railpen will provide you with a Member Options pack


You can see the early retirement process here.


Retiring later

Just as you can ask for your pension to start before your Normal Pension Age, you can also take your pension later.


Different rules around late retirement apply to former Gas Scheme members. If you are a contributing former Gas Scheme member, please click here to see an overview of your core benefits. If you are a deferred former Gas Scheme member, please click here.


If you are a deferred member, you cannot postpone payment beyond your 63rd birthday. After the age of 63, pensions will be paid with no additional increases, although arrears are included. Once in payment, pensions are subject to annual increases.


If you are a contributing member, you cannot postpone the payment of your pension beyond your 75th birthday. However, if you carry on working after Normal Pension Age, you will build up extra years of contributing service – for most members this is up to a maximum of 45 years. How this is achieved depends on your Normal Pension Age as set out below:


  • If your Normal Pension Age is 63: you will be required to pay contributions for the extra pensionable service you build up after age 63. 
  • If your Normal Pension Age is 60: no further contributions are payable if you work after age 60, but you will still build up extra pensionable service. This doesn't apply to former Gas Scheme members.


Whatever age you decide to retire, you will still have the option to give up some of your Group pension for a tax-free lump sum when your pension starts.


Additional Voluntary Contributions (AVCs)

If you have purchased Money Purchase AVCs, at retirement, the value of the fund is used to either enhance your lump sum payable from the Group to the permitted limit or can be used to ‘buy’ extra pension by way of an annuity, which you can purchase from the AVC provider or from an alternative insurance company. Please visit the AVC page of the website for more information or speak to Railpen enquiries@railpen.com.

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If you’re made redundant

If you are leaving National Grid on redundancy terms, the information Railpen sends you may not show your latest figures until after you have left the Company.

If you wish to seek advice from WPSA you should make them aware of this, as their advice will need to reflect your final figures.

You should also make your line manager or HR representative aware early in the process, so that they can consider how you can obtain independent financial advice within the relevant timescales.

What is a transfer?

As a contributing or deferred member of the Group, you have the option to move the value of all your benefits in the Group, including your benefits payable on death, to another pension arrangement, where you might have more flexible options for accessing them.


A transfer, or Cash Equivalent Transfer Value (CETV), is the cash value placed on your pension benefits. This is the amount that is available to transfer to an alternative pension plan in exchange for giving up your rights under the Group.


Subject to the rules of the receiving scheme, a transfer payment can be made to another 

HMRC-registered pension scheme. The option to transfer is conditional on certain regulatory requirements including, in most cases, getting specialist advice from a financial adviser before you make any decisions:



The transfer is paid as a single sum of money that is transferred to another approved pension arrangement of your choice. 


If you transfer your benefits, you cannot change your mind later and transfer back into the Group. Likewise, under current legislation, once your pension in the Group starts to be paid, you no longer have the option to take a transfer.


A transfer value is calculated by the Group Trustee on advice from the Group’s specialist actuarial advisers, and by law, it must reflect the expected cost of providing your benefits within the Group. This could be quite different from the cost of buying retirement income from another pension arrangement.


The Group Trustee takes into account certain factors such as how long members are expected to live, what might happen with future inflation, and what might happen to the Group’s investment returns. Transfer values can therefore change, sometimes significantly, as investment markets move or as the Group Trustees’ expectations change.


If you decide to transfer, the benefits you receive will depend on what options your new pension arrangement offers you. There is quite a lot of choice in the market and some of these options are introduced and explained here.


If you are considering transferring your pension, you need to be aware of pension scams.


The transfer process is complex and can take several months to complete, so please take this into consideration when you are planning for your retirement.


Deciding whether to take a transfer value from a defined benefit pension scheme like the Group is a significant decision. 


In recognition of this, current legislation states that anyone who wishes to take a transfer of £30,000 or more must obtain appropriate, independent financial advice before the payment can be made. Proof that you have received this advice will be required before any transfer can go ahead.

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If you transfer

After taking financial advice, you may find that staying with the Group is the best choice for you.

However, one of the reasons that people sometimes choose to transfer their pension out of the Group is that the alternative options give them more flexibility in how they take their benefits.


Let’s have a look at these alternative options.

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Taking advice

Transferring your pension out of the Group may not be in your best interests, as you’d be giving up a number of valuable benefits that may be more suitable for your needs. 


If you are interested in exploring all your retirement options, the Group provides access to independent financial advice for eligible members, to help you make informed decisions, and as far as possible, to help prevent anyone from receiving or acting on inappropriate or fraudulent financial advice. 


This section covers:

  • Who is eligible for paid-for advice?
  • Who is WPSA?
  • Using your own financial adviser
  • Your appointment with WPSA

The Group provides access to funded, independent financial advice through a financial adviser called WPS Advisory Ltd (WPSA). More information on WPSA can be found here. 


There is no obligation for you to speak to WPSA if you do not wish to explore your options further, or if you’d prefer to use your own financial adviser. If and/or when you decide to speak to WPSA is entirely up to you.


Who is eligible for funded advice through the Group?

The majority of contributing and deferred members will be eligible to receive funded advice as they approach retirement. However, a small number of members may not be eligible, for example, overseas tax residents or if you have a very small transfer value. 


As you approach retirement, you’ll receive a Member Options pack from Railpen, which will make it clear whether the offer of funded advice applies to you. 


Even if you don’t qualify for funded advice in relation to your Group benefits, you can still contact WPSA if you want to speak to them, although you will have to pay for this yourself. 


The Group will pay for one piece of advice from WPSA. That one piece of advice might be provided over a series of telephone sessions and through correspondence. In certain circumstances, or if you require further advice after the one piece of funded advice, additional fees will be payable. If this is the case, WPSA will explain any additional fees. This will always be quoted in pounds and pence to you before any discussions go ahead.


While WPSA is able to discuss general tax issues with you, they are not specific tax advisers, so depending on the complexity of your circumstances there may be additional fees payable by you. If WPSA feels you need to seek advice from a separate tax specialist, they will tell you and you will need to meet the costs of this advice yourself.


Do I have to take financial advice?

No. If you are happy to claim your benefits from the Group without looking at other options, there’s no obligation or legal requirement for you to seek independent financial advice or speak to WPSA.


WPS Advisory Ltd (WPSA) is a specialist firm of financial advisers who work with pension schemes, such as the Group, to provide advice and support to their members. They are authorised by the Financial Conduct Authority (FCA) and abide by a set of rules which seek to ensure they always represent members’ best interests. Further information on WPSA can be found in this Q&A.



Who is WPSA?

WPS Advisory Ltd (WPSA) is a specialist firm of financial advisers who work with pension schemes, such as the Group, to provide advice and support to their members. They are authorised by the Financial Conduct Authority (FCA) and abide by a set of rules which seek to ensure they always represent members’ best interests. Further information on WPSA can be found in this Q&A.


WPSA provides bespoke, impartial financial advice based on Group members’ individual pension figures and personal circumstances. They’re familiar with the Group’s Rules and Railpen’s processes and their advice is not conflicted as they don’t sell any products and are not paid commission. They receive the same fees regardless of the recommendations they make and are completely independent of the Group Trustee, the Company, Railpen, and the Electricity Supply Pension Scheme (ESPS). 


You may choose to use WPSA as your adviser if you wish, or you may prefer to use your own financial adviser. You would need to pay for any advice obtained from your own adviser, as the Group Trustee has negotiated preferential rates with WPSA Advisory Ltd and will only pay for advice that is delivered through them.


What does a consultation with WPSA involve?

The aim of the discussion is for the adviser to get a clear picture of how you manage your finances, what your personal circumstances are, and what you are looking to achieve. 


The process will start with an initial discussion with one of WPSA’s Customer Relationship Managers which will last about 30 - 45 minutes. Following this there might be a series of shorter calls to help you gather the information needed prior to your meeting with the adviser. Your first call with the adviser will take around an hour. This might be enough, or you may need further calls depending on the complexity of your circumstances. Once you’ve both agreed on a course of action, WPSA will produce a written recommendation for you and set out any next steps. It would not be unusual for the whole process to take six to eight weeks from your initial discussion or potentially longer if you need to obtain additional financial information.


You can find out more about your appointment with WPSA, including how to set it up and additional charges that may apply, here.


Can I use my own financial adviser?

You are welcome to use your own financial adviser if you wish. However, the Group Trustee has negotiated preferential rates with WPSA Advisory Ltd and will only pay for advice that is delivered through them. You would need to pay for any advice obtained from an alternative adviser.


If you use your own adviser, check the Financial Services Register to make sure that anyone offering you advice or other financial services is FCA-authorised. If you don’t use an FCA-authorised firm, you also won’t have access to the Financial Ombudsman Service or the Financial Services Compensation Scheme, so you are unlikely to get your money back if things go wrong. 


If the firm is on the FCA Register, you should call the Consumer Helpline on 0800 111 6768 to check the firm is permitted to give pension transfer advice. If your adviser does not have this permission, the Group Trustee cannot pay the transfer.

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