Public sector pensions and divorce

A public sector pension counts as an asset in a divorce, and the court can split it. The most common route is a pension sharing order, which permanently moves a percentage of your benefits to your former partner. Before that happens the scheme usually has to provide a cash equivalent transfer value, or CETV, so the value of the pension is known. This page gives general information and does not replace a solicitor.

Pension is treated as an asset

NHS Pensions says “The court treats the value of pension benefits as an asset” and may order that value to be shared. The Civil Service Pension Scheme says its pension may be subject to a pension sharing order, a pension attachment order or an earmarking order, and that the court can award part of the pension or lump sum to your former spouse or civil partner.

A family law solicitor deals with how the settlement as a whole works, including how pensions are weighed against a house or savings. These scheme pages do not cover it.

Pension sharing orders

With a pension sharing order, your benefits are reduced by the percentage in the court order. In Scotland it is a cash amount instead. Your former partner receives a pension credit based on that percentage of your CETV, converted using factors for their age and gender. The Civil Service scheme warns that their pension could be higher or lower than what you give up.

Sharing is permanent. It does not revert to you if your former partner dies. If you retire early or on ill-health grounds, the Civil Service scheme says the reduction is applied when your benefits start, and it is also actuarially reduced. If you are already retired, you may have an overpayment to repay because your reduced pension is backdated to the effective date.

In England and Wales the effective date is 28 days after the court order, or the date of the decree absolute or certificate of dissolution if that is later.

Attachment and earmarking orders

An attachment or earmarking order works differently. The court tells the scheme to pay a set amount of your pension or lump sum to your former partner when you retire. The pension payments stop if you die first or if your former partner remarries or enters a new civil partnership. The right to the lump sum survives remarriage, but the order ends if your former partner dies before you.

Getting a CETV

A CETV is the value the scheme puts on your benefits for transfer purposes. At the Civil Service scheme, current members and former members who have not yet drawn their pension can get an estimate free. If you are already receiving your pension there is a charge. You can ask for the estimate when you tell the court about the proceedings.

At NHS Pensions you ask using a PD1 form. If you are an active member or left in the last 12 months, your employer completes a PD2 pay details form as well. The scheme says it will process your request within 3 months of receiving it. Active and deferred members can pay for a CETV within 6 weeks. For a sharing order itself, a PD3 form confirms it. The NHS Pension Scheme guide explains the sections that a CETV is calculated from.

After the order is made

Send the scheme the actual court order as soon as you have it, with the decree absolute, certificate of dissolution or extract decree of divorce. The Civil Service scheme asks you or your solicitor to write with the likely terms before then. Your former partner contacts the scheme at least 3 months before their own normal pension age so a personal details form can be sent. A death benefit nomination in favour of a former spouse or civil partner is cancelled on divorce, so name someone else.

Who pays

The court decides who pays the scheme’s charges, and the order must say who is liable. The Civil Service scheme will not implement an order without payment. NHS Pensions publishes a schedule of charges and a factsheet on administering sharing orders. The figures change, so read the current versions.

If your plan involves moving a pension elsewhere, the pension transfer guide covers the rules. The LGPS guide and Civil Service pension guide describe the other two big schemes. Your scheme can explain its own process, and a solicitor can advise you on your own case.