Glossary

The basic pension includes a pension for your spouse or partner when you die (if you paid for this cover). The Adult Survivor's pension is 2/3rds of the member's pension for all service for which Adult Survivor's pension cover contributions were paid.

A legal spouse or registered civil partner would automatically qualify for this benefit. Members who are not married or in a registered civil partnership but who have a common-law spouse, live-in partner or someone financially dependent upon them to a substantial extent, can ask the Trustee to consider their dependant for a discretionary pension. See Surviving Dependant for more details.

Set by HM Revenue and Customs. The maximum value of benefit a person can build up in a pension scheme each tax year without incurring a tax charge. The AA is currently £60,000.

From 6 April 2016 a 'Tapered AA' was introduced, which may affect deferred members who chose the three-year promotional/incremental pay link transitional option when NAPS closed to future pension build up on 1 April 2018. If this applies, and you have earnings (defined by HMRC as Threshold Earnings) of £200,000 or more, you may be affected by the tapered AA. See The tapered AA for more details.

See The Annual Allowance (AA) page for more information about the AA.

The total market value of the investments and cash held by the Scheme, built up from contributions made by BA and the Scheme members plus investment returns.

British Airways plc or any other company in the British Airways group which used NAPS to provide its employees’ pensions.

BA pays whatever is necessary to provide your benefits as advised by the Scheme’s actuary.

BAMPS is the Money Purchase Section of NAPS, which closed to future contributions on 1 October 2012. The contributions made by members and BA up to 30 September 2012 were invested and continue to grow with interest. At retirement BAMPS members can decide the type of pension to buy with the money invested in their individual BAMPS retirement account or they can take your 'pot' as a cash lump sum.

You can read more about BAMPS here.

The calculation used to work out the pension you will receive when you retire, worked out at the earlier of the date you left NAPS or 31 March 2018.

(Pensionable Service x Retiring Pay) divided by 75.

The rate at which your pension grew while you were making contributions. The standard rate was 75 for all Staff from 1 October 2010.

NAPS members could choose faster Build-up rates of 1/67 or 1/60 by paying extra contributions.

An insurance policy that covers a proportion of a pension scheme’s liabilities and is held as an asset of the pension scheme. The scheme pays a premium to an insurance company in return for the policy, and the policy pays an income that is related to the liabilities insured. This removes the risk that the value of a scheme’s assets won’t be enough to meet future liabilities. The Trustee and BA have ultimate responsibility for making sure the Scheme can meet members’ benefits.

An insurance policy which replaces a pension scheme’s obligations to pay members’ pensions with individual annuity policies between the insurer and each member. The policy will reflect exactly the benefits provided under the pension scheme. As funding levels improve and pension schemes continue to mature, many schemes see buy-outs as the final step in reducing the risks involved in pensions.

A member who chose to stop paying contributions to the Scheme at or after Normal Retirement Age but has left their pension aside for drawing at a later date. Late retirement uplifts are added to the pension for the period since contributions stopped to date of drawing.

Since 6 April 2015, people with defined contribution (DC) benefits have had greater flexibility on how they access their pension savings from age 55. AVCs you have paid into the Scheme are DC benefits, but you will have to transfer your AVCs out of the Scheme to one or more different pension providers if you want to access them under the Government’s flexible access rules.

You can choose to transfer just your AVCs out of the Scheme or you may choose to transfer your main Scheme pension out as well. Before transferring benefits out of the Scheme you should get free guidance from Pension Wise (www.pensionwise.gov.uk) to make sure any new arrangements meet your needs and that you fully understand how this will affect any tax you have to pay.

The full range of DC options is complex and the suitability of the options depends on the size of an individual's DC pot and retirement income requirements.

The difference between the value of a scheme’s assets and its liabilities, if the value of the assets is not enough to cover the scheme’s liabilities. Deficits are also sometimes referred to as shortfalls.

A form of protection from the Lifetime Allowance charge. Members must have registered with HMRC by 5 April 2009 for the protection to apply. You must tell us if this protection applies to you.

For more information, visit the HMRC website: www.hmrc.gov.uk

A form of protection from the Lifetime Allowance (LTA) charge. Members must have registered with HMRC by 6 April 2012 for Fixed Protection 2012 (FP12) to apply; by 6 April 2014 for Fixed Protection 2014 (FP14) to apply; or by 5 April 2016 for Fixed Protection 2016 (FP16) to apply. FP12 provides members with a personal LTA of £1.8m; FP14 provides a personal LTA of £1.5m; FP16 provides members with a personal LTA of £1.25m. Fixed protection can be lost if certain conditions are broken.

For more detailed information visit: www.hmrc.gov.uk

A form of protection from the Lifetime Allowance charge. Members must have registered with HMRC before 6 April 2017 for Individual Protection 2014 to apply. Members who expected their benefits at retirement to be more than £1.25m could apply for the value of their pension benefits at 5 April 2014 to be protected up to a maximum value of £1.5m. Members with Primary Protection could not apply.

Detailed guidance about IP14 is available on the HMRC website: visit www.gov.uk

From April 2016, individuals who expected their benefits at retirement to be more than £1m could apply to protect the value of their pension benefits at 5 April 2016 up to £1.25m. For more details see www.hmrc.gov.uk/pensionschemes/pension-savings-la.htm.

It was the combined value of all pension and lump sum entitlements from all UK registered pension arrangements people belonged to, and had to be compared against the LTA set for the year you decided to draw your benefits.

Until 5 April 2023, a Lifetime Allowance tax charge was due on any pension benefits above the LTA. From 6 April 2023, the requirement to pay this tax charge was removed by the Government.

The value of your British Airways pension benefits to be compared against your LTA. This is worked out as 20 times your annual rate of pension, e.g. 20 x £6,000 p.a. = £120,000

Or, if you take a lump sum, the LTA value would be the cash value of your lump sum plus 20 times your remaining annual pension:

lump sum of £20,000 plus 20 x £4,200 p.a. = £104,000.

If, when drawing your BA pension, you have other pensions already in payment, the percentage of LTA used up by those pensions must also be taken into account. Where payment of any other pensions began before 6 April 2006, the value would be worked out as 25 times the annual rate of pension in payment at the date you draw your BA pension.

Before the LTA tax charge was removed in April 2023, if the total value of all your earned pension benefits exceeded your LTA at retirement, any benefits in excess of the LTA were subject to a Lifetime Allowance charge, which was deducted from your pension benefits and paid directly to HMRC.

Four types of protection existed, Primary Protection, Enhanced Protection, Fixed Protection (2012, 2014 and 2016), and Individual Protection (2014 and 2016).

The requirement to pay a Lifetime Allowance tax charge on any benefits that exceed a protected LTA was removed by the Government from 6 April 2023.

A new, single-tier State Pension replaced the Basic State Pension and earnings related State Pensions for men born after 6 April 1951 and women born after 6 April 1953 and who will therefore have reached State Pension Age on or after 6 April 2016.

To get any new State Pension, you will usually need at least 10 qualifying years (years in which National Insurance (NI) contributions have been paid or NI credits received), and for the full amount you need to have 35 qualifying years.

Visit the Government website www.gov.uk/state-pension to learn more about the State Pension.

As NAPS was contracted-out of the State earnings related pension arrangements, a deduction is made for periods of contracted-out service. The adjustments to the State Pension are complicated and vary for each member.

Your starting amount will be the higher of:

1. your State Pension built up under the old system (up to April 2016) (Basic State Pension plus any State Earnings Related Pension (SERPS) or State Second Pension you built up whilst not a member of NAPS and paying National Insurance contributions) or;
2. the new State Pension for qualifying years to April 2016 adjusted for past contracted-out service.

Individuals still have the opportunity to build up new State Pension for service from April 2016 if their State Pension at April 2016 was less than the full new State Pension. You can get a State Pension forecast at www.gov.uk/check-state-pension.

This is the age (set by the Scheme) at which your pension payments would normally start.

At the date of your death this is someone who, in the opinion of the Trustee, is either:

• living with you in a relationship resembling marriage and with whom you are financially inter-dependent – such as a common-law spouse or partner; or
• someone who is financially dependent upon you to a substantial extent for the everyday necessities of life. There are special eligibility conditions for a child of a deceased member who is over age 23.

See also Surviving Dependant.

The total of the elements of your pay (or notional elements of your pay) designated as pensionable by British Airways.

For most NAPS flying staff, Pensionable Pay was increased by 18.75% for service after 1 April 2007 as part of the overall NAPS changes implemented in April 2007.

For NAPS, there were two Pensionable Pay types — NAPS 1 and NAPS 2.

BAMPS used NAPS 1.

Pensionable Service is the period you have been a member of the Scheme for which contributions have been paid. This includes any time transferred from another Scheme and adjustments for periods of part time employment or changes in occupational

Introduced on 1 April 2007, Plan 60 allowed NAPS members to build up pension benefits payable at a Normal Retirement Age of 60. The standard Contribution rate was 8.50%. Members had options to increase the Build-up rate to 1/67 or 1/60 by paying extra contributions on top of the basic contribution rate.

Option 55 members paid extra pension contributions on top of the standard Plan 60 rates to enable them to build up a pension to age 55 with no actuarial reduction for early payment from age 55.

Pension Wise is a Government service from MoneyHelper that offers free, impartial pensions guidance about defined contribution pension options (including AVCs).

An appointment with Pension Wise is free and will help you understand what your overall financial situation will be when you retire.

A form of protection from the Lifetime Allowance charge. Available for members whose pension benefits value exceeded £1.5m at 6 April 2006. Members had to register with HMRC by 5 April 2009 for this form of protection to apply. Members who registered for Primary Protection are entitled to a personal Lifetime Allowance (PLTA) which is greater than the standard LTA.

For more information, visit the HMRC website: www.hmrc.gov.uk.

An investment strategy and practice which considers both financial returns and environmental, social and governance (ESG) factors.

For service from 01 April 2007 Retiring Pay was calculated as the average of the best two years of Pensionable Pay in the five years before you left the Scheme. A 'year' for Retiring Pay purposes was any consecutive period of 365 days but one year did not need to be consecutive with another.

For service up to 31 March 2007, Retiring Pay was worked out as above but calculated at the earlier of your old Normal Retirement Age (55 - flying staff, 60 - ground staff) or the date you left. If you were already over your old Normal Retirement Age on 31 March 2007, your Retiring Pay in respect of the pension earned before 31 March 2007 was calculated at 31 March 2007.

These are investments which aim to increase the value of a pension scheme’s investments (capital growth) with a lower income stream and typically produce higher returns over the long term, but with a higher level of investment risk.