Merchant Navy Officers Pension Fund



Some of the terms on this site have particular meanings and we have highlighted them in blue text. The definitions of these terms are shown below:

Additional one year’s credit
This benefit was introduced for members in 1991 following the change to Normal Pension Age (NPA) for men from 62 to 61. The benefit is payable to all male members who:

  • Reached age 61 between 1 January and 31 December 2000; and
  • Contributed at some time during the calendar year 1987

If you meet both the conditions above, but subsequently left service, this credit will still be paid in full when you reach NPA and will be added to the pension you have earned up to the date of leaving, increased as described in Deferred benefits.

Additional Voluntary Contributions (AVCs)
AVCs can be paid into a pension scheme to provide additional benefits in retirement. You can pay as much into your retirement pot as you want to, however, the HMRC does restrict the level of contributions where tax relief can be applied – see Annual Allowance below.

Annual Allowance
You do not pay income tax on the money you pay into the MNOPF. However, there is a limit on how much tax-free money you can pay into pensions in any one year. This limit is set by government each year and is called the Annual Allowance. There have been changes to the Annual Allowance limits. If you would like to find out whether the Annual Allowance affects you, please use the following link to the HMRC website:

Average Revalued Pensionable Salary (ARPS)
This is the figure which is used in the calculation of your DB pension and is the total of each year’s revalued pensionable salary, then averaged, from the year earned to the year of calculation.

Any child dependent on you for the ordinary necessities of life. This includes a child who is not your legitimate or legally adopted child only if that child is living with you at the date of your death.
In addition, the child must be:

  • Under the age of 18, or
  • Under the age of 23 and in full-time education or vocational training, or
  • Over the age of 18 but incapable of earning his or her own living due to permanent disability (the Trustee has absolute discretion in determining what constitutes permanent disability, and may also decide to pay less than the full child’s pension).

Deferred member
A member who is no longer regularly contributing to the MNOPF but who has an entitlement to benefits in the future. Since the closure of the MNOPF to future accrual on 31 March 2016, all members of the defined benefit, New Section, of the MNOPF are deferred members of the scheme.

Defined Benefit (DB) Scheme
A defined benefit pension scheme is one where the amount you are paid as a pension is based on how many years you have worked for your employer and the salary you have earned. The New Section of the MNOPF provides defined benefit pensions and, unlike defined contribution (DC) pensions, the amount you get at retirement is guaranteed.

Defined Contribution (DC) scheme
A defined contribution, or money purchase, pension scheme is a type of workplace pension. It is built up through your own contributions, those of your employer and tax relief from the Government. You can choose where you want to invest your savings.
Defined contribution schemes give you an accumulated sum when you come to retire, which you can use to secure a pension income through buying a product called an annuity, or opt for income drawdown, or alternatively take all your savings as cash. Whichever option you choose, you can also take some of the pot as a tax-free lump sum.
Unlike a defined benefit pension scheme where the amount of pension you receive is guaranteed, the level of benefits you will receive from a defined contribution pension will depend on the value of the underlying investments when you come to take your money out.

Someone who relies on another person to support them financially.

Ensign Retirement Plan (for the MNOPF)
The Ensign Retirement Plan (for the MNOPF) was the Money Purchase (MP), or defined contribution, section of the MNOPF, but separate from the Defined Benefit (DB) Section of the Fund. It was closed from 31 March 2018 and all member benefits were transferred to the Ensign Retirement Plan. The Ensign Retirement Plan was launched in 2015 and is a master trust created especially for employees in the maritime industry, giving members flexibility in how much to contribute, where to invest, and how and when to take benefits. Following a re-fresh of the brand, the Ensign Retirement Plan is now called Ensign.
Find out more about Ensign here.

Fund Year
For the MNOPF the Fund Year runs from 1 April to 31 March.

Guaranteed Minimum Pension (GMP)
If you were an active member and employed by a participating employer that was contracted out of the State Pension arrangements between 6 April 1978 and 5 April 1997, the MNOPF must provide a benefit that is broadly equivalent to the pension that would have been earned under the State Earnings Related Pension Scheme (SERPS).This is known as a Guaranteed Minimum Pension (GMP). The GMP forms part of the DB MNOPF pension and is not payable in addition. If you have not been contracted out whilst a member of the MNOPF you will not have any GMP.
From 6 April 1997, a new system of contracting out was introduced and no GMP is accumulated after this date although the amount earned up to 5 April 1997 continues to be increased in line with National Average Earnings until you leave service or retire.
A single tier State Pension was introduced by the Government on 6 April 2016, which as a result means that contracting out will end for all pension schemes. However, as the MNOPF closed to future accrual on 31 March 2016, this is the date (just seven days earlier) when contracting out will cease for the MNOPF.

GMP age
If you have contracted-out service in the New Section of the MNOPF prior to 6 April 1997, this is the earliest age at which the GMP comes into payment. This is currently age 65 for males and 60 for females.

Her Majesty’s Revenue & Customs. HMRC is responsible, among other things, for the collection of taxes (they were previously known as the Inland Revenue).

Lifetime Allowance
The Lifetime Allowance is the maximum value that the sum of all your retirement savings can be without getting taxed. If the total value of all your retirement pots, including your MNOPF pensions, is higher than the Lifetime Allowance, then you will be taxed on the amount above the Lifetime Allowance. More information can be found here.

Lower Earnings Limit (LEL)
The Lower Earnings Limit is the amount of earnings that allow an employee to qualify for certain state benefits, such as qualifying years for the State Pension, and is set each year by the Government. You can find out the current Lower Earnings Limit here.
If your earnings in any job are less than the LEL, then you will pay no National Insurance contributions and you will earn no National Insurance benefit rights.

National Insurance (NI) contributions
You pay National Insurance contributions on your salary or wage, commission, bonuses and overtime, as well as sick pay and maternity, paternity and adoption pay from an employer. NI is calculated on gross earnings (before tax or pension deductions) above the Lower Earnings Limit.

Money Purchase Section
From 1 April 2016, the MNOPF was made up of a Defined Benefit Section and a Money Purchase Section. All member benefits in the Money Purchase Section have been transferred to the Ensign Retirement Plan, and the Money Purchase Section has been wound up.

New Section
The defined benefit part of the MNOPF before July 2014 consisted of two sections – the Old Section and New Section. The New Section started receiving contributions on 6 April 1978 following the closure of the Old Section on 5 April 1978. Everyone who had been an active member of the old scheme automatically became a member of the New Section from 6 April 1978. Members whose service began prior to 6 April 1978 and continued after this date will therefore have benefits under both sections.
The New Section closed to future accrual on 31 March 2016. Active members in the New Section of the MNOPF were automatically enrolled in the defined contribution Ensign Retirement Plan (for the MNOPF) from 1 April 2016 until 31 March 2018 when the plan was closed and members’ benefits transferred to the Ensign Retirement Plan, which is now known as Ensign.

Normal Pension Age (NPA)
For the New Section of the MNOPF, this is the age at which you can start receiving your pension without any reduction for early payment.
For most members this is age 61.
Female members in service as at 1 January 1991 retain the option to retire at age 60 without any reduction. Men who were in service as at 1 January 1991 can opt to receive the benefits they have accrued from 17 May 1990 as if they were due at a NPA of 60.

Old Section
The MNOPF consisted of two defined benefit sections before July 2014 – the Old Section and New Section. The Old Section opened on 1 January 1938 and continued receiving contributions until 5 April 1978 when it was replaced by the New Section.
Old Section benefits are no longer provided from the MNOPF. These benefits are now provided by individual insurance policies from Rothesay Life and Legal & General. Dependant on your service in the MNOPF you may have a policy from either Rothesay Life or Legal & General or from both.

Pensionable Salary
Your salary in respect of any period of service before 1 October 2000, less 1.5x the Lower Earnings Limit (LEL).

Pension sharing order
Pension sharing is one of the options available on divorce or the dissolution of a civil partnership.
If you decide to opt for pension sharing on your divorce or dissolution of your civil partnership, the Court will issue a pension sharing order (PSO) which sets out how much of your pension schemes your ex-spouse or partner is entitled to receive. The amount is expressed as a percentage of the value(s) of the scheme(s) that are to be split. Similarly, the pension sharing order may set out how much of your ex-spouse’s or partner’s pension you will receive. The value is worked out the day before the pension sharing order comes into effect.

Post-2000 Pensionable Salary
Your salary in respect of any period of service on or after 1 October 2000 less 1x the Lower Earnings Limit.

Post-2000 Average Revalued Pensionable Salary (Post-2000 ARPS)
The total of each Post-2000 Pensionable Salary revalued from the year of earnings to the year of calculation (usually the year in which service ends – see Deferred benefits for more information), divided by the period of service falling on or after 1 October 2000.
For service after Normal Pension Age (NPA), this is the total of each Post-2000 Pensionable Salary falling on or after NPA revalued from the year of earnings to the year of calculation (usually the year in which service ends – see Deferred benefits for more information), divided by the period of service falling on or after NPA.

This is the pay received from your employer during a Fund Year while you have been a contributing member of the MNOPF. Certain items of pay are included or excluded from this definition and these are listed in full in the Trust Deed and Rules, under Schedule 1.
For the calculation of the death in service lump sum, this is the higher of your salary in either of the last two Fund Years or calendar years prior to your death, revalued in line with National Average Earnings up to the date of your death.

This is the period since April 1978 during which you have paid contributions to the New Section of the MNOPF. Service is calculated in years and completed months based on your contribution record.

The State Earnings Related Pension Scheme (SERPS) was a UK Government pension arrangement, to which employees and employers contributed between 6 April 1978 and 5 April 2002, when it was replaced by the State Second Pension.

State Pension
The State Pension is a regular payment from the Government you can receive when you reach State Pension age. The amount varies and is based on National Insurance contributions.

State Second Pension (S2P)
The State Second Pension (S2P) replaced the State Earnings Related Pensions Scheme (SERPS) from 6 April 2002. The State Second Pension was replaced in April 2016 by the new State Pension.

State Pension age
The earliest you can receive your State Pension. It is based on your date of birth and gender.
For men born before 6 December 1953 the State Pension age is 65.
For women born before 6 April 1950 the state pension age is 60.
After these dates, the State Pension age is higher. To calculate your State Pension age please visit the Government website: