This is an informal compilation of notes concerning retirement pensions as affected by a partial working life in France at the ILL, and the UK. The information is primarily offered as a guide; we cannot be held responsible for accidental inaccuracies or our own misunderstandings. We urge readers to send us comments and suggestions for improvements or clarification.

We were encouraged by the former ILL director Colin Carlile to publish the notes on the ILL website, to help past ILL employees and to gather greater feedback as an increasing number start to assess their possible pension situations.

April 2008

Ron Ghosh and Brian Donnelly,

• Pensions in France and the UK with Examples
• Introduction to French Pensions
• Summary of UK Social Security Benefits
• Retirement Age
• Retirement Lump Sum Payments
• Estimating final pensions
• CONTACTS for French Pensions
• Examples
• A. Examples of fully paid-up workers at/over 60
• B. Examples of incomplete contributions at 60
• Frequently asked questions
• Other useful references
• Appendix I - Table of Plafond du Securite Sociale - Tranche A
• Appendix II - Estimating the French state pension

Recent NEWS

The UK Government has announced pension reforms to take effect from April 2010. The most important for ex-pats is the abolition of a minimum of (about) 11 years contributions to qualify for any UK state pension. A full state pension will correspond to 30 years contributions (at present 40).

Most of this web page was written before the changes in pension laws in France were announced in 2003. The details are still being negotiated. We intend updating these notes and the Guide with newer information as this becomes available. Sections subject to modification due to the new laws are marked **.

RETIREMENT GUIDEBOOK

This guide** to assessment of pensions arising in France and the UK was completed by the Ernst and Young Actuariat, Paris, during the summer of 2003 and is available for past and present staff of the ILL. It contains a number of worked examples and offers authoritative guidance on estimating and obtaining pensions. Copies are available from R. Ghosh and B. Donnelly

Pensions comprise two parts: the French State Pension, paid by the Securite Sociale ("Secu"), and complementary pensions. At the ILL both employer and employee contribute to both. The complementary pension schemes are contributory; i.e. the pensions are paid out of current contributions rather than profits from investment of incoming money in established funds.

The French State Pension Scheme
The Secu pension is based on contributions from the employer and employee for a salary slice not exceeding Tranche A. This is known as the PSS, Plafond du Securite Sociale. In 2007 the level was 32814 Euros. This is modified each year as a function of indexes of general inflation and governmental generosity. A table is given in appendix I. The working life is now considered to be 160 full calendar quarters i.e. January-March, April-June, etc., known as trimestres. This includes trimestres worked anywhere within the EU. Working this full period gives rights to a Secu pension which depends on 10-25 best years of contributions. (See examples later)
Note: the UK definition is usually in terms of weeks of contributions which are rounded up into years; take care in performing the conversion to trimestres, which usually results in some significant reduction of the UK fraction! Rounding down to complete calendar quarters, presented here, would appear to be the worst-case scenario. A further complication is that the UK assesses contributions in terms of tax years starting in April. More recently we have noted that the trimestres of EU work outside France have been quite generously credited by the CRAM, perhaps because it leads to a lower fraction of the final pension which will be paid by France.

The Secu pension is managed by the CNAV which has local offices, the CRAM. If one retires in France, this office is finally responsible for calculating the number of trimestres one has contributed within the EU. Present practice suggests that the exact figures are not very predictable. For example, in one's first and final years in France additional trimestres may be attributed if Social Security payments exceed certain thresholds. In addition, conversion of UK weeks to trimestres by the CRAM remains worryingly unpredictable despite our analysis of an increasing number of known cases. Note, too, that overlapping French and UK periods are also eliminated. (This arises, for example on joining the ILL part way through the year, say September. The contribution made to the Secu may lead to the rights for 3 trimestres, but one has worked in the UK already for 3 trimestres, hence there is actually an overlap.

Complementary Pension Schemes - IPRIS and IRRAPRI
The ratio of contributions to pensioners in the complementary schemes is diminishing and, consequently, there is a tendency to reduce the pensions paid out to newly retired staff. As a belated recognition of the problems faced by the smaller complementary pension funds these have now been assembled under two organisations, ARRCO and AGIRC. At present the ILL pays into two, IPRIS from ARRCO and IRRAPRI from AGIRC. These are both members of a larger group of pension organisations, GROUPE APRI. The contributions from the employer and employee corresponding to the salary up to the top of the Tranche A are paid into IPRIS. For the remainder of the salary, judged up to the annual gross salary, Tranche B, there are contributions to IRRAPRI. (For stratospheric salaries there is a Tranche C!) For each, the contribution to the annual pension is the number of points multiplied by the current value of the point. The sums paid are however reduced by about 4% per missing year if one has not completed 160 EU trimestres.

IPRIS and IRRAPRI use the basis that the Secu pension has been paid in their assessment of rights to paying out their part of pensions.

Until very recent times when numerous new private pension schemes have become advertised, all French pensions have been paid from one or several of these complementary schemes. It is hence understandable that such standardisation has lead to little debate on optimisation of pensions, and that there is a strong link to the French state pension scheme.

Full details of these may be found at the Department for Work and Pensions (formerly DSS) website. In addition to pensions UK contributions give access to a number of additional benefits, which are often means tested, and are only available if one has been contributing in the last two years before retirement. A full working life consists of 49 years, though a full pension is granted after 44 years of contributions. A single person's full pension (2004) is about £80.

Until recent years it was mandatory to pay for the basic UK state pension when employed and usually a second component, an earnings related complementary pension. More recently it has been possible to opt out of the second. This change was in recognition that the private schemes were often advantageous, being based on with-profits investment.

If one is not in employment, or is employed outside the UK, it is possible to pay "Class 3" contributions which continue to build up the entitlement to a full pension after 44 contributing years. (Note the impending change to 30 years).

A full single person's pension (2006/7) is about £87 per week. Until recent years it was mandatory to pay for the basic UK state pension when employed and usually a second component, an earnings related complementary pension. More recently it has been possible to opt out of the second. This change was in recognition that the private schemes were often advantageous, being based on with-profits investment.

Voluntary contributions to the UK state pension

If one is not in employment, or is employed outside the UK, it is possible to pay Voluntary contributions which continue to build up the entitlement to a full pension after 44 contributing years. If the total number of years of contributions is less than one quarter of the years required for a full pension (i.e. eleven full years in the EU/EEA) then no pension is payable. Otherwise the pension is paid pro-rata at the age of 65 (for women born before 1950 the retirement age is 60, with a correspondingly shorter period for a full pension).

Class 2 contributions
A change in the law early this century made it possible to acquire recent past-years in the UK system at very interesting cost, much lower than the following Class 3 voluntary contributions. A typical cost is now £2 per week to maintain contributions. Some benefits (for example UK maternity payments) are reduced, but these are unlikely to be pertinent for ILL staff.

Class 3 contributions
Typical cost is about £300 per year. Whilst one is employed in France, the class 3 contributions cannot add extra qualifying years for EU years worked for the French calculations, but they can increase the value of the potential UK pension providing at least the minimum of eleven years contributions have been paid; (this limit is now being phased out). Note: it is only possible to acquire additional non-overlapping years of contributions if these are acquired immediately one arrives in France, when it is still possible to buy back-years, for example, corresponding to postgraduate education periods when no contributions are made in the UK.

The cost of maintaining voluntary contributions can be offset against French Income Tax, according to one correspondent, by citing this as provision for additional pensions.

Student credits

If one continues in full time education after the minimum school leaving age (15 or 16) then one is credited with weeks which qualify for pension rights. This terminates at the month of the eighteenth birthday.

Other UK State Pensions

In the early sixties the government recognised that private pensions provided by the employer were not well adapted to the increasing tendency of short term employment, especially in the early stages of careers. In 1961 they introduced the State Graduated Pension Scheme into which employees payed into for two years, after which they could then contract-out. This created the basis for an earnings related additional pension which could be continued on changing employment. It was typical for many companies to have more favourable pension schemes and opting out was a standard choice. This scheme was phased out in 1975, and was replaced by the similar SERPS, the State Earnings Related Pension scheme. While not clearly stated it would appear that this is paid in a similar fashion to the State Pension, and may require a minimum number of State Pension contributions to have been made to receive this additional part.

Occupational Pension Schemes

Governmental agencies usually have some form of contributory pension scheme to top-up the state pension. Private industry typically uses employers and employees contributions to pay into a pension fund. On leaving the UK such funds are frozen, yielding a pension at 65, or may be sold back at the time and hence cancelled. On changing jobs it is sometimes possible to continue with the same pension organisation (e.g. the Universities' USS system) otherwise it is necessary to deal with each component organisation separately. The age at which the pensions become payable thus depends markedly on the original contracts. Some pensions schemes yield regular monthly payments, others may simply provide a lump sum on retirement which is then used to buy an annuity.

In the UK the age of retirement to receive the UK state pension is 65 (or 60 for women born before 1950). In France the nominal age for retirement is also 65. It is possible to retire in France, i.e. request the full state pension, liquidation, from the age of 60 if one has worked the 160 trimestres. If one has not fulfilled the 160 trimestres it is still possible to retire between 60 and 65, but the Secu pension is reduced significantly, and so are the IPRIS and IRRAPRI pensions, depending on the shortfall in nominal EU years of work.

It is worth noting that French governmental employees, including postal workers, railway workers etc., have pensions directly paid by the government and are not in the schemes described above, and the retirement age is often 55 and sometimes lower. We can compare ourselves with others in the CNAV system where the retirement age is spread between 60 and 65. (Follow linked frames etudes...statistiques...attributions)

Early retirement

After reaching 60 the employee cannot be stopped from retiring. The employer can no longer insist that the employee takes up retirement even though he has worked for 160 trimestres.

The French Government supports three mechanisms for early retirement:

preretraite-licenciement (ASFNE)
The employee is sacked for economic reasons (declared redundant); he receives unemployment benefits, and is granted some extra trimestres if he has not yet attained the limit. The ASSEDIC unemployment insurance also maintains some contributions to IRRAPRI etc.

**preretraite progressive
From the age of 55 there is a transition from full to part-time working.

ARPE
Employees who have completed 160 quarters before 60 can yield their posts to young replacements.

The Convention d'Entreprise describes the calculation of the termination payments on retirement. The sum corresponds to a an additional single total monthly salary after 5 years activity at the ILL, two after ten years service.. etc., if the person decides voluntarily to retire after the age of 60. This sum is considered to be a part of the salary, and is consequently fully taxable.

**Changes in the law since 2003 has required that the ILL change its policy on insisting staff retire when 160 Secu quarters have been attained. One consequence is the reduction in the termination bonus if the employee continues to work having attained his 160 trimestres.

To give staff an idea of how much cash in hand they might have per month on retirement we have tried to estimate the contributions from the French and UK pension systems. Details of the calculation are somewhat messy in the case of the Secu. The current CNAV  website has interactive tools forshowingnthe known EU contributions and pension projections.  IPRIS and IRRAPRI pensions are based on having earned points of a defined value in FF. If the employee has not completed 160 trimestres working in the EU, the IPRIS and IRRAPRI pensions are docked by about 4% per missing year. If the employee has brought up 3 or more children the state pension is increased by 10%. For IPRIS and IRRAPRI an increase is already incorporated in the points attributed.

Payment of State pensions
If one works to the retirement age in the UK and in France then the government agency where one is living will negotiate payment of the state pension, contacting the other agencies involved. More likely one will retire first in France; it is then up to the individual to arrange liquidation with the local CRAM, this
also now possible on-line at the above CNAV  website. It is advisable to contact the CRAM up to 12 months before any intended retirement to allow time for due process to occur. Typically an important document to obtain is the form E205, which summarises state pension contribution periods, from each EU country where one has worked.

For the UK the address is:                 The local CRAM office:

Inland Revenue NI contributions Office	   CRAM RHONE-ALPES
International Services,			   35 rue Maurice Flandin
Newcastle upon Tyne			   69436 Lyon cedex 3
England NE98 1YX

General experience has shown the need to correct information received from Newcastle, and this can sometimes be a protracted operation. On attaining 65 the UK and French agencies, for example, will re-assess the final pension to be paid. Having returned to the UK the DWP will be responsible for assessing the final sum of the pensions.

If one lives outside the EU then the UK pension, once established, is not updated with inflation or other increases.

The Secu pension is based on 150 trimestres maximum contributions. In the case where 150 contributions have not been achieved by the age of 65, the person continues to work, and the pension is not liquidated immediately, then the net contributions are automatically augmented 2.5% per additional trimestre after the 65th birthday (with a maximum of 150 total).

Payment of Complementary Pensions
For residents retiring in France the last employer should be able to transmit the request for pensions to ARRCO and AGIRC, though each organisation can deal with individual requests. For those domiciled outside France ARRCO has a separate department:

CICAS, Service des residents hors de France,
44, rue du Louvre
75001, Paris, (tel 01-40-13-73-00)

If retirement takes place before the age of 65 then it is necessary to show that the Secu is providing the basic pension.

Income tax

All pensions are liable to be taxed, and 3.8% or so of IPRIS and IRRAPRI is likely to be removed automatically at source to pay for French CSG and CRDS taxes etc., even when the pension is paid to a person in the UK. This should be countered since the UK is then responsible for health care.

State Pension
The starting point for assessing French pension rights is obtaining a releve de carriere which summarises the periods of contributions.

To facilitate the work of the CRAM office you should provide your French Sociale Securite number and a list of French employers, their addresses, and your periods of employment. The CNAV now offers a password-protected internet service to check their data on you. The site is: https://www.retraite.cnav.fr

 Click on ENTREE
 Click on Preparer votre retraite (sidebar)
 Click on Votre releve de carriere : le demander 
 Click on Comment l'obtenir - en ligne en le visualisant
or 
login directly 

You will need to know your 15 digit French Social Securite number. Those with the older 13 digit numbers will have to write to the CRAM office at Lyon.

  	   	CRAM RHONE-ALPE
		35 rue Maurice Flandin
		69436 Lyon cedex 3

IPRIS
Requests for a releve de compte at IPRIS should be sent to

		IPRIS
		2, avenue du 8 Mai 1945
		95202 Sarcelles Cedex

IRRAPRI
Requests for a releve de compte at IRRAPRI should be sent to

		IRRAPRI - Services Administratifs
		146, rue Albert 1er
		41930 Blois Cedex 9

In both cases you should include a list of French employers, their addresses, your periods of employment and your French Social Securite number.

Standard documents on applying by mail to the CRAM offices for their judgement on one's working life indicate applying for this six months before the proposed date of retirement; recently the responses have been fairly prompt. Delays may add to the general unknowns for UK staff trying to determine their rights according to the French pension system.

A number of staff have offered information on their particular circumstances, and we have tried to estimate the various components of the pensions they might receive. We have considered two classes:
A) those who will have completed 160 quarters work at the age of 60
B) those who won't have completed 160 quarters work at the age of 60

A common feature is the inevitable period of delay before receiving the first payments from UK pension schemes at 65. When the UK pension becomes payable this should be notified to the French CNAV/CRAM. The French pension is then re-evaluated, and any increase rusulting will be paid from then.

At present the average of the last 25 years PSS is 28324 Euros, which would lead to a full French state pension of 1106 Euros per month if the full payment has been made throughout the 25 years (i.e. salary level has always been above the tranche A)

The examples shown below has been approximately updated to 2007 levels. They serve principally to show the major components of the final pensions.

Example A1

At age 60, 27 years French service, 160+ EU trimestres contributions.

                    receive per month
French state pension       746 Euros 
IPRIS                      539 Euros  
IRRAPRI                    634 Euros
               total      1919 Euros

As fraction of final net salary:  79%

Having maintained voluntary payments to the UK system for 29 years A1 will have contributions needed for a UK state pension. This will yield a partial UK state pension at 65, about

£340 pounds per month

Example A2

At age 63, 32 years French service, 160 EU trimestres contributions

                   receive per month
French state pension       912 Euros 
IPRIS                      633 Euros  
IRRAPRI                   2417 Euros
               total      3962 Euros

As fraction of final net salary:  55%

With 13 years contributions to the UK pension system, at 65 this will yield about £157 per month

Example B1

At age 60, 25 years service at ILL, 140 EU trimestres contributions.

                    receive per month
French state pension       399 Euros  (including+10% for 3children,
                                      (halved for 5 missing
                                      (EU years
IPRIS                      367 Euros  (children+10%, missing years -20%)
IRRAPRI                   1306 Euros  (children+8%, missing years -20%)
               total      2132 Euros

As fraction of final net salary:  39% 

On reaching 65 additional pensions payable from within the UK:

Having maintained voluntary payments to the UK system B1 will have enough contributions needed for a full UK state pension. This will yield a full UK pension, about

£336 pounds per month

UK company pension (private pension deferred) 6 years contributions

£125 per month ----------------------------

Example B2

At age 60, 31 years service at ILL, 140 EU trimestres contributions.

                    receive per month
French state pension       449 Euros  (halved for 5 missing
                                      (EU years

IPRIS                      507 Euros  (missing years -20%)
IRRAPRI                   1890 Euros  (missing years -20%)
               total      2846 Euros

As fraction of final net salary:  45%

With only 4 years contributions to the UK state pension scheme this will not result (2007) in any pension benefits from the UK at all. If seven Class 2 contributions were made to bring this up to eleven years (costing about £110 per year) this would yield an additional monthly pension of £96 at 65. Under the new proposals from 2010 this minumum level is abolished but any back years acquired (subject to limits) will, in general,offer a good return for most people, especially being pro rata of thirty years maximum.

This last example is typical not only of UK scientists but other non-French Nationals who have made the ILL their principal career, and who now discover that they must continue to work to 65 to minimise the penalties built-in to the present French pension schemes.

This section contains questions primarily concerning problems which may arise on return to the UK, to which we are only now trying to find answers...

Will I be entitled to free UK-NHS Health care?
YES, if one is permanently resident in the UK.

Will I have to maintain a French bank account after return to the UK?
Current information  is that the CRAM, IPRIS and IRRAPRI all make prompt transfers to UK bank accounts without charge. The bank's details (IBAN and BIC) are required.

Can I get equivalent advantages, i.e. UK private health care, as offered to ILL retirees paying and staying in the ILL-Mutuelle?
NO

What unemployment benefits follow on in the UK from unemployment insurance in France?
For 12 weeks after return to the UK one can receive the French benefits. After this the UK benefits schemes take over.

Do I have to pay DSS insurance contributions on returning to the UK at 60?
From the age of 60 one is credited with contributions automatically from the tax year including the 60th birthday. One could continue to pay class 2 back-payments, to increase possible UK pensions. Some benefits may not be available if one has no recent payments.

Can I avoid the automatic deductions made to the French pensions for the French Health service when resident in the UK?
Alan Leadbetter has reported that in his case IRRAPRI has returned his CSG and CRDS contributions (which in the past had been subtracted at source). This is foreseen in the book by Lefebvre : Memento Pratique, when one is in another EU country where the state provides health care. He does note however that he has had to write to each pension organisation separately, and that obtaining any reply is a protracted process. If the DWP is responsible for initiating the pension evaluation then it will inform the French pension schemes that one is covered in the UK. It still may be necessary to remind IPRIS and IRRAPRI explicitly.

If I take early retirement under an FNE plan, am I free to return directly to the UK?
If this is taken up voluntarily, (i.e. below the age of 60) then you should remain in France, since you will be on the unemployment register, and must be available for work (this appears to be waived after reaching 58 or so). If over 60, when the employer declares redundancy, it is not clear that the ASSEDIC payments will continue more than 12 weeks after return to the UK.

If I take up retirement under the FNE will the ILL help me in future dealings with the French institutions?
Since one will have been formally sacked, the ILL can sever all contacts and ongoing responsibilities, even though the present Convention d'Entreprise suggests there might be a follow up of non-French retirees.

If I return to the UK at 60 and take up employment, can this increase my EU years for the French Pension?
Once the French pensions have been "liquidated" there can be no re-assessment, however under EU rules, when another EU pension kicks-in all state pension authorities involved must perform a re-assessment. (Note this only concerns the State pension components.)

Do the French and German scientists face the same problems of attaining their 160 EU trimestres?
In general, during graduate studies, French and German students are attributed "years" but with no other complementary contributions. This conforms to the French Secu notion of pensions, as much as the British pro-rata system matches the UK pension notions which would typically start at 25. In most cases French and German scientists at the ILL attain their 160 EU trimestres at about 60.

Is it possible to buy extra years in the French Secu system?
**laws enacted in 2003 suggest that years spent during education, where no contributions were made, could be "bought back" but only at high cost, proportional to the time since this period of non-contribution.

A very good general reference book on rights in France is:
Francis Lefebvre Memento Pratique, Vos droits, votre argent 2008
Editions Francis Lefebvre, 92532 Levallois-Perret
This is revised each year (September).

Rules on the calculation of pensions for EU workers can be found in:
Liaisons Sociales: 2/11/1994 No. 11798 and 28/02/1996 No. 12125

See booklet: NP46 A guide to Retirement Pensions (April 2005), Department of Work and Pensions

In 1988 the Service du Personnel produced a comprehensive (and colourful) document on pensions:

LE DEPART A LA RETRAITE DES AGENTS ILL which was summarised later in an English version by David Gray (1989). French Web-sites

French Web-sites
http://www.admifrance.gouv.fr
http://www.service-public.fr
http://www.premier-ministre.gouv.fr
The UK has a general website on pensions.
The the UK-DWP pension site is http://www.thepensionservice.gov.uk

The table below shows the PSS since 1974 with the ratio of the value of currency in that year to that in 2007. The last column is the effective Tranche A in current Euros.

   
   

Year   	PSS		revaluation 	after
        Tranche A	factor      	revaluation
			      		(2007)

1974	4244.18		5.024		21332.76
1975	5030.82		4.228		21270.31
1976	5780.87		3.595		20782.23
1977	6604.09		3.101		20279.28
1978	7317.55		2.790		20415.96
1979	8177.37		2.546		20819.58
1980	9165.23		2.239		20520.95
1981	10482.39	1.977		20723.68
1982	12503.87	1,766		22081.83
1983	13976.53	1.666		23284.90
1984	15183.92	1.579		23975.41
1985	16272.41	1.514		24636.43
1986	17104.78	1.481		25332.18
1987	17809.09	1.426		25395.76
1988	18348.76	1.393		25559.82
1989	19090.81	1.345		25687.90
1990	19976.92	1.307		26109.83
1991	21001.38	1.286		27007.77
1992	21970.95	1.247		27397.77
1993	22839.91	1.247		28481.37
1994	23342.99	1.224		28571.82
1995	23772.90	1.210		28765.21
1996	24577.83	1.181		29026.42
1997	25099.21	1.169		29340.98
1998	25776.08	1.155		29771.37
1999	26471.25	1.142		30230.17
2000	26892.01	1.137		30576.21
2001	27349.55	1.113		30440.05
2002	28224		1.089		30735.94
2003	29184		1.073		31314.43
2004	29712		1.056		31375.87
2005	30192		1.036		31278.91
2006	31068		1.018		31627.23
2007	32184		1.000		32184.00
2008   (33276)

This is dependent on the average salary in current francs of the best N years of work. If the salary exceeds the tranche A then this is taken as representing the salary that year. For this reason the tranche A in current FF is given in table I. The number of years N over which the average is made depends on age:

        Born	Number of years
	1940		17
	1941		18
	1942		19
	1943		20
	1944		21
	1945		22
	1946		23
	1947		24
	1948 and later  25

If one has been in France for less than the time proposed then the average of the salary during the actual period is used.

Two calculations are performed, firstly in the hypothetical case that all contributions during the working life were made to (1)the French system, (2)based on EU: this requires calculating La pension globale theorique , then a calculation on the fraction the French state system should pay on a pro-rata basis, la pension proratisee

Using the average salary, S, the rate, R% calculated based on age etc. (as per David Gray below) varying between 25 and 50%, the pension P is as follows for T trimestres:

P = S x R x T/150 (1) French system only

Here the rate R is the minimum, 25% because so few years have been contributed. T is the number of trimestres worked in France.
Calculate P1

(2) EU

a) La pension globale theorique

The rate is R = 50% for a full period of work. All EU trimestres are counted for T.
Calculate P2a

b)la pension proratisee This is the fraction of P2a obtained by multiplying P2a by the fraction of the French trimestres/Total trimestres
Calculate P2b

The sum which is paid is the larger of P1 and P2b.

Example - from example B1 above
The average salary S is in fact the average of tranche A over a 19 year period, since the actual salary has been above this level throughout the period. B1 has spent 108 trimestres in France.

Pension under the French system only
(1)

P1 = 167153 x 25/100 x 108/150 = 30087 FF

Pension as EU

(2a) La pension globale theorique

P2a = 167153 x 50/100 x 150/150 = 83576 FF

(2b)la pension proratisee

P2b = 83576 x 108/150 = 60175 FF

The pension based on the EU fractional calculation, P2b, is the larger, and this is what is paid.

-------------------------------------------------------------

Rate R% at which pension is paid...
.............according to David Gray, 1989.............

Anyone retiring before 65 with less than 160 quarters receives a pension at a rate R diminished by calculating:

either a)  number of quarters between retirement and 65
or     b)  number of quarters on retirement subtracted from 160

The smaller of a) or b) is then multiplied by 1.25%, say W%, and the annual pension above is calculated with R=50% replaced by (50-W)%. If this final figure is less than 25% the value of 25% is used.