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On Guernsey, you fund the cost of going

Since 1993, most Guernsey teachers have only been allowed to take early retirement on reduced terms, one of the options now being considered for all UK teachers. As a result, there has been a significant reduction in the numbers choosing to go early, with most teachers now staying on until they are 60.

"When we realised how much it was costing to give early retirement, we decided to introduce a self-funded scheme," said a spokesman for Guernsey's Education Council.

Unlike the system on the mainland, Guernsey's teachers' pension scheme is financed by a "real" fund, administered by the private sector. But the education authority decided that Pounds 70,000 or Pounds 80,000 to provide accrued benefits for a teacher of 50 taking early retirement was still too expensive.

Now, anyone retiring in their early fifties will face a drastic cut in their pension. A teacher retiring around their 50th birthday, for instance, will find that their pension and their lump sum are reduced by almost half, while someone who stays until 58 will lose just over 10 per cent of their pension and lump sum.

The aim is that the expense of early retirement is borne by the teacher, rather than the employer. Guernsey used the actuaries Bacon and Woodrow, experts in the Teachers' Superannuation Scheme, to work out the cost to the employer of early retirement and transfer the cost to the teacher.

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