PS pension - Spouses and Children "clawback"?

[Protocol]

A colleague asks me for help, the scenario is as follows:

For six years at start of their career, they didn't pay pension conts, as had 2yr contracts, not permanent
The six years are pensionable, great
However, the 1.5% S+C contribution was not paid, and must be paid
HR say their are two options:
(1) pay at retirement, "clawback" out of pension lump sum, cost is 1% of pensionable salary for each year for which the Spouse & Childrens’ was not paid. This payment is called the ‘clawback’
(2) The ‘clawback’ can also be paid during your service (i.e. before retirement) by paying an extra 1.5% of pensionable salary for each year not paid.


Which seems better? (1) or (2)?

I am looking into this issue. The Pensions scheme booklet says the clawback is 1% of final salary for each missing year. So the cost at retirement seems to be (1% of final salary)(x6) = 6% of final salary

Or else it seems that HR suggest you can pay 1.5% * 6 = 9% of ongoing salary, although the Scheme Booklet doesn't mention this.

Surely you'd think it would be cheaper / lower rate now, and a higher rate in the future?

I wonder is the difference anything to do with tax relief?

 

[NoRegretsCoyote]

Surely you'd think it would be cheaper / lower rate now, and a higher rate in the future?

Not necessarily as basically every public servant will have a final value salary higher on retirement than today.

1% of final salary could be higher than 1.5% of today's salary.

Personally I would decide at retirement, you might not have a spouse or minor children then anyway seriously though, the cash is more likely to be useful to you when younger to do something like pay down a mortgage quicker.