Integration

Many defined benefit pension schemes are designed to take account of your state pension too.  This is called integration.

The most common form of integration is for the scheme to disregard an amount of your pay in the definition of pensionable pay.  This has the effect of reducing contributions and benefits.

Integration is unpopular with many members because it gives them less pension than they might expect to get.  

Integration can substantially reduce pension costs for the employer and, in contributory schemes, the employee. 

It is an important and controversial aspect of some defined benefit schemes because it disproportionately affects lower paid scheme members.