A Guaranteed Minimum Pension (GMP) equalisation update
You may have heard about Guaranteed Minimum Pension (GMP) equalisation from other pension providers or in news articles. The background is that a landmark pensions case has decided that pension benefits should be adjusted for historical differences in how men and women’s pensions were built up under legislation.
Navigating a complex process
To complete this work, we will need to compare each member’s benefits with those that they would receive if they were the opposite sex, on a year-by-year basis.
Tackling this complex work will involve making changes to our administration system which is a challenge a lot of schemes are facing. We're implementing new administration software which will perform these calculations as well as improving a number of other administrative functions but this will take time.
What does this mean for me?
There’s nothing you need to do while we carry out this work. Once we have completed the necessary calculations, we’ll contact you if anything is due to you. Any uplift payments will be modest. No pensions will be reduced, and we expect that most members are already receiving the correct amount.
The new GMP equalisation project will take some time, so we’ll provide a progress update in the Source next year.
GMP jargon buster
GMP is part of the pension built up between 1990 and 1997 in schemes that were contracted out of the State pension. The amount of GMP and the way it increases over time is set by law.
