Guaranteed Minimum Pension (GMP)
Contracted out DB Scheme must provide GMP for service between 06/04/1978 – 05/04/1997
Provide broadly same benefits as if remained in SERPS
Contracting out has been abolished since 6th April 2016
Statutory escalation of benefits in payment: member reached SPA before 6 April 2016
CPI is calculated in the September of the previous year, ie the 2018 increase is based on September 2017.
For those members reaching SPA on or after 6 April 2016, they are entitled to new single-tier State pension.
The member’s foundation amount needs to be calculated to make sure they would be no worse off.
For those contracted out prior to this date – a deduction called the ‘rebate derived amount’ will be applied
For those reaching SPA on or after 6 April statutory escalation of benefits is:
