GMPs were intended to closely match the Additional State Pension that was given up in exchange for the lower National Insurance contributions that were paid. The Additional State Pension calculation was different for men and women, therefore GMPs are not the same for men and women, most notably because they are paid from different ages.
Due to a court judgment in October 2018, GMPs now need to be treated equally for men and women. This may apply to members who built up benefits between May 1990 and April 1997. This includes GMPs transferred from one scheme into another. This process is known as GMP equalisation. GMP equalisation will also apply to a pension which is paid to a dependant of a member who has died.
GMP equalisation is something that all workplace pension schemes with GMP earned between May 1990 and April 1997 are having to work through. It is a complicated process, needing input from the scheme advisers to carry out the necessary calculations.
The Trustee’s are currently reviewing all pension benefits, both in payment and those yet to be paid, in relation to equalising the Notional GMPs under the Plan. They are working closely with their advisers to ensure that any necessary corrections to benefits are identified and applied. Once this process has been completed, they will write to affected members with further information.