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  • FIRST POST
    • DEFERREDPENS
    • By DEFERREDPENS 11th Mar 17, 12:54 PM
    • 5Posts
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    DEFERREDPENS
    Zero revaluation for Non-GMP?
    • #1
    • 11th Mar 17, 12:54 PM
    Zero revaluation for Non-GMP? 11th Mar 17 at 12:54 PM
    I have been advised by the pension trustees of a former employer that the non-GMP element of my employment, as it was before 1985, will not be increased at all since my leaving date in 1984.
    This doesn't seem fair - Is this correct?

    Thank you for any advice
Page 1
    • hugheskevi
    • By hugheskevi 11th Mar 17, 2:50 PM
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    hugheskevi
    • #2
    • 11th Mar 17, 2:50 PM
    • #2
    • 11th Mar 17, 2:50 PM
    I have been advised by the pension trustees of a former employer that the non-GMP element of my employment, as it was before 1985, will not be increased at all since my leaving date in 1984.
    Statutory revaluation of non-GMP deferred pensions was introduced by Social Security Act 1985 and applies to pension accrued after 1 January 1985, applying to those who left the scheme on or after 1 Janauary 1986. Prior to this, there is no statutory entitlement to revaluation of pension in excess of GMP.

    This doesn't seem fair
    You are being provided with the pension you were contractually promised, in accordance with legislation.

    Is this correct?
    Unless the Trust Deed promises more than statutory minimum (which is very unlikely given the information you have been provided with), yes.
    • xylophone
    • By xylophone 11th Mar 17, 3:32 PM
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    xylophone
    • #3
    • 11th Mar 17, 3:32 PM
    • #3
    • 11th Mar 17, 3:32 PM
    https://www.barnett-waddingham.co.uk/comment-insight/blog/2012/07/24/revaluation-for-early-leavers/
    • zagfles
    • By zagfles 11th Mar 17, 6:06 PM
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    zagfles
    • #4
    • 11th Mar 17, 6:06 PM
    • #4
    • 11th Mar 17, 6:06 PM
    On the positive side, if your scheme uses fixed revaluation for the GMP (most seem to) then you'll be getting 8.5% compound on the GMP, which is massively above inflation.
    • xylophone
    • By xylophone 11th Mar 17, 11:25 PM
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    xylophone
    • #5
    • 11th Mar 17, 11:25 PM
    • #5
    • 11th Mar 17, 11:25 PM
    But the company will have no obligation to increase the pre 88 GMP in payment.
    • brewerdave
    • By brewerdave 12th Mar 17, 11:19 AM
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    brewerdave
    • #6
    • 12th Mar 17, 11:19 AM
    • #6
    • 12th Mar 17, 11:19 AM
    But the company will have no obligation to increase the pre 88 GMP in payment.
    Originally posted by xylophone

    ....and in my experience most don't
    • xylophone
    • By xylophone 12th Mar 17, 11:22 AM
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    xylophone
    • #7
    • 12th Mar 17, 11:22 AM
    • #7
    • 12th Mar 17, 11:22 AM
    .
    ..and in my experience most don't
    Quite so, but for many of those in this situation, inflation protection is provided through the old State Pension - by no means all however, and of course with the New State Pension, the link is completely broken.
    • zagfles
    • By zagfles 12th Mar 17, 1:40 PM
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    • #8
    • 12th Mar 17, 1:40 PM
    • #8
    • 12th Mar 17, 1:40 PM
    .

    Quite so, but for many of those in this situation, inflation protection is provided through the old State Pension - by no means all however, and of course with the New State Pension, the link is completely broken.
    Originally posted by xylophone
    It's also broken in that revaluation of the GMP doesn't reduce the additional state pension, so again it's swings and roundabouts. Getting 8.5% revaluation for 30-35 years and then getting zero indexation in payment for 25 years or so could be a better deal than getting inflation revaluation & indexation in payment.
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