Widow's entitlement to husband's GMP

Notepad_Phil

Okay I'm confused (not for the first time) with regard to a GMP pension matter that I hope I can get some assistance on.

I've always thought and pages such as https://www.barnett-waddingham.co.uk/comment-insight/blog/what-is-a-gmp/ had seemed to confirm that Mrs Notepad would receive a 50% entitlement to the GMP contained in my small DP pension on my death.

However I've now come across a statement on https://www.gov.uk/guidance/provide-a-pension-for-your-scheme-member#gmp-inheritance-provisions which says that a widow is only entitled to a half the GMP accrued or in payment at time of death providing she is able to claim one of the following state benefits Bereavement Allowance, Widowed Parent’s Allowance, Retirement Pension, based on her late husband’s National Insurance contributions (NICs), Retirement Pension, based on her own NICs but with underlying title to a Retirement Pension based on her late husband’s NICs, Bereavement Support Payment. - now I thought that under the new state pension she wouldn't have underlying title to a retirement pension based on my NICs and she can only claim for Bereavement Support Payment if I die before she reaches state pension age, so according to that page she wouldn't have any entitlement to any of my GMP once she gets to 67.

Now I'm sure I must be missing something, but not sure what that is.

Many thanks for any help on this.

DT2001

Have you looked at your particular scheme rules. I have just looked at the Barclays 1964 scheme and it states widow benefits as 50% of the pension paid at death but adjusted positively for any lump sum taken on commencement (which I could not because of the GMP element) and the reduction at SPA. It gives no further details but hope that it is 50% of each element (pre 88 GMP, post 88 GMP and excess) so the payments continue to increase a little.

Marcon

Notepad_Phil said:

Okay I'm confused (not for the first time) with regard to a GMP pension matter that I hope I can get some assistance on.

I've always thought and pages such as https://www.barnett-waddingham.co.uk/comment-insight/blog/what-is-a-gmp/ had seemed to confirm that Mrs Notepad would receive a 50% entitlement to the GMP contained in my small DP pension on my death.

However I've now come across a statement on https://www.gov.uk/guidance/provide-a-pension-for-your-scheme-member#gmp-inheritance-provisions which says that a widow is only entitled to a half the GMP accrued or in payment at time of death providing she is able to claim one of the following state benefits Bereavement Allowance, Widowed Parent’s Allowance, Retirement Pension, based on her late husband’s National Insurance contributions (NICs), Retirement Pension, based on her own NICs but with underlying title to a Retirement Pension based on her late husband’s NICs, Bereavement Support Payment. - now I thought that under the new state pension she wouldn't have underlying title to a retirement pension based on my NICs and she can only claim for Bereavement Support Payment if I die before she reaches state pension age, so according to that page she wouldn't have any entitlement to any of my GMP once she gets to 67.

Now I'm sure I must be missing something, but not sure what that is.

Many thanks for any help on this.

What you're missing is the appetite (join the rest of the world!) to read the rest of the information about the subject on https://www.gov.uk/guidance/provide-a-pension-for-your-scheme-member#gmp-inheritance-provisions

Had you resolutely ploughed on, that page sets out all the exceptions to the statement made earlier about only being entitled to half the GMP if she can claim etc etc. 

Virtually all contracted out salary related schemes adopted a 'model appendix' on GMPs, which provides for the 'lawful widow' (enjoyable mistyped in one deed I saw as 'awful widow'!) to receive a 50% GMP for the rest of her life. Check with your scheme and/or look at the benefit statement/booklet for the scheme.

TVAS

The awful widow. I can see that as a 1940s with Lana Turner in the starring role, having finished off husband number 5 who was played by James Mason.

Notepad_Phil

DT2001 said:

Have you looked at your particular scheme rules. I have just looked at the Barclays 1964 scheme and it states widow benefits as 50% of the pension paid at death but adjusted positively for any lump sum taken on commencement (which I could not because of the GMP element) and the reduction at SPA. It gives no further details but hope that it is 50% of each element (pre 88 GMP, post 88 GMP and excess) so the payments continue to increase a little.

Marcon said:

What you're missing is the appetite (join the rest of the world!) to read the rest of the information about the subject on https://www.gov.uk/guidance/provide-a-pension-for-your-scheme-member#gmp-inheritance-provisions

Had you resolutely ploughed on, that page sets out all the exceptions to the statement made earlier about only being entitled to half the GMP if she can claim etc etc. 

Virtually all contracted out salary related schemes adopted a 'model appendix' on GMPs, which provides for the 'lawful widow' (enjoyable mistyped in one deed I saw as 'awful widow'!) to receive a 50% GMP for the rest of her life. Check with your scheme and/or look at the benefit statement/booklet for the scheme.

Many thanks - I'll have another look through as all I saw from my last read to check on this (when I found the bit about the need to claim benefits) was the confirmation to me that she would receive 60% of the pension paid at death but with no details regarding the GMP position in a widows pension (which will likely be the only part of the pension which will receive any inflationary increases).

BearerOfLoss

I am concerned that my pre88 GMP will deprive my widow of her own service GMP pension, when she inherits part of a pre88 GMP pension from me. For example, my pre 97 "additional state pension figure" (ASP) is £80 per week, but my contracted out deduction is £145. So I receive no increases in my pre 88 GMP pension. My widow has a pre 97 ASP of £20, but a COD of £10, giving her a positive net pre 97 ASP of £10 per week. When she inherits part of my pre 88 GMP pension, it will eliminate her own pre 97 GMP pension, if even only part of my negative pre 97 ASP is merged with her positive pre 97 ASP.
Does anyone know if my widow's inherited negative ASP from me will be kept separate from her own service positive pre 97 ASP? 

xylophone

I think that you are going to have to consider the scheme pension and the state pension separately.

Your Scheme Pension Statement should show how it is split pre 88 GMP/post 88 GMP/excess.

Presumably should you pre-decease your wife, she will receive a widow's pension from the Scheme.

She will be entitled to half the GMP (which should increase in payment in the same way as yours did) and whatever the scheme rules say in respect of the excess.


From the information above, you (and your wife) reached State Pension Age pre 6/4/2016.

Your annual state pension letters show your individual pre 97 ASP amounts.

At some stage you had a deferred Scheme DB pension which included both pre 88 and post 88 GMP?

When the pension became deferred, the GMP revalued in deferment by Fixed Rate (rather than Full Rate) which explains why the COD is higher than the ASP.

Therefore you receive no pre 97 ASP with your state pension.

Have a look at this

https://forums.moneysavingexpert.com/discussion/comment/79022643/#Comment_79022643

How would your situation compare?

BearerOfLoss

Thanks xylophone. I have looked at your link, but my widow's situation will be different. My former employer's scheme rules say that she inherits 60% of my pension in the year of my death. What discretionary increases she gets from my former employer may depend on the scheme Trustees practice.
My question is whether DWP will try to take away her own service positive ASP, because I had a negative ASP?
Do you know what they have done to others in the same situation please?
Thanks

xylophone

For post 2016 state pensions there is no link between the two of you, they are individual to each of you. 

I have the impression that the OP and his wife are in receipt of pre 6/4/16 State Pensions as he does not refer to a COPE for him or for his wife - I did ask this in my post above and the OP has not said that this is not the case.

Have a look at the link in my previous  which covers a widow/late spouse in the pre NSP situation.

Perhaps the OP could clarify.

xylophone

You and your wife reached SPA pre 6/4/2016?

See below - does it help?



https://www.thisismoney.co.uk/money/pensions/article-4739846/Why-state-pension-reduced-husband-died.html

BearerOfLoss

Thanks again xylophone. Your link to thisismoney confirms my worst fear.
So now I can look to see what legislative authority, if any, there is for merging apples and pears?
The two entitlements (the widow's own service positive ASP and the deceased husband's negative pre-88) are fundamentally different entitlements and should be kept separate, unless there is the clearest legislative support for merger.
As the widow writing to Steve Webb indicated, she lost her spouse (and a huge chunk of his workplace pension).
It seems cruel to take away her own right ASP too.