Survivor Spouse's Pension

User123450

Does an inherited Spouse's defined benefit pension include all elements of a late husband's pension?

 

My Dad's current pension value upon death was £10,XXX.

Pre 97 Excess Pension £4,XXX.

GMP Earned Before 6 April 1988 £3,XXX.

GMP Earned After 5 April 1988 £2,XXX.

 

Upon death this year, the spouse's pension was calculated at around 50% of Pre/Post GMP elements. The Spouse's pension calculation did not include Pre 97 Excess Pension.

 

I am unsure why my mum does not receive 50% of the Pre 97 Excess Pension over GMP, is this not part of the calculation?

QrizB

User123450 said:

Does an inherited Spouse's defined benefit pension include all elements of a late husband's pension?

It depends on the rules of the scheme. What do the rules say?

Brie

Contact the bereavement team of the pension administrators.  They should be able to explain it to you.

xylophone

See

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

DRS1

xylophone said:

See

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

Isn't that post about the state pension?  The OP's question relates to an occupational pension scheme, doesn't it?

xylophone

Isn't that post about the state pension?  The OP's question relates to an occupational pension scheme, doesn't it?


I had thought there was a question of how the survivor's DB pension interacted with the survivor's state pension but I may have misunderstood.

DRS1

xylophone said:

Isn't that post about the state pension?  The OP's question relates to an occupational pension scheme, doesn't it?


I had thought there was a question of how the survivor's DB pension interacted with the survivor's state pension but I may have misunderstood.

I think the question is why didn't she get 50% of the excess over GMP.  The answer as mentioned above will lie in the scheme rules.

It is a mean scheme where the surviving spouse only gets 50% of the GMP but perhaps there is more to the story than we know.

xylophone

The widow has a statutory right to half her late husband's GMP.

The member of a scheme would also accrue benefits in excess of the GMP.

It is the case that a scheme has no obligation to provide any increase in payment on excess benefits accrued pre 5/4/97 but this does not explain why the widow would not receive some percentage of the non-increasing excess.

As above, perhaps scheme benefits for survivors are not very generous in this particular scheme.

rnj

Generally speaking, older schemes are less generous for the surviving spouse.

Marcon

User123450 said:

Does an inherited Spouse's defined benefit pension include all elements of a late husband's pension?

 

My Dad's current pension value upon death was £10,XXX.

Pre 97 Excess Pension £4,XXX.

GMP Earned Before 6 April 1988 £3,XXX.

GMP Earned After 5 April 1988 £2,XXX.

 

Upon death this year, the spouse's pension was calculated at around 50% of Pre/Post GMP elements. The Spouse's pension calculation did not include Pre 97 Excess Pension.

 

I am unsure why my mum does not receive 50% of the Pre 97 Excess Pension over GMP, is this not part of the calculation?

There is a statutory requirement to pay a pension relating to the GMP to a spouse, and as your mum and dad were clearly married at the time of his death, that would always be payable to her.

As others have said, anything further depends on the rules of the scheme - but it's quite unusual to have nothing more than this statutory minimum. The most common reasons for being quite so cheese paring are where the marriage took place very shortly before the death (a so-called 'death bed marriage - say 6 months to a year), or where a couple were 'judicially separated'. If their marriage did indeed occur shortly before his death, then it's possible the trustees have discretion over awarding anything in excess of a GMP-related pension, and they need to be aware of just how long-standing your parents' partnership was.

For your own peace of mind, and your mum's, it's worth going back to the scheme administrators and asking them why there is nothing payable in respect of the 'excess pension'. 

 

User123450

Married for over 40 years. It's a Rolls Royce pension.

"Your late Father retired in XX before his normal retirement date in the scheme which was age 65. At age 65 the Guaranteed Minimum Pension (GMP) is then implemented.

 

When a member retires before GMP payment age from deferred status, the pension put into payment reflects only the accrued GMP amount at date of leaving.  A GMP step-up is then provided at GMP payment age.

 

The statutory minimum spouse’s pension in respect of GMP for early retirements is that the pension payable is at least the widow(er)s GMP revalued to the date of death."

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I am still unsure why the 50% of the excess pension over GMP isn't paid.