Yes indeed (as acknowledged in the NAO report linked in my previous)

13 The impact of new state pension reforms on people with Guaranteed Minimum Pensions will vary widely. The type of person who will do comparatively worse under the reforms is someone who has spent long periods in a contracted-out pension scheme and is close to retirement on 6 April 2016, so has little time to build up additional entitlement to new state pension. The Department estimates that 180,000 people who will reach state pension age in 2016-17 will have Guaranteed Minimum Pensions from before 1988. The amount by which people will be affected depends on their specific employment history. The Department’s modelling forecasts that 50,000 of these people will be worse off in 2017-18 as a result of the introduction of new state pension (paragraphs 3.13 to 3.17).

Yes.

Yes.......

Most of these people wouldn't have received it for a while anyway because their revalued GMP at GMP age was higher than the equivalent revalued SERPS...

The people who would be affected in this way would be those whose pensions had been deferred and subject to "Fixed Rate Revaluation".

See PDF linked here
https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN02674

Yes. And while BT (getting back to the OP) doesn't, it has a fully public sector-style treatment of GMP for the majority of its membership (sections A and B), including a mirroring of the 'temporary' arrangement for individuals who are currently reaching SPA (this is a consequence of the rules for sections A and B saying pension increases mirror the civil service scheme).

Is the OP in section C I wonder...?

He left BT back in 1988 and later transferred his deferred BT pension into a S32.

Doh, yes. So he lost the mirroring of PCSPS increases...?

Indeed - transferring out may have been even unwiser than he supposed.

“

Anyway, we are where we are now. The pension fund, instead of paving my driveway with gold, spectacularly failed to accumulate anywhere enough to even provide a pension like the one it replaced. However, they had to provide a guaranteed minimum (GMP) which, I understand, is roughly equivalent to the original BT one. This is where the confusion begins…


The GMP is as follows:


Benefits Annual
Accrued Pension Escalation

Pre 6/4/88 £5058 Level
Post 6/4/88 £656 RIP cap 3%

”

He also had a relatively high COPE

High Dairy Queen,

I thought I would keep you up to-date regarding GMP indexation . Two friends of mine have had a case with the Parliamentary Ombudsman against the DWP regarding not been told by them that they would no longer receive GMP indexation via the state pension calculation as promised in all DWP booklets and all occupational pension scheme booklets. They won their cases and on the 29 October the Parliamentary Ombudsman said they DWP were guilty of maladministration. This has taken four years to come to this conclusion.

Attached are some paragraphs from their report.

65. ln order to remedy the injustice we have identified that resulted from the DWPis
maladministration, we recommend that the DWP should:

a) Within one month of this report, apologise to Mr ? for the injustice
(frustration and inconvenience) their actions have caused him;
b) Within one month of this report the DWP shoutd pay Mr K !!!!in
recognition of the injustice suffered;
c) Within three months of this report, review and report back on to us on the
learning from this investigation, including action being taken to ensure
that affected individuals receive appropriate communication from the
DWP about their state pensions. ln particular, the DWP should ensure that
their literature clearly and appropriately references that some
individuals, who have large GMPs and reach State Pension Age in the early
years of the new State Pension, may be negatively affected by the
changes. The DWP should advise individuals to check their circumstances,
and should provide instructions for how to do this;
d) Within three months of this report, review and report back about how
other individuals who believe they have suffered an injustice as a resut of
the maladministration we have found can raise any concerns with the DWP
and have them considered; and

e) Consider, and report back to us, whether this report and their response to
our recommendations should be communicated to other interested parties
such as the Chair of the Work and Pensions Select Committee.

Notice the Ombudsman only said recommends the DWP should do it an did not say they had to.

My friends are happy that the DWP are now guilty of maladministration but are not happy with the rest of the report because the Ombudsman has refused to look into why it happened or find out what Parliament were told about the loss of GMP paid via the state pension. From our researches we have not been able to find anything so are now wondering if the law was actually changed and if so have the DWP stopped doing the GMP calculation without the authority of Parliament .

Possibly some of you can help us and tell me if you ever found any information about loss of GMP indexation being mentioned in DWP/Government publications before the New State Pension became law in May 2014.

High Dairy Queen,

I thought I would keep you up to-date regarding GMP indexation . Two friends of mine have had a case with the Parliamentary Ombudsman against the DWP regarding not been told by them that they would no longer receive GMP indexation via the state pension calculation as promised in all DWP booklets and all occupational pension scheme booklets. They won their cases and on the 29 October the Parliamentary Ombudsman said they DWP were guilty of maladministration. This has taken four years to come to this conclusion.

Attached are some paragraphs from their report.

65. ln order to remedy the injustice we have identified that resulted from the DWPis
maladministration, we recommend that the DWP should:

a) Within one month of this report, apologise to Mr ? for the injustice
(frustration and inconvenience) their actions have caused him;
b) Within one month of this report the DWP shoutd pay Mr K !!!!in
recognition of the injustice suffered;
c) Within three months of this report, review and report back on to us on the
learning from this investigation, including action being taken to ensure
that affected individuals receive appropriate communication from the
DWP about their state pensions. ln particular, the DWP should ensure that
their literature clearly and appropriately references that some
individuals, who have large GMPs and reach State Pension Age in the early
years of the new State Pension, may be negatively affected by the
changes. The DWP should advise individuals to check their circumstances,
and should provide instructions for how to do this;
d) Within three months of this report, review and report back about how
other individuals who believe they have suffered an injustice as a resut of
the maladministration we have found can raise any concerns with the DWP
and have them considered; and

e) Consider, and report back to us, whether this report and their response to
our recommendations should be communicated to other interested parties
such as the Chair of the Work and Pensions Select Committee.

Notice the Ombudsman only said recommends the DWP should do it an did not say they had to.

My friends are happy that the DWP are now guilty of maladministration but are not happy with the rest of the report because the Ombudsman has refused to look into why it happened or find out what Parliament were told about the loss of GMP paid via the state pension. From our researches we have not been able to find anything so are now wondering if the law was actually changed and if so have the DWP stopped doing the GMP calculation without the authority of Parliament .

Possibly some of you can help us and tell me if you ever found any information about loss of GMP indexation being mentioned in DWP/Government publications before the New State Pension became law in May 2014.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/482871/impact-of-new-state-pension.pdf

Have you seen the NAO report linked in post 9 above? It uses 2015-16 BSP figures in illustrations - it is quite obvious that DWP were aware of the GMP effect earlier than this and also clear that communication to those affected was less than adequate.

This report reviews the Department’s approach to assessing and communicating the changes to Guaranteed Minimum Pensions resulting from the introduction of the new state pension.

4.8 In March 2015 we wrote to the Department to highlight a lack of publicly available information and guidance on the scenarios under which pensioners might receive less pension under the new state pension. We found that it had not communicated the scenarios in which people could be worse off. We recommended that the Department review its communication strategy and distribute clear guidance, including scenarios relating to the end of contracting out and the indexation of Guaranteed Minimum Pensions’ increases.

I recall old threads on which xylophone (the forum's GMP maestro) posted several references to GMP indexation from government papers discussing the nSP. The government was certainly aware. Steve Webb (Pensions Minister in Cameron's government) was definitely aware.

The changes to GMP indexation were not widely publicised and, tbh, GMP was (and is) very difficult to explain in the kind of media soundbites that most of us understand. Of course, it was also very convenient to marginalise the government's welching on their undertaking to those who had been contracted-out. Their (new) position being that they were not liable, and never had been, for contracted-out amounts. This despite (as xylophone demonstrated) official documents which proved otherwise. Indeed, the government had always provided the top-up indexation on GMP until the intro of the nSP. It had never been the contracted-out scheme's responsibility but the government adopted a new and misleading narrative that suggested that it (the government) had never undertaken this responsibility.

I am not surprised that the Ombudsman found in favour of your friend. However, I also think it highly unlikely that it will make any difference. The government has now washed its hands of contracting-out and its legacy, other than the nominal COPE amount applied to the SP of those in transition. There is no way that any compensation will be forthcoming, nor will any reintroduction of GMP indexation.

Some people were winners under the nSP rules, some were losers. Some will benefit from the transition rules and others won't. Nobody can amend their employment history of decades ago.
One thing to bear in mind is that (for some GMP periods of employment) the revaluation rates were very generous as a prolonged low inflation rate was not foreseen when they were set. For some people, those generous revaluation rates in deferment will go a a long way to offset the lack of indexation once the GMP is in payment.

Very true - and this does come across in the very detailed and thorough NAO report.

Thanks everybody – sadly, for me the most important thing you’re teaching me is that I haven't a hope in hell of understanding any of it.



Also, whatever the rights and wrongs, I’m stuck with it all now.
Fortunately, I live fairly frugally!


Best wishes
Roger

If you study the paragraphs at the end you will see that that the DWP are supposed to contact everyone affected to tell them about non payment of GMP indexation including any of you who are affected. This does not affect me as I started receiving my state pension in 2005.

When I mentioned had anyone seen mention of GMP indexation not being paid I did not make myself clear, what I was asking was had anyone seen it mentioned in legislation that GMP indexation would not be paid. This would have had to have happened before it became law in May 2014 under the 2014 Pension Act.

Have any of you thought about that the law might not of actually been changed to do away with GMP indexation and that the DWP are not paying GMP indexation with the approval of Parliament and may be doing it illegally.
That is why I am asking if any of you seen non payment of GMP indexation actually mentioned in legislation not just articles in the press and reports by Natioal Audit Office, Treasury and Work and Pensions Committee which were all done after the 2014 Pension Act had become law in May 2014 .

I don't know if any of you are aware of the 2011 pension act which became law in November 2011 which very clearly explained that GMP indexation a person would receive after state pension age was to be consolidated into the starting pension so that the GMP calculation after a person reached state pension age would not have to be done. The bit about GMP indexation did not have a start date as it would be decided some time in the future.
Page 20 explains the old system for GMP indexation very well which for some reason the DWP now deny ever happened.

Then read pages 21 to 28 which explains consolidation of GMP indexation after state pension age.
As I said it did become law in November 2011 so why was it not used in the 2014 pension act/

https://webarchive.nationalarchives.gov.uk/20110601202012/http://www.dwp.gov.uk/docs/pensions-bill-mpip.pdf


c) Within three months of this report, review and report back on to us on the
learning from this investigation, including action being taken to ensure
that affected individuals receive appropriate communication from the
DWP about their state pensions. ln particular, the DWP should ensure that
their literature clearly and appropriately references that some
individuals, who have large GMPs and reach State Pension Age in the early
years of the new State Pension, may be negatively affected by the
changes. The DWP should advise individuals to check their circumstances,
and should provide instructions for how to do this;
d) Within three months of this report, review and report back about how
other individuals who believe they have suffered an injustice as a resut of
the maladministration we have found can raise any concerns with the DWP
and have them considered;

Dairy Queen.

Some people were winners under the nSP rules, some were losers. Some will benefit from the transition rules and others won't.

Nearly all public sector because their occupational pensions have been made to taker over the GMP indexation previously paid via the state pension

Not seen a reduction in occupational pension because of employers NI rebate like most people in the private sector have,

Possibly also being able to burn off some of the period for being contracted out by earning extra state pension. Most probably less than 1000,000 people in the private sector in final salary schemes open to future accrual as final salary.

Most probably over 10 million people who were contracted in prior to 6 April 2016 who had GMPs who are now accumulating at a lower rate than they did under the old system.

See article done by Institute of fiscal studies from which you will see for people who are contracted in low earners will receive about £42 pw less under the NSP and high earners about £57 pw less.

I don't think the DWP has explained to anyone who was contracted in how much less they will receive under NSP

Of those people who gain under NSP most probably 90% are in the public sector because they have not seen a reduction in their occupational pension like the private sector or loss of GMP indexation like the private sector.

A Single-Tier Pension: What Does It Really Mean? July 2013
https://www.ifs.org.uk/comms/r82.pdf

Page 50
• The relative advantage of the current system is also greater for those
expecting to contribute for more than 35 years. The maximum amount of
state pension income that someone in this cohort could receive under the
proposed system is £146.30 per week. This compares with a maximum of
£213.60 per week under the current rules for a high earner and £189.04 per
week for a low earner (both with 49 years of contributions).