In line with the equalisation of pensions, the Pensions Act 2004 requires our compensation to be paid on a basis that is no more or less favourable to a woman or man, in respect of pensionable service on or after 17 May 1990.
In order to do this, our calculation of compensation has to take into account any differences in scheme benefits that are due to differences in the calculation of GMPs for men and women.
What do schemes in assessment need to do now?
You need to submit the GMP equalisation template to your Scheme Delivery Associate and follow the guidelines in our technical statement.
You’ll find information about both of these below.
We have produced a set of default early/late retirement factors – you can find further details of the default factors here.
GMP equalisation template
During an assessment period, when calculations are completed, trustees and/or advisers need to complete and submit the GMP equalisation and underpin calculation template to their Scheme Delivery Associate.
The template should be included in project plans and timing agreed with the Scheme Delivery Associate. And will need to be completed in addition to reflecting the impact of the GMP equalisation on the data interface layout (DIL).
The technical statement
The technical statement sets out how to adjust our compensation for equalisation for GMPs and the application of a statutory minimum underpin to our compensation in detail.
For ease of use we have split the statement into four separate chapters:
Part A: An overview of the process
Part B: Technical details
Part C: The Board's approach
Part D: Other useful information
Please note: We recommend Parts B, C and D are printed in colour.
Schemes with more than two new pension ages (NPAs)
The current version of the statement on equalisation for GMPs doesn’t include the methodology for equalising GMP for schemes that have more than two NPAs.
For schemes where this applies, you can use your own methodology, which must first have been agreed by the actuarial team. Alternatively, you can adopt the methods shown within the proformas here.
The proformas include examples for both active and deferred member cases. For pensioner members, the proformas in the statement can be used for each NPA and the results combined, as the statement describes.
If you have any questions please contact your appointed Scheme Delivery Associate.
Deferred members who only have GMP benefits
When equalising GMP, if there are any deferred members who have only GMP benefits – i.e. no excess benefits – please get in touch as we can provide proformas for these on request.