Pension increases
At a glance
Your pension increases each year in retirement to help it to keep pace with increases in the cost of living. Different parts of your pension increase at different rates, as follows:
Part of your pension | Annual increase |
|---|---|
GMP* built up before 6 April 1988 | In line with the Retail Prices Index (RPI) up to 3% |
GMP* built up from 6 April 1998 | In line with the Consumer Prices Index (CPI) up to 3% |
Non-GMP pension built up before 6 April 1997 | In line with the Retail Prices Index (RPI) up to 3% |
Post 5 April 1997 pension | In line with the Retail Prices Index (RPI) up to 5% |
Post 1 April 2005 | In line with RPI up to 2.5% |
*You might have a Guaranteed Minimum Pension (GMP) element if you were a member of the Plan before 1997. Between 1978 and 1997, members of defined benefit pension schemes like the Plan were automatically removed from part of the State Pension, known as the State Earnings Related Pension Scheme (SERPS), which changed to the State Second Pension (S2P) after 2002. This is known as being ‘contracted out’. Members were guaranteed a minimum pension (the GMP), broadly equivalent to the amount they would have received if still in SERPS to ensure they did not lose out.