The High Court has recently decided a case to do with ‘Guaranteed Minimum Pensions’, (‘GMPs’).
The judgement affects the Plan because some of its members’ pensions include a GMP element. The judgement confirms that pension schemes will need to provide equal benefits for men and women for pensionable service between 17 May 1990 and 6 April 1997. This is despite the fact that GMP itself is calculated differently for men and women. This is known as equalising GMP.
The Trustee has been monitoring the court case and is now reviewing with its advisers the details of this judgement and the extent to which it may impact members’ pensions in the Plan.
Members may be affected by this decision if they accrued a GMP between 17 May 1990 and 6 April 1997. However, as the calculations for GMPs are very complicated it is unclear how long it will be before the Trustee can let members know if this impacts anyone and if they will see a change to their pension, but at the least it will be some months.
The potential impact that GMP equalisation may have on members benefits has not yet been determined. However, any members whose pensions are affected are unlikely to see a major change in their pension, and in all cases they will not see a reduction. The cost of any changes that may need to be made are unlikely to have a major impact on the financial health of the Plan.