Guest comment: Time to get ready for GMP equalisation

The cross-industry GMP Equalisation Working Group (GMPEWG) has recently published its Call to Action on addressing inequalities in Guaranteed Minimum Pensions (GMPs).

It follows last year’s High Court decision that schemes with GMPs accrued between 1990 and 1997 must equalise members’ benefits for the effects of GMP (GMP equalisation or GMP-E).

Whilst recognising that clarification on some points is still awaited, the group has identified areas, mainly administrative, that schemes are urged start working on now.

The Call to Action sets out key points for trustees and their advisers to consider, including the need for all stakeholders to work collaboratively to ensure a successful project and the likelihood of resource constraints within the industry, with many schemes looking to complete GMP equalisation within similar timescales.

The document then covers topics for which there are good reasons to act now and the Pasa guidance also includes a checklist for trustees.

SPP is represented on the GMPEWG and the separate HMRC working group.

The publication of the Call to Action is the first of many milestones that are expected to be reached this year in terms of helping pension schemes progress.

The GMP equalisation journey has already started.

It is now clear that benefits must be equalised for the effects of GMPs. Whilst there are still unanswered questions, now is the time to get ‘GMP equalisation ready’.

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