Some pensioners still owed up to £25,000 in GMP equalisation back payments – XPS

Some pension scheme members could still be waiting to receive up to £25,000 in guaranteed minimum pension (GMP) equalisation back payments, XPS Pensions Group analysis has revealed.

XPS estimated that between 1.25 million and 1.5 million may still be owed some form of back payment.

Its research found that the top 5 per cent of pensioners owed payments are owed an average of £10,000 each, with some potentially being owed up to £25,000.

The average age of those still entitled to money is 80-years old.

XPS noted that the impact of GMP equalisation on schemes and the cost to employers is “often relatively small”, with the impact on over half of schemes less than 1 per cent of overall liabilities.

However, XPS added that the back payments can represent a “significant amount” for the pensioners owed money.

“We are seeing a tendency to push GMP equalisation into the long grass, but this is untenable given the average age of those owed money, and the not insignificant amounts of money owed,” commented XPS Pensions GMP equalisation lead, Vicky Mullins.

“There is no reason why pension schemes cannot move forwards with GMP equalisation now. It is not as complicated as it first appears if you avoid getting bogged down in data.

“It is incredibly important that members receive the money they are entitled to, particularly at this difficult economic time where older pensioners may have significant need for income.”

GMPs were built up by members in occupational schemes, primarily in the 1980’s and 90’s, and a 2018 court judgment ruled that benefits earned needed to be amended to ensure that men and women are treated equally, with schemes and employers made responsible for redistributing funds.

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