Skip to main content
Service Service

Guaranteed Minimum Pensions

Guaranteed Minimum Pensions (GMPs) have been a long-standing complication of UK pensions. However, after a long and complex history, including in more recent years the abolition of contracting out and greater clarity on GMP equalisation, schemes are finally able to take the final steps in sorting out the GMP-related issues impacting member benefits.

Following the abolition of contracting out and the closure of HMRC’s GMP data service, many schemes have spent the last few years reconciling their GMP data with HMRC. With the deadline for HMRC to provide their final data cut having now passed, many schemes are in the process of closing down GMP reconciliation projects and moving on to the next phase of this data project, including recalculation.

And following years of legal uncertainty, October 2018 saw a landmark ruling in relation to GMP, with the Lloyds Judgment confirming that GMP equalisation is required and providing clarity on ways this could be achieved in practice. There are a number of possible methods that could be used to implement this, many of which have implications on scheme administration. The judgment did not provide all the answers and subsequently various guidance has been issued on data, methodology, tax issues and communications from HMRC, DWP and the cross industry GMP equalisation working group.

We believe that there is no one size fits all solution to GMP equalisation – it all depends on your scheme specific scenario. However, we can guide you through the whole GMP equalisation project, helping you identify the key factors that influence your strategy and condensing the guidance to bring out what is most relevant for you. We believe it is important to get GMP equalisation right first time, with robust governance and strong audit trails to avoid any unwanted future surprises, but to automate wherever possible to make the project as efficient as possible.

To help you understand how we can help you with every step of your GMP equalisation project, we have split the project into three key areas:

  • Preparation – getting your data ready for GMP equalisation work and planning your project early
  • Strategy and Delivery – Utilising technology to automate much of the technicalities, allowing you to focus on the big picture decisions
  • Implementation – the importance of working closely with your administrator and the importance of communicating with members

For more information on how we can help you get your GMP equalisation project moving forward using our robust, efficient solutions, please contact to your Willis Towers Watson consultant or our GMP equalisation specialist on the right.

Related Capabilities

Related tool

Pensions Briefing App

Free topical updates for pension scheme trustees and sponsors.

Contact Us