All about GMP
Welcome! Here you can find out more about Guaranteed Minimum Pension (GMP) and the work we are currently doing. These pages are relevant to members of the GSK Pension Fund, SmithKline Beecham Pension Plan and SmithKline Beecham Senior Executive Pension Plan (together, the ‘Plans’).
First of all, we would like to reassure you that there is nothing to worry about. In common with many other UK pension schemes, we have been reviewing our GMP records to make sure we have the right GMP amount on record for you.
If we haven’t, we will need to put that right – but this is unlikely to mean any big changes.
What is GMP?
Guaranteed Minimum Pension (GMP) is a part of pension many people built up between 6 April 1978 and 5 April 1997.
Watch our short video for an introduction.
Which pension plans are involved?
The GSK Pension Fund, SmithKline Beecham Pension Plan and SmithKline Beecham Senior Executive Pension Plan (together, the ‘Plans’) are all involved.
This is because they are defined benefit (DB) workplace pensions that were contracted out of the State Earnings Related Pension Scheme (SERPS) between 6 April 1978 and 5 April 1997.
The GSK Pension Scheme is not involved. This is because it was not contracted out of SERPS. If you only have benefits in the GSK Pension Scheme, this information is not relevant to you. The term ‘the Plans’ used on these pages does not include the GSK Pension Scheme.
How do I know if I have GMP?
If you are, or have been, entitled to a pension from any of the Plans – either because you are a member yourself, or you are the husband, wife or civil partner of a member who has since died – you are likely to have some GMP if the pension was earned during the period 6 April 1978 to 5 April 1997. If you are entitled to pension benefits because you are the child or other dependant of a member who has died, the GMP part of their pension, while they were receiving it, could have been underpaid or overpaid.
What is a DB pension scheme?
In a defined benefit (DB) pension scheme, you build up pension based on:
- the number of years you’re a member of the scheme and
- your salary – generally your salary close to the date you retire (or stop building up pension)
What is contracting out?
In a contracted-out pension scheme like our Plans, on the whole, you did not build up the part of the State Pension known as the State Earnings Related Pension Scheme or SERPS.
Instead, your pension scheme had to promise you an amount of pension intended to at least equal the SERPS part of the State Pension that you would have built up. Between 6 April 1978 and 5 April 1997, this pension was known as GMP. So, broadly speaking, your GMP should be the same as, or more than, the amount of State Pension you would have built up if you had not been contracted out.
Contracting out was common. It enabled employers and pension scheme members to pay a lower rate of National Insurance contributions. Our Plans, like most DB workplace pension schemes, were contracted out. The GSK Pension Fund stopped being contracted-out from 1 November 1996.
From 6 April 1997, the way in which schemes could contract-out changed. Broadly, schemes could contract-out if they provided a minimum amount of contributions or benefits.
Contracting out ended in 2016, when the two-part State Pension arrangement was replaced with the current single State Pension arrangement.
When do I get my GMP?
You’re entitled to start receiving your GMP from GMP Age. This is:
- age 60 if you are a woman
- age 65 if you are a man
These are the same as the State Pension Ages at the time GMP was building up, because GMP was designed to replace part of the State Pension.
Does GMP increase?
Yes – there are rules about increasing GMP before and after you retire, which depend on when you built it up. The increases may be different from those for your non-GMP pension.
The information above sets out the Trustee and GSK’s current approach to, and understanding of, GMP Equalisation. The Trustee and GSK each reserve all rights to change their approach in future. The information above does not confer any right to benefits.