Guaranteed Minimum Pension (GMP)

GMP is the least amount you’ll get from your pension scheme by law if you worked between 6 April 1978 and 5 April 1997.

How GMP affects you

If you worked between 6 April 1978 and 5 April 1997, you would have been contracted out of the State Earnings Related Pension Scheme (SERPS). This includes the NHS Pension Scheme.

Your GMP is part of your pension from the date you're eligible to get your state retirement pension.

How much GMP you'll get

Your GMP amount is the same as what you would get if you had been in the State Earnings Related Pension Scheme (SERPS).

Your pension will:

usually be more than the guaranteed minimum
include your GMP amount, it is not an extra amount to be paid
increase up to the GMP amount if it's smaller than the GMP amount

The amount of GMP is different for each person. This depends on how much contracted out National Insurance contributions you've paid.

How your GMP is applied

Department for Work and Pensions (DWP) will write to you when you near state pension age. They will tell you how much your weekly GMP is and notify us.

We convert the weekly amount to an annual amount.

NHS pensions increase each year based on the Consumer Price Index (CPI). This increase is added at the beginning of April in the new tax year.

Read how pension increases and GMP are applied (PDF: 1.4MB).

How your GMP is calculated

If you need to know how your GMP is calculated, you can contact HMRC.

You can write to:

HMRC
NI Contributions Office
Retirement Pensions and Widows Benefits
BP4101
Benton Park View
Newcastle Upon Tyne
NE98 1ZZ

If you need to know how GMP affects your state pension, you can contact The Government Pensions Service by:

Telephone: 0800 731 0469.

GMP reconciliation and the end of contracting out

From 6 April 1978, the State retirement pension was made of the:

basic pension, which is often known as the ‘old age pension’
State Second Pension, which used to be the State Earnings Related Pension Scheme or SERPS

The basic pension was based on the member’s national insurance contributions record. It was paid by the Department of Work and Pensions (DWP).

The State Second Pension was an extra state pension based on a member’s National Insurance contributions. Public service pension schemes contracted their members out and paid it themselves. This meant members paid a lower rate of NI contributions.

Contracted out employment ended in April 2016. It was replaced by the single tier State Pension Scheme.

How GMP reconciliation could affect your pension

When contracting out ended on 5 April 2016, HMRC stopped tracking contracted out rights.

They issued data to pension schemes to compare HMRC’s records against the data in our scheme records. This included:

GMP amounts
contracted out start and end dates

This was to make sure it matched the data held by the National Insurance Contribution Office.

The comparison of data between HMRC and pension schemes is known as the GMP reconciliation. It covers the contracting out period from 6 April 1978 to 5 April 2016.

The reconciliation is now complete. HMRC provided up to date member data for schemes to check the pension benefits in payment are correct.

What happens if there's an under or over payment

If the scheme and National Insurance Contribution Office’s records show under or overpayments, they need to be corrected.

The reconciliation may show some records where the current GMP data we have is incorrect.

This may have resulted in the overpayment of some pensions. This means all or part of the GMP annual indexation was paid by NHS Pensions and the Department for Work and Pensions (DWP).

Overpayments will be written off. You do not need to repay any overpayments and your future pension payments will be corrected.

There may be cases where incorrect GMP data has led to an underpayment of pensions. If this happens, the affected pension will be corrected. We'll arrange for any money owed to be paid to the pensioner.

How you'll know if you're affected by GMP reconciliation

We'll contact members affected by the reconciliation.

Find more information about the reconciliation on our knowledge base.