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>Archive</a><button class="mm-collapsed mm-toggler mm-toggler-link" aria-haspopup="true" aria-expanded="false" aria-label="Archive"></button><ul class="mm-collapse"><li class="metismenu-item item-226 level-2"><a href="/index.php/archive/covid-19-and-the-fps" >COVID-19 and the FPS </a></li></ul></li></ul> </div> </nav> </div> </header> <div class="site-grid"> <div class="container-banner full-width"> <div id="mod-custom91" class="mod-custom custom"> <p><img src="/images/banners/GAD.jpg" alt="GAD" width="950" /></p></div> </div> <div class="grid-child container-component"> <nav class="mod-breadcrumbs__wrapper" aria-label="Breadcrumbs"> <ol class="mod-breadcrumbs breadcrumb px-3 py-2"> <li class="mod-breadcrumbs__here float-start"> You are here:   </li> <li class="mod-breadcrumbs__item breadcrumb-item"><a href="/index.php" class="pathway"><span>Home</span></a></li><li class="mod-breadcrumbs__item breadcrumb-item"><a href="/index.php/gad-guidance" class="pathway"><span>GAD Guidance</span></a></li><li class="mod-breadcrumbs__item breadcrumb-item active"><span>GMP indexation</span></li> </ol> </nav> <div id="system-message-container" aria-live="polite"></div> <main> <div class="com-content-article item-page" itemscope itemtype="https://schema.org/Article"> <meta itemprop="inLanguage" content="en-GB"> <div class="page-header"> <h1 itemprop="headline"> GMP indexation </h1> </div> <div itemprop="articleBody" class="com-content-article__body"> <p> </p>  <p>On 6 April 2016, the UK government introduced the new State Pension which removed the mechanism that enabled public servants in "contracted-out" employment between 1978 and 1997 to have their GMP fully price protected.</p> <p>The government consulted between 28 November 2016 and 20 February 2017 on how GMP indexation and equalisation should be applied to public service schemes from 6 December 2018. An interim solution was introduced for the period 6 April 2016 to 5 December 2018 whereby public service schemes would pay the full indexation for members reaching State Pension age between these dates.</p> <p>The three options under consideration for implementation from 6 December 2018 were:</p> <ol> <li>Case by case – an annual comparison of what a member would receive under the old and new system, which would also include a further comparator to ensure equalisation.</li> <li>Full indexation – a continuation of the interim solution</li> <li>Conversion – Convert the accrued GMP into a scheme benefit</li> </ol> <p>The government considered the replies it received and issued a <a title="Government response to consultation" href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/675360/Indexation_and_equalisation_of_GMP_in_public_service_pension_schemes_government_response_web.pdf" target="_blank" rel="noopener noreferrer">formal response</a> to the consultation in January 2018. It was decided to extend the interim solution from 6 December 2018 to 5 April 2021 to allow further consideration of implementing GMP conversion as a longer-term solution. This ensured that public service pensioners had the GMPs they had earned in public service fully indexed by their public service pension scheme. The government committed to continuing to consult with departments and schemes to decide whether a suitable methodology and legislation can be developed to enable GMP conversion to take place in the future and take account of alternative solutions that may also address this issue.</p> <p><strong>Please see the <a title="GMP interim solution: Impact on calculations using actuarial factors" href="http://www.fpsboard.org/images/PDF/Bulletin5/Appendix4.pdf" target="_blank" rel="noopener noreferrer">note</a> from GAD setting out the impact of the extended interim arrangement for GMP indexation on the application of some of the Schemes’ actuarial factors. Essentially this is an extension of the instructions that were issued in 2016 when the initial interim GMP indexation solution was announced.</strong></p> <p>On 7 October 2020 the government published a consultation on <a title="HMT consultation - Public Service Pensions, Guaranteed Minimum Pension (GMP) indexation" href="https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/924807/02.10.2020_GMP_indexation_consultation_final.pdf" target="_blank" rel="noopener noreferrer">Public Service Pensions, Guaranteed Minimum Pension (GMP) indexation</a>. The consultation sets out how the government proposes to ensure it continues to meet its past commitments to public service employees regarding the full indexation of public service pensions, including for any GMP element.</p> <p>The consultation will last for 12 weeks and closes on 30 December 2020.</p> <p>The consultation and supporting <a title="written ministerial statement HCWS495 7 October 2020" href="https://questions-statements.parliament.uk/written-statements/detail/2020-10-07/hcws495" target="_blank" rel="noopener noreferrer">written ministerial statement</a> can be found on the new <a title="consultations page" href="/index.php/legal-landscape/consultations" target="_blank" rel="noopener noreferrer">consultations page</a> of the Regulations and Guidance website.</p> </div> </div> </main> </div> </div> <footer class="container-footer footer full-width"> <div class="grid-child"> <div id="mod-custom138" class="mod-custom custom"> <p>© 2023 Firefighters' Pension Schemes Regulations and Guidance</p> <p><a href="https://www.webdigi.co.uk">Web development</a> by Webdigi</p></div> <div id="mod-custom139" class="mod-custom custom"> <p class="pull-right" style="clear: both;"><a style="clear: both;" href="/index.php/accessibility-statement">Accessibility Statement</a></p></div> </div> </footer> <a href="#top" id="back-top" class="back-to-top-link" aria-label="Back to Top"> <span class="icon-arrow-up icon-fw" aria-hidden="true"></span> </a> </body> </html>