A Guaranteed Minimum Pension (GMP) is the minimum amount of pension the Trustee must provide for a member who had built up pension before April 1997.

This was one of the conditions of all Scheme members being contracted-out of the Additional State Pension. Your GMP makes up part of your total annual pension amount, with the amount that’s left (in excess of your GMP) representing your Scheme Pension.

The State Pension used to be made up of two parts – the Basic State Pension and the Additional State Pension. From April 1978, some workplace pension schemes chose to ‘contract out’ of the Additional State Pension. The rules for contracting-out were very complex, but the general idea was that both employees and employers would pay a lower rate of National Insurance contributions. In exchange, employees would not build up an Additional State Pension and they would earn a minimum amount of pension in their workplace pension scheme instead. This was called the Guaranteed Minimum Pension (GMP).

The amount of GMP is broadly the same as the Additional State Pension that you would have received if you had not been contracted-out and had paid a higher rate of National Insurance contributions.

The rules for how GMP built up were based on the way the State Pension worked in the past, which was different for men and women. A legal ruling required the Scheme to check all members’ GMP benefits built up between 17 May 1990 and 5 April 1997. For this period, we have to check if men and women have been treated equally for the effects of GMP and if not adjust members’ benefits. For more information, visit the Equalising GMPs page