GMP is the minimum amount the Scheme must pay for most pensionable service before 5 April 1997. This is because the Scheme contracted out of the Additional State Pension and instead is required to pay members a similar pension from the Scheme.
If you were employed by M&S and a member of the Scheme during this period, your GMP makes up part of your total annual pension amount.
The State Pension used to be made up of two parts – the Basic State Pension and the Additional State Pension.
From 6 April 1978, some workplace pension schemes were ‘contracted 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 up to 5 April 1997 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.
Firstly, the Trustee must always make sure that the total annual pension you receive when it’s in payment is at least equal to the amount of GMP you have earned.
Secondly, statutory increases set by the Government apply to GMPs (both before and once in payment), whereas the balance of your pension increases in line with the Scheme Rules.
This means that the increases applied to your pension, whether it’s in payment or not yet in payment, will be affected by how much of your total annual pension is GMP.
You’ll only be impacted if you have built up a GMP between 17 May 1990 and 5 April 1997.
We’ve completed the review for most members who are receiving a pension. If our review has found that your pension should be higher than the amount you’re receiving, we’ll increase your pension to the higher amount and, if applicable, make a one-off lump sum payment (with interest) to cover any past differences.
For some members, the increase and any one-off lump sum payment will be small. The majority of members are not due any increase at all because their pension is higher than it would be if they were the opposite sex.
We’ll also continue to check pensions each year to ensure that members with GMPs built up in the period continue to receive the right amounts.
If your pension is affected by other factors, such as transfers in or pension sharing orders, or you transferred your pension out of the Scheme, we’ll be completing this review in the next phase of this exercise.
If you’re owed arrears for any extra pension you should have received in the past, you’ll be paid a one-off lump sum (with interest), which will be subject to income tax.
When applying interest, we have used the applicable Bank of England rate, plus 1%.
You don’t need to do anything.
If your pension is affected we’ll write to you to let you know and we’ll apply the change automatically.
If you’ve built up a GMP between 17 May 1990 and 5 April 1997, we’ve updated retirement calculations to make sure that GMP equalisation is taken into account.
If your pension as a spouse includes a GMP that was built up between 17 May 1990 and 5 April 1997, your pension will be reviewed. If the review results in a change to the amount you receive, we’ll write to you to let you know.
If you transferred a pension into this Scheme from another pension scheme that is affected by GMP equalisation, the administrators of that scheme should contact you if you’re due additional payments. This also makes checking your pension in the M&S Pension Scheme more complicated and so we may not have reviewed your pension yet. (Please see ‘Why haven’t I received a letter?’ below).
Checking GMP for all affected members involves a great deal of work. That work includes running through the Scheme’s historical data back to 1990. It also involves working with specialist advisers and the Scheme’s administrator to recalculate benefits, and tracking down members who have left the Scheme.
In November 2025, we issued a letter to members:
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Who worked for M&S between 17 May 1990 and 5 April 1997;
- Receiving a pension that was due to increase as a result of this review; and
- Whose pension benefits were not affected by other factors, such as transfers in or pension sharing orders.
Members whose pension is affected by other factors will take a little longer to complete due to extra complexities.
The majority of pensioners will already be receiving the right amount of pension. If your pension is not due an increase as a result of this review or you do not have a GMP built up in the applicable period, you’ll not receive a letter.
If your pension is due an increase and you receive your pension communications by email, you’ll not receive a letter in the post and you’ll need to download a copy by logging in to the portal.
If you normally receive your pension communications in the post, you will not receive a letter if your annual pension is due to change by less than £1 or you are due a lump sum of less than £12 to cover historic underpayments. Your letter will be available to you online on the portal or can be requested from the Pensions Administration Team, if required.
If your pension is affected by other factors, such as a transfer in or pension sharing order, or you transferred your pension out of the Scheme, we’ll write to you once the review of your pension has been completed and if an increase to your pension is needed. Due to the complex nature of your pension calculation, it’ll take a number of months to complete the necessary calculations.
You can look at your pension payslips by logging in to the portal. Once logged in, on the portal homepage go to “My Pension” and click on either “Last payslip” or “Payslip history”. If you received a letter in November 2025, any changes to your pension will be shown in your December 2025 payslip.
If you haven’t started to receive your pension yet and you’re thinking about transferring your pension, we’ll explain what your options are, together with your transfer value, when we send you a transfer pack.
If you built up a GMP in the Scheme between 17 May 1990 and 5 April 1997 and then transferred your pension to another scheme, we’ll check if the change to GMP rules means that amount transferred should have been higher. If so, we will put the extra money in your new scheme.
If your current pension puts you very close to a higher income tax band, an increase might push you into paying a higher rate of tax on the extra income.
If you’re due a one-off lump sum payment for any extra pension you should have been paid in the past, this amount will be subject to income tax. If the one-off lump sum payment means you’ll pay a higher rate of tax this tax year compared to the rate you would have paid if the pension had been paid when it was due, you can request a breakdown of your one-off lump sum by tax year from the Pensions Administration Team as you may be able to reclaim tax from HMRC.
If you have any questions or concerns about tax, please contact HMRC or speak to a financial adviser. The tax reference code for the M&S Pension Scheme is 951/BMP.
If your pension has been impacted and you receive an increase, it’s regarded as extra income and it may affect other benefits you’re getting, such as Pension Credit.
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