What is a Guaranteed Minimum Pension (GMP)?


  • Members
  • General

In April 1978, a state pension was introduced which provided:

  • a flat rate state pension available for everyone regardless of their employment history.
  • an additional state pension (also called the State Second Pension or SERPS).

If you were a member of a scheme that was contracted out of the additional state pension, you and your employer will have paid a lower rate of National Insurance contributions. A condition of this was that the Scheme must pay you an equivalent amount of pension that you would have received were you not contracted out. This is the Guaranteed Minimum Pension.

Only members with service from 6 April 1978 to 5 April 1997 accrued a GMP. The GMP is based on earnings and National Insurance contribution records. It is not a separate benefit but your pension must equal or exceed the GMP. The GMP is paid to you during retirement or to your spouse or civil partner after your death.