On the go: Some defined benefit scheme members could still be waiting on payments of up to £25,000 resulting from guaranteed minimum pension equalisation, according to research by XPS Pensions.
Next month will mark the two-year anniversary of the GMP equalisation judgment, which required changes be made to GMPs — chiefly those built up over the 1980s and 1990s — to ensure that men and women are treated equally.
Mercer has estimated that this affects 80 per cent of DB schemes, and industry estimates suggest 5m people may be impacted. The XPS research suggests that between 1.25m and 1.5m people could still be owed some form of back payment resulting from equalisation.
The research shows that the top 5 per cent of pensioners owed money can expect an average of £10,000 each, while in the most extreme circumstances pensioners could be entitled to £25,000. The average back payment across all affected members is £1,000.
Commenting on the research, Vicky Mullins, GMP equalisation lead at XPS Pensions, said: “We are seeing a tendency to push GMP equalisation into the long grass, but this is untenable given the average age of those owed money and the not insignificant amounts of money owed.
“There is no reason why pension schemes cannot move forwards with GMP equalisation now,” she continued.
“It is not as complicated as it first appears if you avoid getting bogged down in data. It is incredibly important that members receive the money they are entitled to, particularly at this difficult economic time where older pensioners may have significant need for income.”
