Bridging pensions
Produced in partnership with Wyn Derbyshire of gunnercooke LLP
Bridging pensions

The following Pensions guidance note Produced in partnership with Wyn Derbyshire of gunnercooke LLP provides comprehensive and up to date legal information covering:

  • Bridging pensions
  • Bridging pensions—background
  • Unequal SPAs for men and women and bridging pensions—how they interact
  • Bridging pensions and equality—case law
  • Bridging pensions—when a bridging pension can be paid until
  • Bridging pensions—power to amend the bridging pension rule to take account of changes to the SPA
  • Bridging pensions and the Equality Act 2010
  • Bridging pensions and the single-tier state pension

Bridging pensions—background

Bridging pensions are a form of pension provided by some (but not all) defined benefit occupational pension schemes in circumstances where a member’s scheme pension commences before state pension age (SPA). As the name suggests, bridging pensions are a form of temporary 'top-up' pension intended to 'bridge the gap' between the date on which the relevant member's 'normal' scheme pension comes into payment, and a later date, typically the member’s SPA when his or her state pension commences.

Unequal SPAs for men and women and bridging pensions—how they interact

Until plans were considered by the Government to equalise the SPAs for men and women in 1993, men had continued to enjoy an SPA of 65 and women 60. Bridging pensions are commonly found where they are used in an attempt to ensure male and female members with differing SPAs enjoy comparable overall income in retirement deriving from both the relevant pension scheme(s) and from the state pension system, notwithstanding the SPA difference.

For example this can be seen where:

  1. a male member (with an SPA age of 65), and

  2. a female member (with an SPA of 60)

Both retire at (say) age 57, each with a normal pension and a bridging pension.

The bridging pension works so that:

  1. the female member's bridging pension would fall away when she attains the age of 60 (and her state pension commences), but

  2. the male member would continue to enjoy payment of his bridging pension until he attains his SPA at the age of 65 and receives his state pension

Bridging pensions and equality—case law

However, over the years, bridging pensions