Guaranteed minimum pension (GMP) conversion
Produced in partnership with David Everett

The following Pensions practice note produced in partnership with David Everett provides comprehensive and up to date legal information covering:

  • Guaranteed minimum pension (GMP) conversion
  • Legal regime
  • The conversion conditions
  • Trustee powers
  • Power to reshape benefits
  • Other powers
  • Condition 1—Actuarial equivalence
  • Benefits to value
  • Shape of converted benefits
  • Actuarial method
  • More...

Guaranteed minimum pension (GMP) conversion

FORTHCOMING DEVELOPMENT: The operative provisions of the Pension Schemes (Conversion of Guaranteed Minimum Pensions) Act 2022 will come into force on a date that has yet to be appointed.
Regulations are to be made under the Act concerning (i) survivor benefit requirements post-conversion, and (ii) circumstances where employer consent will not be required or the consent of some other person will be required instead.

Separately, the government’s guidance on the use of the GMP conversion legislation published in 2019 is expected to be updated to reflect recent developments, including the provisions contained in the Pension Schemes (Conversion of Guaranteed Minimum Pensions) Act 2022.
For further information, see: Pension Schemes (Conversion of Guaranteed Minimum Pensions) Bill, Hansard: Pension Schemes (Conversion of Guaranteed Minimum Pensions) Bill, Volume 820: debated on Friday 25 March 2022, Hansard: Pension Schemes (Conversion of Guaranteed Minimum Pensions) Bill, Volume 821: debated on Wednesday 27 April 2022.

This Practice Note describes and comments on the process that must be undertaken should the trustees of an occupational pension scheme with guaranteed minimum pension (GMP) liabilities wish to convert them into other defined benefits (DB benefits). This facility, which came into force on 6 April 2009, has been seen as the means to remove the complex administrative and legislative requirements that affect GMPs and to make it easier for members

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