Pension increases and revaluation—statutory minimum
Pension increases and revaluation—statutory minimum

The following Pensions practice note provides comprehensive and up to date legal information covering:

  • Statutory minimum increase rates
  • Statutory minimum level of revaluation

Statutory minimum increase rates

The table below summarises the current statutory minimum increase that occupational pension schemes must apply annually to each tranche of pension.

Period of pensionable service to which pension is attributable (or, in the case of money purchase benefits, period in which contributions were made) Statutory minimum pension increase Source
Before 6 April 1997 None, save that in order to refund surplus assets to a sponsoring employer under the Social Security Pensions Act 1975, s 58A, it used to be necessary (up until 5 April 2006) to revalue all pensions in payment (excluding GMPs and money purchase benefits) annually in line with the Retail Prices Index (RPI) subject to a cap of 5%

Despite the absence of a statutory minimum increase, many defined benefit pension schemes provided, in practice, at least a modicum of inflation protection on a scheme-specific basis
Social Security Pensions Act 1975, s 58A (now repealed)
Between 6 April 1997 and 5 April 2005 inclusive For benefits other than money purchase benefits: the lower of the percentage increase in the Consumer

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