Increases and payment dates
The payroll team looks after your benefit payments and issues P60s.
Pensions payable from the Scheme are reviewed in April each year and increased in line with the percentage increase in the Retail Prices Index (RPI) for the 12 months up to the previous September.
This year the main annual pensions increase will be 3.3%, this will be applied with effect from Monday 8 April 2019. This is in line with the increase in the RPI for the 12 months up to September 2018.
If you built up pension in the Scheme between 6 April 1978 and 5 April 1997, you may have a Guaranteed Minimum Pension (GMP) element to your pension, which is increased at a different rate.
You’re paid on the 15th of the month. If your payment date lands on a weekend or a bank holiday, you’ll be paid on the previous working day.
Payslips and P60s
We only provide a payslip if your monthly payment changes by more than £1.01 or if your tax code changes.
We send you a copy of your P60 in April each year. It details your total pension payments and tax for the previous tax year.
You can also view your personal tax account by registering on the HMRC website.
Guaranteed Minimum Pension (GMP)
Potential increase (uplift)
The National Grid UK Pension Scheme (the ‘Scheme’) was contracted out of the State Earning Related Pension Scheme (SERPS) from 6 April 1978 to 5 April 2002. Many pension schemes contracted out of SERPS (which was a top-up to the Basic State Pension). As a result, both members and participating employers paid lower National Insurance contributions. In exchange, the Scheme took on responsibility for paying the equivalent ‘top-up’ pension you would have earned through SERPS.
If you had contracted-out service in the Scheme between 6 April 1978 and 5 April 1997, this part of your pension is called GMP. GMP is the guaranteed minimum pension the Scheme has to provide to you if you had contracted-out membership during this period, once you reach GMP age. GMP age is not necessarily the same as the Scheme’s Normal Retirement Age – it is age 65 for men and 60 for women.
Under the Scheme Rules, you would receive 1/60 of your pensionable salary for every year you were a contributing member of the Scheme. Your pension is made up of three elements:
- GMP built up between 6 April 1978 and 5 April 1988 (pre-88 GMP)
- GMP built up between 6 April 1988 and 5 April 1997 (post 88 GMP); and
- the non-GMP excess, which is the amount of your Scheme pension above the GMP.
The GMP notionally increases in line with the Retail Prices Index (RPI) from the date you leave the Scheme until you reach GMP age. However, the Department for Work and Pensions (DWP) has agreed that pension schemes like ours can revalue your GMP at a fixed rate for each complete tax year between when you left the Scheme and your GMP age. The rate we apply as an increase to your GMP depends on when you left the Scheme, as the following table shows:
Fixed-rate GMP revaluation
|Date of leaving the Scheme||Fixed rate of revaluation|
|6 April 2017 – 5 April 2022||3.5%|
|6 April 2012 – 5 April 2017||4.75%|
|6 April 2007 – 5 April 2012||4.0%|
|6 April 2002 – 5 April 2007||4.5%|
|6 April 1997 – 5 April 2002||6.25%|
|6 April 1993 – 5 April 1997||7.0%|
|6 April 1988 – 5 April 1993||7.5%|
|Before 6 April 1988||8.5%|
When you reach GMP age, we do a test to give you the better of the notional RPI increase and the fixed-rate revaluation, from the date you left the Scheme. If the fixed-rate increase on the GMP is higher than RPI, your pension will be increased. This is known as an ‘uplift’ and will be equal to the difference between the RPI and fixed-rate increases.Example:
|GMP at exit x RPI increases||£1,400.00 a year|
|GMP at exit x 7% increases||£2,000.00 a year|
|Uplift to pension at GMP age||£600.00 (£2,000.00 - £1,400.00) a year|
Once you reach GMP age, the Scheme will apply the following annual increases to your pension:
|Pre 88 GMP||0%|
|Post 88 GMP||Consumer Prices Index (CPI), up to a maximum of 3%|
|Pension (Not GMP)||Retail Prices Index (RPI) for September of the previous year|
Finally, please note that a recent High Court decision means that GMPs for some members may need to be adjusted to remove inequalities arising from the way GMPs were calculated for men and women. The Trustees have not yet finalised how this adjustment will be calculated, so this has not been included in your estimated figures. Any top-up is expected to be relatively small.