Statement on Equalisation for GMPs AND the application of a ...

2.8% and 3% are UK Guaranteed Minimum Pension Increase Orders effective on 6 April2004 and 2005 respectively.2. Late Retirement Pension iro NPA 60 trancheScheme method is to revalue pension to Normal Pension Age 60 and then apply a lateretirement factor.Late retirement pension at age 61 8/12 (1 8/12 years late)= [(264.00 x 1.0625 5 ) + (316.00 x 1.146)] x (1 + 0.12 x 1 8/12) = £863.54 pawhere:14.6% = Occupational Pensions (Revaluation) Order 2003 for 6 year revaluation period5 revaluations are granted to the female GMP at 6/4/1998 - 6/4/2002 inclusiveStatutory requirements for female at age 61 8/12(a)Contracting-out legislation - relates to all GMPRevalued female GMP at age 61 8/12= [1104.00 x 1.0625 5 ] x [(1 + (1x52+38)/700) x (1.028x1.03)]= 1,494.91 x 1.19498= £1,786.39 paIn practice this test would be carried out with the whole GMP against the Pre 97 pension.However, the fact that the minimum is clearly covered at retirement iro these elementsindicates that the overall test should be met.(b) Anti-franking and preservation legislationSee comment for males above.Pre 97 PPF compensation at Relevant Time1. NPA 65 trancheThis is firstly calculated prior to the application of the compensation cap and 90% multiplier.= 2,243.84 + 1,359.21x (1.027 x 1.03 – 1) = £2,322.42 paHowever, this now contains an element of female GMP. As the member is over female GMPage 60 at the Relevant Time, the GMP element is paid at 100%. The excess pension is paidat 90% since the member is below age 65 at the Relevant Time.= (1,359.21x1.027x1.03x 100%) + (2,243.84 – 1,359.21) x 90% = £2,233.95 pa2. NPA 60 trancheSince the member is age 63 at the Relevant Time the NPA 60 tranche is not affected by thecompensation cap and 90% multiplier.= [863.53 + 427.18 x (1.027x1.03 - 1)]= £888.23 pa149