Pensions - Articles - GMP Equalisation costs may be much lower than expected


The cost of accounting for GMP equalisation is less than 1% of total liabilities for over half of all schemes. This follows a survey of over 90 XPS Pensions Group clients with a 31 December 2018 year-end.

 Wayne Segers at XPS Pensions Group said “This is good news for employers and shows the value of getting a robust estimate that takes into account the specifics of their schemes.”
 
 “However, it appears to confirm a worry that the industry may now incur significant cost and administrative complexity with little real benefit for members. Given that, it is important schemes use the work needed on GMPs to drive improvements. Increasing data quality, streamlining benefits and removing GMPs for good can all help reduce cost and risk for employers, and help drive better options and outcomes for members. “
 
 Those with a March year-end will benefit from a robust estimate of the cost to prevent charging any more than is needed in their accounts. While there are some rules of thumb on costs (e.g. lower costs if GMPs are a smaller part of the benefit), in most cases the costs are impacted by the specific circumstances and membership behaviour in each scheme.
 
  

Back to Index


Similar News to this Story

Suggestion that State Pension Age should increase to 75
In response to the recent suggestion that the state pension age should increase to 75, Aegon calls for Government to confirm pension freedoms will be
GMP Equalisation soars to top of Pension Schemes To Do List
New figures from Equiniti reveal that GMP Equalisation has rocketed in importance for pension schemes following the landmark Lloyd’s case earlier this
XPS launch Competitive Tendering support for Trustees
In June 2019 the Competitions and Markets Authority (CMA) published its Order which implements the remedies that were set out in the CMA’s final repor

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.