Why is equalisation needed?
Both SERPS and GMPs targeted the same benefit as a proportion of earnings by the GMP age of 60 for women and 65 for men. Women generally built up GMP more quickly than men with the same earnings and service history, because the intention was to provide the same pension for women at 60 as for men at 65.
This means that although women and men with the same earnings and service history accumulate the same amount of scheme pension in any year, the split of the pension built up between GMP and non-GMP will differ for men and women.
What does the law require?
In equalising GMPs, members with GMPs built up between 17 May 1990 and 5 April 1997 may receive a small topup to their benefits. Those members receiving a pension may also receive a back payment to compensate for past inequalities. As a result, all schemes with GMPs will see an increase in the value of their scheme liabilities.