Guaranteed minimum pension
In this section
If you built up pension between April 1978 and April 1997, or transferred in benefits that included this protection, your pension from the firefighters’ pension scheme may include a guaranteed minimum pension. This section explains what the guaranteed minimum pension is, why it matters and how it interacts with your pension increases.
What is guaranteed minimum pension?
For members between 6 April 1978 and 5 April 1997
The guaranteed minimum pension is a minimum level of pension built into your firefighters’ pension scheme pension if you were a member between 6 April 1978 and 5 April 1997 or transferred in pension rights that included a guaranteed minimum pension from another scheme.
It is not a separate pension – it is the minimum amount that your pension from the firefighters’ pension scheme must reach.
In most cases your firefighters’ pension scheme pension will be higher than the guaranteed minimum pension. Your guaranteed minimum pension is included in your pension from the firefighters’ pension scheme.
Why is guaranteed minimum pension important?
Contracting out
The guaranteed minimum pension, ensures a minimum level of pension for service between 6 April 1978 and 5 April 1997, ensuring you get at least what you would have received under the State Second Pension had you have not been contracted out. More information relating to this is included within the why was the guaranteed minimum pension introduced? section below.
If you have a guaranteed minimum pension, part of your annual pension increase may be paid with your state pension.
You still receive the full increase overall – it is just shared between your pension from the firefighters’ pension scheme and your state pension.
Why was guaranteed minimum pension introduced?
A guaranteed amount
Occupational pension schemes - including the firefighters’ pension scheme - could contract‑out of the state second pension. Members who were contracted‑out paid a lower rate of national insurance and did not build up that part of the state pension.
In return, schemes that contracted‑out had to guarantee that a member’s pension would be at least as much as they would have received under the state second pension. This guarantee became the guaranteed minimum pension.
Before April 2016 the state pension had two tiers - the basic state pension and the state second pension (formerly known as SERPS).
How does guaranteed minimum pension affect your pension increase?
Reviewing the value
Each April, your pension is increased in line with the consumer price index.
If your pension starts after guaranteed minimum pension age but before your state pension age, the full increase is included with your firefighter pension payments.
Once you reach state pension age, responsibility for paying increases on the guaranteed minimum pension element may be shared between your pension from the firefighters’ pension scheme and the department for work and pensions through your state pension.