More than 66,000 pensioners will have to wait an extra year for an inflation-linked increase to their compensation payments, as the Pension Protection Fund (PPF) confirmed it cannot meet the original deadline for all eligible recipients.
Delayed payments for 66,000
The PPF was expected to deliver the increase in January 2027, but limited resources and difficulties in determining Guaranteed Minimum Pension (GMP) entitlements mean some members will not receive the boost until January 2028.
Around 265,000 members will get the increase from next year, but the remaining 66,000 will have to wait at least 12 months longer.
Background on GMP and schemes
GMPs apply to workers who built up pension rights in the UK between April 6, 1978, and April 5, 1997, while their workplaces were "contracted out" of the additional state pension.
The Financial Assistance Scheme (FAS) applies to pension schemes that collapsed between January 1997 and April 2005, while the PPF covers those that have gone under since. Pension entitlements accrued after 1997 were already eligible for inflationary uplift, but years built up before that date currently receive no such protection.
Campaigners criticise delay
Campaigners have hit out at the delayed payments. Maurice Alphandary, head of the AEA Technology Pensions Campaign, branded it "disgusting", according to LBC. "They're already agreed on a course of action, and now they're backtracking," he added.
Terry Monk, of the Pensions Action Group, also warned that people were "dying waiting" for the expected increase.
PPF and government respond
A spokesperson for the PPF said: "Our priority is to implement payments from January 2027 for around 265,000 members whose schemes provided wider pre-1997 increases. This approach gives us the greatest confidence in delivering those payments accurately and on time.
"We will then complete the additional work required for around 66,000 members whose schemes provided increases only on post-1988 GMP benefits, with payments expected from January 2028. While we appreciate this will be disappointing for those members, we believe this phased approach is the most effective way to deliver these important changes successfully for everyone affected."
A Government spokesperson added: "We are making the biggest change to pension compensation in over 20 years, benefiting over 250,000 PPF and FAS members. The vast majority of eligible members will receive these increases from January 2027, the earliest possible date."
