# The Pensions Increase (Review) Order 2018

S.I. 2018/333 · made 8 March 2018

Under section 59 of the Social Security Pensions Act 1975 (c.60) the Treasury have to provide by Order for the increase in the rates of public service pensions. The Pensions (Increase) Act 1971 (c.56) defines certain terms and sets out when a pension “begins” (the day after the last day of service in respect of which the pension is payable) and how the increase applies to lump sums.

Made under: Social Security Administration Act 1992; Social Security Pensions Act 1975

## Introductory text

Pensions
Made 8th March 2018
Laid before Parliament 9th March 2018
Coming into force 9th April 2018
The Secretary of State for Work and Pensions has, by virtue of section 151 of the Social Security Administration Act 1992, given a direction that the sums mentioned in section 150(1)(c) of the Act are to be increased by a specified percentage.
The Treasury make the following Order in exercise of the powers conferred by section 59(1), (2), (5) and (5ZA) of the Social Security Pensions Act 1975 and now vested in them:

## 1 Citation and Commencement

This Order may be cited as the Pensions Increase (Review) Order 2018 and comes into force on 9th April 2018.

## 2 Interpretation

(1) In this Order, “the Act” means the Social Security Pensions Act 1975.
(2) In this Order, any reference to a pension is a reference to a pension which began before 9th April 2018.

## 3 Pensions increase: annual rate and lump sums

(1) This article applies to an official pension if—
(a) a qualifying condition is satisfied; or
(b) the pension is—
(i) a derivative pension;
(ii) a substituted pension; or
(iii) a relevant injury pension.
(2) In relation to any period on or after 9th April 2018, the pension authority may increase the annual rate of the pension—
(a) for a pension which began before 10th April 2017, by 3 per cent;
(b) for a pension which began on or after 10th April 2017, by 3 per cent multiplied by—
A 12 where A is the number of complete months in the period between the beginning date of the pension and 9th April 2018.
(3) In relation to a lump sum which is payable on or after 10th April 2017 but before 9th April 2018, the pension authority may increase the lump sum by 3 per cent multiplied by—
A 12 where A is the number of complete months in the period between the beginning date for the lump sum (or, if later, 10th April 2017) and the date on which it became payable.

## 4 Reductions in respect of guaranteed minimum pensions

(1) Where—
(a) a pension is entitled to an increase in a guaranteed minimum pension on 9th April 2018; and
(b) entitlement to that guaranteed minimum pension arises from an employment from which (either directly, or indirectly by virtue of the payment of a transfer credit) entitlement to the official pension also arises;
the amount by reference to which any increase is calculated for the purposes of article 3(2) must be reduced by an amount equal to the rate of the guaranteed minimum pension unless the Treasury otherwise direct in accordance with the provisions of section 59A of the Act.
(2) Where on the death of a deceased spouse or civil partner a person becomes entitled to a guaranteed minimum pension in relation to a surviving spouse’s pension or a surviving civil partner’s pension, the amount by reference to which any increase is calculated for the purposes of article 3(2) must be reduced in accordance with section 59(5ZA) of the Act.

## Signature

Rebecca Harris
Andrew Stephenson
Two of the Lords Commissioners of Her Majesty’s Treasury
8th March 2018

## Explanatory note

(This note is not part of the Order)
Under section 59 of the Social Security Pensions Act 1975 (c.60) the Treasury have to provide by Order for the increase in the rates of public service pensions. The Pensions (Increase) Act 1971 (c.56) defines certain terms and sets out when a pension “begins” (the day after the last day of service in respect of which the pension is payable) and how the increase applies to lump sums.
The increase is the percentage by which the Secretary of State for Work and Pensions has, by direction under section 151(1) of the Social Security Administration Act 1992 (c.5), increased the additional pension entitlements accruing to employees in respect of earnings after 5th April 1978.
For pensions which began before 10th April 2017 the increase is 3 per cent. For pensions which began on or after 10th April 2017 the increases (following the calculation set out in article 3) are as follows—
Table
Pensions Beginning
Pensions increase
10th April 2017 to 24th April 2017
3.00%
25th April 2017 to 24th May 2017
2.75%
25th May 2017 to 24th June 2017
2.50%
25th June 2017 to 24th July 2017
2.25%
25th July 2017 to 24th August 2017
2.00%
25th August 2017 to 24th September 2017
1.75%
25th September 2017 to 24th October 2017
1.50%
25th October 2017 to 24th November 2017
1.25%
25th November 2017 to 24th December 2017
1.00%
25th December 2017 to 24th January 2018
0.75%
25th January 2018 to 24th February 2018
0.50%
25th February 2018 to 24th March 2018
0.25%
Article 4 of the Order provides for increases on certain deferred lump sums which became payable on or after 10th April 2017 and before 9th April 2018.
The Order also makes provision for the amount by reference to which any increase in the rate of an official pension is to be calculated to be reduced by the amount equal to the rate of the guaranteed minimum pension entitlement deriving from the employment which gives rise to the official pension.
An impact assessment has not been produced for this instrument as no significant impact on the private, voluntary or public sectors is foreseen.

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Source: https://www.legislation.gov.uk/uksi/2018/333 (the official version)
Page: https://openlegislation.uk/pensions-increase-review-order-2018
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.