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.