GMP conversion Bill receives Royal Assent

A Bill designed to clarify some known issues in the rules allowing conversion of guaranteed minimum pensions (GMPs) into other pension benefits has become law.

The Pension Schemes (Conversion of Guaranteed Minimum Pensions) Act 2022 received Royal Assent on April 28, 2022. Once in force it will:

• Confirm that GMP conversion can be applied to survivors, not just to the person who earned the GMP.

• Remove the need to notify HMRC of the conversion.

Detailed regulations will follow to address key areas, namely:

• Which employer needs to provide consent for conversion.

• What level of minimum survivor pension needs to be provided post-conversion.

The Act provisions are not yet in force and we await a commencement date along with the detailed regulations. Given the cross-party support for this Act, we are hopeful that we won’t be waiting long.