Statutory minimum increases and revaluation for occupational pensions: LPI caps, CPI/RPI changes, pre-1997 indexation and money purchase exceptions

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Statutory minimum increase rates

The summary below sets out the current statutory minimum uplift that occupational pension schemes must apply each year to each tranche of pension.

Period of pensionable service to which the pension relates (or, for money purchase benefits, the period in which contributions were paid): Before 6 April 1997 — no statutory minimum increase. However, to refund surplus assets to a sponsoring employer under the Social Security Pensions Act 1975, s 58A, it was necessary (until 5 April 2006) to revalue all pensions in payment (excluding GMPs and money purchase benefits) annually in line with RPI, capped at 5%.
Despite the absence of a statutory minimum, most defined benefit schemes provide some pre-1997 indexation under scheme rules or as a discretionary benefit.
As at March 2023, research indicates that only 17% of members of private sector defined benefit schemes receive no pre-1997 indexation on benefits.
There have been calls on the government to legislate to mandate inflation-linked increases to pensions in payment for benefits accrued before April 1997...

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Web page updated on 20/05/2026

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