Increases in deferment
Your deferred pension will increase between the time you leave the Scheme and the date you retire.
If you were a member of the Scheme between 6 April 1978 and 5 April 1997, your deferred pension will be made up of two parts – the Guaranteed Minimum Pension (GMP) and a pension in excess of GMP.
Both parts are treated differently when applying increases.
Whilst your pension remains deferred, any GMP you have earned up to 5 April 1997 is increased at a fixed rate specified by the Government. The fixed rate used to increase your GMP depends on when you left the Scheme. The following table provides details:
Date of Leaving Scheme
Rate of GMP Increase (per annum)
|6 April 1978 - 5 April 1988||8.50%|
|6 April 1988 - 5 April 1993||7.50%|
|6 April 1993 - 5 April 1997||7.00%|
|6 April 1997 - 5 April 2002||6.25%|
|6 April 2002 - 5 April 2007||4.50%|
|6 April 2007 - 5 April 2012||4.00%|
|6 April 2012 - present||4.75%|
By law, if you left the Scheme after 1 January 1986, any pension in excess of GMP earned after 1 January 1985 must be increased in line with the Government's minimum increase rate, which is currently the rise in the Consumer Prices Index (CPI), up to 2.5% a year
From 1 April 2012, Diageo changed the way it increases pensions in deferment. From 1 April 2012 your deferred pension will increase in line with the CPI, up to 5% a year, provided the cost of making the extra increase above the legal minimum is affordable, given the Company's and Scheme's financial positions at the time. Any increases that have already applied to your deferred pension, which will generally have been in line with the RPI, are not affected by the change. These increases will normally be applied when your benefits become payable or on transferring benefits to another pension scheme.
Please note that the level of increase is determined by the Trust Deed and Rules that were in force at the date you became a deferred member. Therefore, depending on the section of the scheme you belonged to and the date you became a deferred member your deferred pension may increase at a different level to that described above.
The Pensions Team prefers not to project the value of your pension benefits at a date in the future. That's because it's impossible for us to accurately predict future Scheme increases. However, following your request, we'll be pleased to let you know the notional value of your deferred pension taking into account increases that have been declared since the date you left the Scheme.
This ensures that you receive information expressed only in today's terms rather than receiving misleading information about the future value of your deferred pension.
If you would like to know the current value of your deferred pension, please contact the Pensions Team.
Increases once in payment
Your pension increases at different rates depending on when the pension was earned, whether you are over or under GMP age and how much is in respect of GMP.
Click here for further details on how pensions in payment are increased.