Under the provisions of the Pensions (Increase) Act 1971, made in accordance with the Social Security Pensions Act 1975, the increase to be applied to public sector pensions is 0.5% and is payable from 12 April 2021.

If you have not been in receipt of your pension for a full year, only a proportion of the annual increase is payable.

Pension Increase is only paid from age 55 with some exceptions, if the pension is an Ill Health or dependant’s pension.

NHS and Teachers FAQ

Q. Who decides on the pensions increase each year and when is it done?

A. The Secretary of State for Work and Pensions makes the announcement in a draft Pensions Increase (Review) Order which is approved by the UK Parliament usually during March each year. The new rate of increase takes effect from the first Monday after 5 April.

Q. How much is the increase for 2021/2022?

A. 0.5% payable from 12 April 2021. This is based on the Consumer Price Index as at September 2020 and advised by HM Treasury.

Q. Why does my first pension payslip, for payment due after 6 April 2021, not reflect a full month’s increase?

A. Your pension this year is increased from 12 April 2021; therefore you will receive an increase in the rate payable only from that date. The first payment will therefore consist of a number of days at the old rate and the remainder at the new rate, the following months payment will reflect your first full increase.

Q. My increase does not work out to the full percentage increase, this could be for a number of reasons:

(i) For any pension put into payment before age 55, the increase will not be applied until the 55th birthday, unless the member retired on health grounds, is a widow/widower or is receiving a dependents benefit.

(ii) If a new pension was put into payment on or after 27 April 2021, no increase will be due until next year.

(iii) You have a Guaranteed Minimum Pension (GMP) [also known as Contracted Out Pension Equivalent (COPE)] component within your pension.

Q. Why has my tax code changed?

A. We are instructed by HMRC to apply the relevant tax code. If your tax code has changed and you require further information or have any questions about your tax, please contact HMRC on 0300 200 3300 and have your National Insurance number to hand when you make your call.

If you have any further questions please email the Payroll Team at sppacontactus@gov.scot.

Police and Firefighter FAQ

Q. Who decides on the pensions increase each year and when is it done?

A. The Secretary of State for Work and Pensions makes the announcement in a draft Pensions Increase (Review) Order which is approved by the UK Parliament usually during March each year. The new rate of increase takes effect from the first Monday after 5 April.

Q. How much is the increase for 2021/2022?

A. 0.5% payable from 12 April 2021. This is based on the Consumer Price Index as at September 2020.

Q. Why does my first payslip, for payment due after 12 April 2021, not reflect a full month’s increase?

A. Your pension this year is increased from 12 April 2021; therefore you will receive an increase in the rate payable only from that date. The first payment will therefore consist of a number of days at the old rate and the remainder at the new rate, the following months payment will reflect your first full increase.

Q. If this year’s Pensions Increase is 0.5%, why has my gross monthly amount not increased by that rate?

A. The full 0.5% Pensions Increase is applied from 12 April 2021 for pensions which started prior to 27 April 2020, where your pension began on or after 27 April 2020 you will only receive a proportionate increase this year.

Q. My increase does not work out to the full percentage increase, this could be for a number of reasons: 

(i) For any pension put into payment before age 55, the increase will not be applied until the 55th birthday, unless the member retired on health grounds, is a widow/ widower or is receiving a dependents benefit.

(ii) If a pension was put into payment on or after 27 March 2021, no increase will be due until next year.

Q. Why has my tax code changed?

A. We are instructed by HMRC to apply the relevant tax code. If your tax code has changed and you require further information or have any questions about your tax, please contact HMRC on 0300 200 3300 and have your National Insurance number to hand when you make your call.

If you have any further questions please email the Police and Fire Team at sppacontactus@gov.scot.