Inheriting additional State Pension

When the State Earnings Related Pension Scheme (SERPS) was introduced in 1978, there was provision for widows to inherit up to 100% of their late husband’s entitlement. Widowers were also entitled, although initially on a more limited basis. From 2010, men and women have been entitled on the same basis. When civil partnerships and same-sex marriages were introduced in 2005 and 2013, entitlement was on the same basis as for widowers. This is discussed in more detail in Library Briefing Paper SN-03035 Pensions: civil partnerships and same sex marriages (October 2015).

In 1986, the Conservative Government, concerned at the emerging costs of SERPS, passed legislation which reduced the percentage of SERPS which could be inherited from 100% to 50% in respect of a death on or after 6 April 2000. However, as a result of inadequate publicity for this change, the Labour Government decided to postpone it until 6 October 2002 and to phase in the reduction so that the full 50% cut would not be achieved until 6 October 2010. For those who had been misinformed and were not fully covered by the new arrangements, the departmental compensation scheme was a possibility. This is discussed in more detail in Library Briefing Paper SN-00706 Reductions in inherited SERPS (June 2016).

A new State Pension (nSP) was introduced on 6 April 2016, for people reaching State Pension age on or after that date. The Coalition Government said it intended people to qualify on the basis of their own NI record and that there was “no rationale” for allowing them to inherit or derive state pension income based on the NI record of their spouse or civil partner. However, there is transitional protection to cover pre-implementation NI records. There would be no change where both members of a couple reach, or would have reached, SPA before the nSP was introduced. In other cases, the transitional arrangements depend on when the survivor and deceased reach SPA.