Every year we review Civil Service pensions in payment to determine if they should be increased in line with prices. This review is called Pensions Increase (PI).
PI takes effect from the first Monday after 6 April each year.
We use the Consumer Prices Index (CPI) to September of the previous year to determine PI. If CPI shows an increase in prices, PI will be applied to pensions in payment in line with CPI. If prices have fallen, or remained at the same level, no PI will be applied.
In September 2022, CPI was 10.1%. As a result, Civil Service pensions in payment will increase by 10.1% from Monday 10 April 2023.
There are a number of reasons why you may not have received the full 10.1% increase:
Your tax code may have changed – you can check your tax code on your payslip. If you think it's incorrect, contact HM Revenue & Customs directly on 0300 200 3300.
Pay dates – your pension is paid in arrears. Depending on when your pay date is in the month, you may not see the full increase until next month.
Not all members are eligible for the full 10.1% increase - if you reached state pension age before 6 April 2016 and you were working in the Civil Service prior to 6 April 1997, part of your Pensions Increase is paid within your state pension. Therefore, if you didn’t receive the full 10.1% in your occupational pension, you will have received an increase in your state pension to compensate.
This may be due to a change in your tax code. You can check your tax code by logging into the Pension Portal, by looking at your payslip or by logging onto your HM Revenue & Customs account.
If it has changed, you will need to contact HM Revenue & Customs (HMRC) directly on 0300 200 3300.
Pensions Increase is the annual increase which may be applied to your Civil Service pension. It’s applied at the same percentage as the annual increase to the Additional State Pension.
It’s usually paid to anyone over age 55 and anyone under age 55 who has qualified for:
an ill-health retirement pension
a widow’s pension
a widower’s pension
a civil partner’s pension
a partner’s pension or
a child’s pension
Please note: You may qualify for Pensions Increase before the age of 55 if you have dependent children under the age of 23.
Pensions Increase is applied from the first Monday after 6 April, This year, Pensions Increase will be applied from Monday 10 April.
This year's increase is 10.1%.
Pension payments are made in arrears. Therefore, if you receive your pension at the end of the month (for example, 30 April) your payment will only reflect the new increased rate for part of the month.
Your P60 shows the total of all payments you’ve received during the tax year. This may be different to your annual pension figure because it may consider a number of factors such as a change in the annual rate paid to you, or an increase in pension during the year.
In previous years, you may have received your P60 at the same time as your payslip. However, we now send these documents as soon as they are produced which means you may receive them separately. You should receive both documents by the end of May.
Members are unable to return Pensions Increases as they are entitled to them under statutory legislation. If you’re entitled to the Pensions Increase, this amount will be considered when any benefits are calculated.
Prior to your retirement, you will have received paperwork detailing your pension benefits, including the amount of pension which would be payable to your spouse in the event of your death. If you have any questions about this paperwork please contact us.
We are unable to change your tax code unless HMRC tell us to do so. If you have any queries about your tax code or tax liability, please contact HMRC on 0300 200 3300 or Overseas +44 135 535 9022.
