Commons Sense

House of Commons · Adjournment Debate

Pre-1997 Pensions: Discretionary Increases

19 March 2026 · 2 other contributors

Opened by Luke Akehurst Lab North Durham

Benefits & Welfare

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Luke Akehurst raised concerns about pre-1997 pensions: discretionary increases in the House of Commons. A government minister responded. Other MPs also contributed.

Key points

  • Concerns raised about 1 million pensioners losing out on pension increases due to work before April 1997, when defined-benefit pension schemes were not legally required to increase in line with inflation.
  • The Pensions Act 1995 introduced statutory price indexation for pensions from contributions made after April 1997 but not for those made before.
  • Many pre-1997 defined-benefit pension schemes have seen no increases for decades, leading to real-terms cuts over time.

How the debate unfolded

MPs spoke in turn to share their views and ask questions. Here's what each person said.

Opened the debate

Luke Akehurst Lab North Durham

Across the country, an estimated 1 million pensioners are losing out on pension increases that they ought to be entitled to because their hard work occurred before April 1997. Before this date, defined-benefit pension schemes were not legally required to increase in line with inflation. The Pensions Act 1995 introduced statutory price indexation for pensions from contributions made after April 1997 but not for those made before. Many pre-1997 defined-benefit pension schemes have been subject to zero increases, leading to real-terms cuts over time. For example, the Nissan pension scheme has not increased these pensions for a quarter of a century despite being in surplus since 2022. The Pre-97 Pension Justice campaign group reports that at least 13 companies have had decades-long periods without discretionary increases. Pensioners fear a new policy by trustees that will prevent future increases, leaving them with significantly lower incomes than they should receive.

Other contributors (2)
  • Liz Twist Lab Halton

    Pensioners affected by the Special Metals Wiggin pension fund have not received any top-up payments since legislation was introduced, leaving their incomes significantly lower. The campaigner Steve Mawby has been a key figure in raising awareness of this injustice.

  • Jesse Norman Con Hereford and South Herefordshire

    The trustees are often controlled by the company, preventing discretionary increases even when the scheme is in surplus. The Minister should consider requiring trustees to pay top-ups from surpluses.

Government Response

Torsten Bell

I thank Luke Akehurst for securing this debate and recognise the difficulties faced by pensioners due to high inflation. Defined-benefit schemes have different approaches to indexation, with some providing discretionary increases under scheme rules while others do not allow it. The Pensions Act 1995 introduced statutory price indexation from April 1997 onwards but did not retrospectively change pre-1997 accruals. This situation causes frustration for pensioners and their representatives. While we cannot change long-standing rules retrospectively, the Pension Schemes Bill will give trustees more flexibility to release surplus funds, which can be used to negotiate benefit improvements with employers. Trustees have discretion to insist on discretionary pre-1997 indexation as a condition for surplus release. I recognise that some pension schemes are actively choosing not to award discretionary increases despite being in surplus due to employer constraints. The Pensions Regulator will consider how to build its evidence base in this area. I pay tribute to all Members who have participated and raised awareness of these issues.

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