The Department for Work and Pensions (DWP) has issued an update regarding the Additional Pension (AP) scheme, confirming that certain state pensioners who reached retirement age before 2016 could be entitled to payments of up to £922 a month.
The enhanced payments apply to older pensioners who qualify for legacy schemes, specifically the State Earnings-Related Pension Scheme (SERPS) and the Second State Pension. Following an uprating in April, the maximum weekly AP payment rose from £222.10 to £230.54, which, when calculated over a month, can provide eligible claimants with as much as £922.
The Additional Pension was designed as a supplementary payment that functions alongside the basic state pension. While the government has closed the scheme to new applications, existing beneficiaries continue to receive these funds as part of their regular retirement income.
However, the DWP has clarified that the exact amount an individual receives is not fixed. It is determined by several personal factors, including the number of years the individual paid National Insurance contributions, their earnings during their working life, and whether they chose to “contract out” of the scheme.
According to guidance from Which?, the eligibility criteria for the scheme evolved over the years. Before 2002, individuals could only contribute to the additional state pension (SERPS) if they were employed. This changed with the introduction of the State Second Pension, which ran from 2002 to 2016. Under this version, contributions could be made through National Insurance, covering not only employees earning at least £113 a week but also those caring for children under 12, recipients of carer’s credit, and those claiming certain disability-related benefits.
Prior to the major state pension reforms on April 5, 2016, employees had the option to “contract out” of the Additional State Pension, often by contributing to a private or workplace pension instead. As of that date, all contracting-out arrangements were brought to an end, and all National Insurance contributions are now made at the standard rate until the individual reaches the state pension age.
Because the calculation of these payments is tied to specific employment histories and previous pension arrangements, the amount each pensioner receives can vary significantly. While the maximum potential payment is £230.54 per week, many beneficiaries will receive varying amounts based on their unique records held by the DWP.
Existing beneficiaries are advised that these payments are included in their regular state pension disbursements. For those looking to verify their specific pension entitlement, the government provides official resources through the DWP to review National Insurance records and state pension statements.
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