15 March 2007 - The social security revaluation of earnings factors order 2007

The Social Security Revaluation of Earnings Factors Order 2006 (SI 2007/20070781) was laid before Parliament today. The Order, made annually under Section 148 of the Social Security Administration Act 1992, sets out the way in which earnings are to be revalued for benefit purposes on claims after 6 April 2000. These annual increases, which are in line with the movement of average earnings, mean that when State Pension or widow's benefit are claimed, the earnings upon which the additional pension (State Earnings-Related Pension Scheme (SERPS) pension) is calculated are always expressed in current terms.

The Order is an important part of the way earnings-related pensions build up in the state scheme, and is used for corresponding purposes by occupational pension schemes contracted-out of the state scheme to revalue guaranteed minimum pensions.

 We calculate the value today of previous years' NI contributions using the GB national average earnings index.

The SI can be accessed at: http://www.opsi.gov.uk/si/si2007/20070781.htm

The figures are also available on the DWP Website at: http://research.dwp.gov.uk/asd/reval.asp

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