State Graduated Pension

In April 1961 the government introduced the State Graduated Pension, also known as the Graduated Benefit or Graduate Retirement Benefit. This was a state scheme related to your National Insurance contributions which were in turn related to your earnings as an employee. Your National Insurance contributions were divided into ‘units’: essentially every £7.50 that a man contributed and every £9 that a woman contributed bought one unit. These units would be given a value and used to calculate entitlement to an extra benefit on retirement. The scheme was intended to top up the basic State Pension, see The Basic State Pension, and ensure that pensioners had more to live on than this basic benefit alone. This early form of the earnings-related pension was later replaced by SERPS in April 1975 which has in turn been replaced by State Second Pension, or S2P. For more information on State Graduated Pension see articles on Entitlement, Calculating State Graduated Pension and Claiming and Inheriting.