SERPS stands for the State Earnings-Related Pension Scheme. It was the UK's additional state pension between 1978 and 2002, paying retirees a top-up on top of their basic State Pension based on what they'd earned during their working life.
If you worked in the UK during that period and weren't contracted out, you've probably built up some SERPS entitlement — even if you've never heard the word SERPS before. If you were contracted out, your contributions were redirected into a private or workplace pension scheme that may still be sitting somewhere with your name on it.
This guide explains exactly what SERPS was, who qualified, what it's worth today, what happened when it was replaced, and what to do if you think you have SERPS entitlement (or contracted-out funds) you've lost track of.
If you'd rather skip straight to the practical action of finding your SERPS pension, start a free pension trace. Otherwise, read on.
SERPS launched in April 1978 under the Labour Government's Social Security Pensions Act 1975. The idea was simple: the basic State Pension wasn't generous, and many workers didn't have access to a workplace pension. SERPS was an additional state pension that gave employees extra retirement income based on their earnings.
Key facts:
Eligibility: any UK employee earning above the Lower Earnings Limit for National Insurance, between 1978 and 2002
Funded by: an extra slice of National Insurance contributions on earnings between the Lower and Upper Earnings Limits
Self-employed people did NOT qualify for SERPS — only employees did
Calculated on: your "best 20 years" of earnings (pre-1988 reforms) or all years of earnings (post-1988)
Paid: as part of your State Pension once you reached State Pension age
In 2002, SERPS was replaced by the State Second Pension (S2P). In 2016, S2P was rolled into the new flat-rate State Pension. So nobody is building up SERPS today — but anyone who worked between 1978 and 2002 may still have entitlement they're owed when they retire.
There are three main reasons people end up Googling "what is a SERPS pension":
They've spotted "contracted out" on an old pension document and wondered what it means
They're approaching State Pension age and want to know what they'll actually receive
They were a member of a workplace scheme between 1978 and 2002 that opted them out of SERPS and they want to find where the money went
All three are valid reasons to dig into SERPS. The third one is the most actionable — if you were contracted out, there's a real chance you have a private SERPS pension pot somewhere with your name on it.
Between 1978 and 2016, employees could be contracted out of SERPS (and later S2P). Contracting out meant:
A portion of your National Insurance contributions was redirected from the State scheme into a private or workplace pension instead
Your employer had to provide a scheme that met certain minimum standards (a "Guaranteed Minimum Pension" or GMP)
You'd receive less SERPS / Additional State Pension at retirement, but in exchange your private pension would have a slice of NI contributions added to it
This was hugely popular through the 1980s and 90s, especially among workers in workplace pension schemes. Millions of people were contracted out without thinking too hard about it — many were enrolled by their employer automatically. The result: a lot of UK workers have a small private SERPS pot from being contracted out, often forgotten because the scheme was small or the employer is long gone.
If you see "contracted out" on an old pension statement, that's what it refers to.
We cover this in detail in our dedicated Contracted Out of SERPS guide.
The UK's additional state pension has been through three iterations:
SERPS (1978–2002) — earnings-related top-up on top of the basic State Pension
State Second Pension (S2P) (2002–2016) — replaced SERPS; favoured low and middle earners more than SERPS did
The new State Pension (April 2016 onwards) — single flat-rate State Pension; no separate "additional" component for new contributions
If you reached State Pension age before 6 April 2016, you receive the basic State Pension plus any SERPS / S2P entitlement you built up — paid together as your weekly State Pension.
If you reached State Pension age on or after 6 April 2016, you receive the new State Pension. Your SERPS / S2P entitlement is calculated as part of your starting amount under transitional rules — basically, you get the higher of (a) what you would have got under the old system, or (b) what you'd get under the new system.
In both cases, SERPS doesn't disappear. It's calculated into your State Pension. But it's not paid as a separate cheque — it's bundled in.
There's no single answer because it depends entirely on your earnings history, the years you contributed, and whether you were contracted out at any point.
Some rough orientation:
The maximum SERPS top-up was around £196 per week at its peak (early 2000s, before S2P)
Most people built up far less — typical SERPS entitlement was £20–£60 per week at retirement
For people who were contracted out, their SERPS entitlement is reduced by the years they were contracted out — but the contracted-out money sits in a private pension instead
To get an accurate number, you need to request a State Pension forecast. The forecast will show your total entitlement (basic + any additional). It won't itemise SERPS separately under the new State Pension rules but it will reflect the value.
Get your forecast at gov.uk/check-state-pension — free, takes about 5 minutes with a Government Gateway / GOV.UK One Login account.
For more on valuing your contracted-out SERPS entitlement see our SERPS Pension Calculator guide.
If you were contracted out, the NI rebate went into one of three types of scheme depending on the year and the arrangement:
Defined-benefit (final salary) workplace schemes — contracted-out salary-related (COSR) schemes. Your contracted-out years are recognised as part of your scheme service.
Defined-contribution workplace schemes — contracted-out money purchase (COMP) schemes. The NI rebate added to your DC pot.
Personal pensions — appropriate personal pension (APP) schemes. From 1988, you could contract out into a personal pension you set up yourself, often called a "Section 32" buyout policy in some cases.
The provider holding your contracted-out SERPS money is identifiable through HMRC's contracted-out records (held by a third-party administrator). HMRC's records are tied to your National Insurance number.
To find your contracted-out SERPS pot today, you (or someone tracing on your behalf) needs to:
Request your State Pension forecast to see what you're entitled to under the State scheme
Request your HMRC contracted-out records to identify the scheme(s) that received your rebates
Contact the named scheme administrator(s) to confirm your membership and current value
Note that some schemes have been wound up, acquired or rebranded — Phoenix, Aviva, Aegon, Standard Life and Royal London have all absorbed numerous old contracted-out books
The full process is covered in How to Find Your SERPS Pension.
Yes, in some cases. Between 1988 and 1994, hundreds of thousands of UK workers were sold personal pensions by salespeople incentivised to encourage them out of perfectly good occupational SERPS-related schemes. Many of these transfers turned out to be poor advice — the customer ended up worse off than if they'd stayed in the workplace scheme.
The Financial Services Authority (FSA, predecessor of the FCA) ran a major SERPS mis-selling review in the late 1990s and early 2000s, with billions of pounds in compensation paid out.
If you think you were mis-sold a personal pension that took you out of a SERPS-related occupational scheme, you may still have grounds for a complaint. We cover the rules in our SERPS Compensation & Refunds guide.
SERPS entitlement, like the rest of the State Pension, is generally personal — it dies with you. But there are exceptions:
A surviving spouse or civil partner may be entitled to inherit a percentage of your SERPS entitlement (the inheritance percentage depends on your date of birth)
A surviving spouse may also be entitled to Bereavement Support Payment — a separate DWP benefit, claimed via gov.uk
If you had a contracted-out SERPS pot in a private/workplace pension, the death benefits depend on that scheme's rules — typically a lump sum to nominated beneficiaries
For a contracted-out SERPS pot in a private pension, the rules follow the rest of the pension industry: tax-free lump sum to nominees if death is before age 75, taxed at the recipient's income tax rate if after age 75.
For more detail see SERPS Pension Inheritance & Death Benefits.
State Earnings-Related Pension Scheme. It was the UK's additional state pension between 1978 and 2002.
Yes — for people who reached State Pension age before April 2016, SERPS is paid as part of their weekly State Pension (on top of the basic State Pension). For people who reach State Pension age on or after April 2016, SERPS entitlement is calculated into the starting amount under the new State Pension rules.
No. SERPS was closed to new contributions in 2002 when it was replaced by the State Second Pension (S2P). S2P was itself rolled into the new flat-rate State Pension in April 2016. Anyone working in the UK today is contributing to the new State Pension, not SERPS.
No. SERPS was for employees only. Self-employed people paid Class 2 / Class 4 National Insurance contributions, which built up basic State Pension but not SERPS.
It means a portion of your National Insurance was redirected from the State SERPS scheme into a private or workplace pension scheme. In return, you receive less from the State Additional Pension at retirement, but the redirected money sits in a private pension pot.
Check old payslips or annual benefit statements for the words "contracted out", "COSR" (Contracted-Out Salary Related), "COMP" (Contracted-Out Money Purchase), or "APP" (Appropriate Personal Pension). Your State Pension forecast at gov.uk/check-state-pension will also show whether contracted-out periods are reflected. HMRC's National Insurance Contributions Office holds the definitive records, accessible by request or through a regulated tracing service.
If you're looking for the State Pension entitlement based on SERPS, request a forecast at gov.uk/check-state-pension. If you're looking for a contracted-out SERPS pot that went into a private/workplace pension, you'll need to request your HMRC contracted-out records and contact the named scheme administrators. We cover both in How to Find Your SERPS Pension.
The State Pension part can't be cashed in — it's paid as weekly/monthly income from State Pension age. A contracted-out SERPS pot held in a private pension follows normal UK pension access rules: usually accessible from age 55 (rising to 57 in 2028), with the first 25% tax-free and the rest taxed as income. See SERPS Lump Sum & Cash In for the full rules.
This is one of the most common situations we see. The contracted-out money exists somewhere — UK pensions don't expire — but it may have moved through several scheme administrators since you were enrolled. The tracing process combines HMRC contracted-out records with provider lookups. The Pension Tracing Service® handles this end-to-end as a free trace.
Yes — between 1988 and 1994 in particular, many people were sold personal pensions that incorrectly took them out of SERPS-related occupational schemes. The FCA (then FSA) ran a major mis-selling review with significant compensation. If you think you were mis-sold, see SERPS Compensation & Refunds.
It exists in the sense that the entitlement people built up between 1978 and 2002 is still paid out as part of their State Pension. It does not exist as an active scheme — nobody is contributing to or building up SERPS today.
SERPS was the UK's additional state pension from 1978 to 2002. If you worked during that period as an employee and weren't contracted out, you built up SERPS entitlement that's now part of your State Pension. If you were contracted out, your contributions are sitting in a private or workplace pension scheme — and there's a good chance you've lost track of it.
To check your State Pension entitlement: gov.uk/check-state-pension (free, 5 minutes).
To find a contracted-out SERPS pot: start a free pension trace — we contact HMRC for your contracted-out records and identify the scheme(s) that received your contributions.
Related reading: How to Find Your SERPS Pension · Contracted Out of SERPS Explained · SERPS Pension Calculator · How to Check Your SERPS Pension
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