Annual adjustment and purchasing power loss (PPL)
Pensions and allowances are adjusted annually with a view to protecting beneficiaries’ purchasing power and taking into account the financial balance of the Fund.
A purchasing power loss mechanism is in place such that an annual adjustment is not granted or is slowed down until individual beneficiaries have accumulated a purchasing power loss of 8%. Thereafter Geneva Cost of Living (CVI) is granted.
There are different methods for calculating the annual adjustment and these are described in Annex C of the Fund’s Rules. The applicable method depends on your personal situation and particular dates. To determine which method is relevant, please refer to the following guidance:
- If you are a beneficiary of a retirement or total disability pension, the date that you became a beneficiary corresponds to your pension start date.
- If you are a beneficiary of a surviving spouse’s pension or an orphan’s pension, the relevant date is the date when the deceased beneficiary became a beneficiary.
- If you are a beneficiary of a retirement pension having participated in the Progressive Retirement Program (PRP), the date you became a beneficiary corresponds to your PRP start date.
- If you are a beneficiary of a surviving spouse’s pension or an orphan’s pension following the death of a member, the relevant date is your pension start date.
Should your date be:
- on or before 31 December 2011, the applicable method would be I. 1. of Annex C.
- between 1 January 2012 and 31 July 2019 the applicable method would be I. 2. of Annex C.
- on or after 1 August 2019, the applicable method would be I. 3. of Annex C.
Each year, as a beneficiary, you receive a letter with details of your annual adjustment and individual PPL account balance.