In response to a query from a group chaired by the National Association of Pension Funds, HMRC has indicated that, in most cases, scheme pensions could not be reduced without attracting an unauthorised payments charge in the event of the Retail Prices Index measure becoming negative.

The Finance Act 2004 provides that a scheme reduction may be applied only if its application is made equally to all pensions being paid under the scheme. Most schemes have members entitled to either post-April 1997 benefits, which are calculated against the Limited Price Indexation rate (which is always positive), or GMP increases (which are also positive). HMRC has indicated that most schemes would therefore be unable to apply a uniform reduction to all pensions in payment, so would not be able to apply any reduction at all.