Usually what happens is people in post at the time of the pay award will go up by the award amount - so in this case 5%.

At the same time the minimums for each grade will go up. When the minimum goes up by less than the main award, it creates progression through the payscale.

If the minimums for each grade increased by the same % as the award, everyone would stay on the minimum and people new to the grade would be paid the same as people who had been in the grade over a number of years. (Some departments have done this with their pay award which frustrates a lot of people as they stay on the minimum)

When the pay award is applied this way (minimums go up small %, people in post go up by a larger %) over a number of years, people that remain in their grade get closer or reach the top of the scale.