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£144-a-week state pension is a 'con', says pensioners' group
The government will outline its plan for a £144-a-week state pension in a white paper today.
by Michelle McGagh on Jan 14, 2013 at 09:26
The introduction of a flat-rate state pension, slated for 2017, has been slammed as a ‘con trick’ by a pensioners’ group.
The government is expected to announce its plans for the universal pension in a white paper today. The Department for Work and Pensions (DWP) will commit to introducing a flat-rate pension of £144 from April 2017.
It is also expected to increase the number of years of national insurance contributions required to qualify for the full state pension from 30 years contributions to 35 years. A minimum level of 10 years of contributions will be needed to qualify for any state pension.
The paper is believed to contain more detail about linking the state pension age to longevity and recommend that the age be reviewed at least once during the life of each parliament and provide a minimum of 10 years’ notice before any change.
Although the government has promoted the flat-rate state pension as a boost for pensioners, the National Pensioners’ Convention (NPC) has called it a ‘con trick’ for future generations.
It said the government is asking taxpayers to pay more and work longer but offering them less in state pension than they would get now.
The current rules allow men and women to pay 30 years’ worth of NI contributions in order to get the full basic and second state pension of around £150 a week but the white paper will offer £144 a week for 35 NI contributions.
It also criticised the fact that the change in the state pension excludes existing pensioners and leaves five million pensioners on pensions that are lower than the proposed £144 a week.
The NPC pointed out that existing pensioners ‘will be left to struggle on with a low state pension and a complicated means-test pension credit which 1.8 million older people still don’t claim despite being eligible’.
The NPC is also against linking pensions to longevity as it would disadvantage the poorest in society.
‘There is considerable evidence to show that life expectancy is closely associated with income, profession and geography. Any suggestion that the state pension age should rise automatically in line with life expectancy will therefore disadvantage the poorest in society; in low paid, manual jobs and those living in deprived areas,’ it said.
Dot Gibson, NPC general secretary, said existing pensioners would lose out but ‘the outlook for future generations is even worse’.
‘What the government is trying to sell is a plan for people to pay in for 35 years, get £144 a week and have to wait at least until 68 before they can collect it. No-one should be taken in by what is little more than a con trick.’
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