Radical overhaul of pensions planned | Winston Solicitors
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Radical overhaul of pensions planned

Jonathan Winston Jonathan Winston
2 min read

The government is planning a huge transformation of the pension system which will result in everyone receiving £140 and an end to means-tested top-ups.

Work and Pensions Secretary Iain Duncan Smith and pensions minister Steve Webb, who have drawn up the plans, believe that by cancelling means testing, they will save £6bn a year and will encourage an end to a reliance on benefits. The current system sees a single person receive a pension of £97.65 a week with a married couple receiving £156.15 and means testing enabling the poorest to get an extra amount. Now, the government has proposed a simplification of the system which will see everyone getting the same amount.

The proposals would see everyone who is a British citizen able to claim the pension as well as people who had been living in the country for a number of years. It is thought that married couples and stay-at-home mothers are likely to benefit most from the changes, the latter because under the present system they have often taken time off work and have not built up enough national insurance contributions.

A spokeswoman from the Department of Work and Pensions said that the new system was being brought in through an effort to enable better understanding of pensions. She said: “The chancellor has confirmed that the government will improve the quality and accessibility of pensions in the spending review period.

“We will be bringing forward proposals for reform in a green paper later this year. Our aim will be a simple, decent state pension for future pensioners, which is easy to understand, efficient to deliver and affordable.”

The government has already announced that from April 2020 the state pension age will increase to 66 for both men and women.

https://www.theguardian.com/politics/2010/oct/25/state-pensions-reform-simplified-end-means-testing

 

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