Offtopic/fun » want to introduce a system that aims to make

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The New Flat Rate State Pension - Is It Worth It? Finance Articles | July 29, 2013
The reform of State Pensions gained pace earlier this year with plans being put forward by the Government to be discussed in Parliament. The second reading Cheap Phillip Lindsay Jersey , which was due on 17th June, would then mean that an MPs' committee would look at the proposals in detail. So this is not yet ratified and changes could well be made.


The reform of State Pensions gained pace earlier this year with plans being put forward by the Government to be discussed in Parliament.


The second reading, which was due on 17th June Cheap Jeff Heuerman Jersey , would then mean that an MPs' committee would look at the proposals in detail. So this is not yet ratified and changes could well be made.


So what is this proposed new single-tier State Pension all about, why is it being introduced and how will it affect you, if at all?


Key reasons why the Government want to change things are:


- The existing system is complex


- There are high levels of means-testing


- It creates inequality Cheap Justin Simmons Jersey , eg women overall tend to have a lower State Pension than men.


So they want to introduce a system that aims to make matters simpler, fairer and be easier for people to plan ahead by having more certainty about what their State Pension will actually be.


The changes:


- The proposed new pension will be ￡144 per week in today's money compared to around ￡110 per week now


- You will need 35 years National Insurance (N.I.) contributions, not 30 as is the position now


- You will not qualify for any pension if you have less than 10 years N.I. contributions


- Only your own N.I. contributions will be taken into account Cheap Adam Gotsis Jersey , so no claim is eligible on a partner's working history (married couple's pension will be abolished)


- All top-up pension arrangements will cease (such as State Second Pension)


- It is possible to build qualifying years even if you take time out from working to raise a family


- You can no longer defer taking your State Pension in exchange for a lump sum


What hasn't changed:


- Your pension will rise in line with average earnings, the Consumer Prices Index or 2.5% as at present


- You will still be able to delay your pension in exchange for a higher pension


So when are these changes due to take effect?


As mentioned, although the finer detail may yet be altered Cheap Jake Butt Jersey , the current expectation is that the new higher flat rate pension will be introduced by 2017 at the earliest.