This follows on from the previous blog “Illusion turns to Deception”. They are part of a thread I have been writing about ever since the current Government announced its radical move to a £140 ooops! £155 state pension. All the posts on this theme can be found by clicking on “Pensions” in the Topics list.
Both Iain Duncan-Smith, the Secretary of State for Works and Pensions and Steve Webb, the Pensions Minister have for the last four years been deliberately trying to mislead pensioners into believing that the Government is going to give them a Bonanza boost to their state pension after 2016. The illusion has been gradually unravelling ever since it was first announced:-
- First of all, it became clear that existing pensioners would not be included. Leaving them on the current significantly lower state pension (currently £113.10 per week).
- Secondly, the new pension would not be introduced until, initially 2015 and now 2016 and then only for new pensioners.
AS EVER THE DEVIL IS ALWAYS IN THE DETAIL AND THAT IS ONLY NOW BEGINNING TO BECOME CLEAR
- To qualify for the full pension you have to have 35 years of full contributions, whereas you only need 30 years to qualify for a full pension currently.
- Including National Insurance Contributions. At the full rate.
- People with Final Salary schemes and others who contracted out through SERPS will not qualify for the new full pension because they were allowed to pay reduced National Insurance Contributions.
An investigation by the Daily Mail’s Money Mail, has found that in 2016, when the new £155 pension is introduced, only 58% of new pensioners will qualify for the new pension. Given that pensioners who retired before 2014 are not included at all in the new scheme, it means that only 250,000 new pensioners in 2016 will receive the maximum weekly amount. So even in 10 years’ time more than a quarter of all pensions will still not be receiving the new pension.
One final sting in the tail yet to come is that the Government has remained remarkably quiet on the subject of the additional allowances —– winter fuel allowances, cold weather payments, free TV licences, etc. —– that pensioners receive currently. So there is probably more bad news yet to be uncovered.