Update on State Pension changes

The government has launched a public information campaign to ensure everyone knows what the State Pension changes mean for them.

With just over 500 days to go, Work and Pensions Secretary Iain Duncan Smith and Pensions Minister Steve Webb have recently launched a major new drive to help people understand the historic reforms that will introduce a flat-rate State Pension.

According to a recent press release the reforms will tackle inequalities of the past, with women, carers, lower earners and the self-employed to benefit the most.

In the first 10 years, Department for Work and Pensions (DWP) analysis suggests that around 650,000 women are expected to benefit from the transition valuation, receiving on average £8 a week more in State Pension.

Ministers are urging everyone – and the over-55s in particular – to look at what the changes will mean for them and to secure a detailed State Pension statement so that everyone can plan accurately for retirement.

Under the new system, pensioners would in time receive around £150 a week or over if they have 35 years of full-rate National Insurance contributions, but those soon to retire will need to check what it means for them, with transitional arrangements in place as the system switch over.

Some 42% of people yet to retire admit they need to find out more about saving for retirement, while 38% concede they “try to avoid thinking about” what will happen when they stop working. And only 60% of all adults surveyed realise it is possible to take action to increase their State Pension.

Work and Pensions Secretary Iain Duncan Smith MP said:

“The new State Pension is one of this government’s boldest reforms; it will give people clarity over their retirement income, significantly reduce the means testing of pensioners and put right inequalities affecting women, low earners and the self-employed.”