Child Benefit and Pension contributions (HRP)

MrsBartolozzi

I got a letter from CB today on an unrelated matter and in it was a leaflet which, amongst other things, said that:

From 6 April 2010 for each week that you get Child Benefit for a child under 12 you will receive weekly earnings factor credits to protect your future entitlement to the state second pension.

Also see here.

Meaning that they have scrapped the HRP which was for the person in receipt of child benefit so tehy would get NI contributions towards their pension if they were responsible for a child under 16.

Now this is the first I've heard of this. I've not had any post from them since late last year so it wasn't something I dismissed as junkmail. My youngest is 13 so I stopped recieving HRP in April and they didn't consider telling me!!
There must be loads of mums (or dads) of teenagers who only work part time and don't pay NI and so were relying on HRP to help with their pension. It's not something I've seen on the board here either and I did a search before posting this - is it something that's been hushed up?

Now I fully expect the replies from childfree people saying that parents should sort out their own pension contributions etc and I have nothing against that, but surely to not let someone know that you are removing their NI pension credits is unfair?

Robbie64

The amount of qualifying years needed for a full state pension has also reduced at the same time, from 39 years (female) and 44 years (male) to 30 years so the loss of pension credits in this instance is more than balanced by that gain.

MrsBartolozzi

Oh I don't disagree Robbie, my point was that I had not been notified that was now the case. There may be people out there that will now lose out on their pension because of the change, because they had no idea therefore didn't work more hours/ go back to work etc.

Robbie64

The new system should not mean that anyone will lose out on their pension.

Under the old system a person would have had their HRP reduce the amount of qualifying years needed to get a full state pension from 39/44 years to approx 24/29 years. Under the new system the Class 1 credits will protect about 10 or 11 qualifying years, reducing the period the person needs to work (or be covered by other Class 1 credits) from 30 years to 19 or 20 years. That is a substantial gain.