New State Pension ignores partners

passinghamt

Thanks to all who have replied.

The green paper says that for 'option 2' - the single rate pension - there would be no recognition of marriage and no help on bereavement. Being a green paper, this could, of course, change. I hope it does.

If all we are asking for is that she gets my pension if (and only if) I die before her, is that so much to ask, given the rules we were acting under.

My wife stopped work due to illness which at the time was critical and unpredictable (and for which we asked for no benefits). When, after some years, she recovered fully, we decided to shape our lives around 1 worker rather than 2 in the household. The state encouraged us to believe this was a practical proposition. If they make this change I sincerely believe they seriously misled us. As a couple we contributed very substantially through full NICs and a lot of income tax to pensions for others. As a couple we are just asking for the state to acknowledge this when the time comes for us to be on the receiving end. This is not charity.

The argument about planning as an individual is contentious. Currently tax and NICs are for individuals, but most other benefits are for households, including pensions and pension credit. Personally I think they should make it all for households rather than the muddle we have now, and merge DWP and HMRC, but that's just my view (and let's not have that argument on this thread).

Changing fundamental rules on you for things you plan for decades in advance needs to be phased in over decades as well, otherwise there's no point in people planning. Change by all means, but take care not to let people down too drastically.

catfish50

passinghamt wrote: »

If all we are asking for is that she gets my pension if (and only if) I die before her, is that so much to ask, given the rules we were acting under.

The rules have changed, but your wife will be provided for if you die before her. She will be eligible for Pension Credit. All she needs to do is fill in a form. Is that so much to ask, given that she didn't pay NI contributions?

My wife stopped work due to illness which at the time was critical and unpredictable (and for which we asked for no benefits). When, after some years, she recovered fully, we decided to shape our lives around 1 worker rather than 2 in the household. The state encouraged us to believe this was a practical proposition.

Sorry, but I don't believe the state encouraged your wife not to work, given that you don't have children. It was her choice. Perhaps she was badly advised, as it's never wise to rely on state provision never changing.

At one time, it was much more common for women not to work, even if they had no children to look after. Times have changed, thank goodness. The state couldn't function if it failed to adapt to changes in society.

If they make this change I sincerely believe they seriously misled us. As a couple we contributed very substantially through full NICs and a lot of income tax to pensions for others.

Same for all of us.

As a couple we are just asking for the state to acknowledge this when the time comes for us to be on the receiving end. This is not charity.

No, it won't be charity, it will be a means-tested state benefit paid for by the taxpayer. There's a difference, because she'll be entitled to it. There's no entitlement to charity.

margaretclare

The argument about planning as an individual is contentious. Currently tax and NICs are for individuals, but most other benefits are for households, including pensions and pension credit.

Pension credit, because it is a means-tested benefit same as income support, is for couples. Pensions are for individuals.

You explain that your wife had a serious illness. That's similar to my first husband, who was unable to work from the mid-70s until his death aged 58 in 1992. Because he claimed sickness benefits his NI contributions were credited, and he had a full NI record at the time of his death.

I also know a woman who has been on long-term incapacity benefit. She too has had her NI contributions credited and has retired on a full state pension.

Your wife could have done the same.

Oldernotwiser

passinghamt wrote: »

If they make this change I sincerely believe they seriously misled us. As a couple we contributed very substantially through full NICs and a lot of income tax to pensions for others. .

If your wife's only worked for four years in the UK, it's hard to see how she's "contributed very substantially" by way of either NICs or income tax! Nobody contributes "as a couple" only as an individual.

Stargazer57

passinghamt wrote: »

My wife stopped work due to illness which at the time was critical and unpredictable (and for which we asked for no benefits). When, after some years, she recovered fully, we decided to shape our lives around 1 worker rather than 2 in the household. The state encouraged us to believe this was a practical proposition. If they make this change I sincerely believe they seriously misled us.

I don't believe that anyone from the 'state' would have done any more than tell you what the rules were at the time you consulted them.

Otherwise are you suggesting that a married couple might have a conversation with a representative of the state when they are say aged 25, about a retirement 40 years later and death and survivor pension some 20 years after that and no changes to these arrangements would be possible in the next 60 years?

However you may be comforted by these words from paragraph 94 of the Green Paper

"Major change such as this could not be introduced without taking into account the contributions people have made under the current system. Recognising these contributions would inevitably mean that some of the complexity of the current system, particularly related to contracting out, would continue during the transition to the single-tier pension."

This suggest to me that whatever survivor pension had accrued by the date of change would be largely protected, so any 'loss' would only relate to future accrual - which would probably be small given the words you have used to describe your circumstances.

passinghamt

I think I'd better bring my contribution to this thread to an end, otherwise one tends to go over the same ground rather repetitively. I’ll conclude with some reflections on what I feel about the proposal to ignore partners when it comes to pensions if that comes to fruition.

I entirely refute the statement that we did not contribute to the state as a couple, and find that statement offensive. Without my wife's contribution to our life together, I wouldn't have been in a position to pay as much in NICs and tax. We have always been a team, and I believe families should be allowed to be treated as such.

It isn’t clear to us why it’s always a good thing that both people in a couple are expected to work. As far as we are concerned it’s a retrograde step that the individual is now the only thing that matters. If you both want to work, great, but if not, why can’t you be a couple? Is this way of living just to be discarded as being ‘old fashioned’?

It has been suggested that my wife should have claimed incapacity benefit 20 years ago so as to get NIC credits as well as the benefit. We did without because we could afford not to take it at that time. So by taking less, we get less later. It’s a funny old world.

I'd expect the state to hold to at least key elements of what they said people were entitled to 40 years ahead. I have not complained that my wife may not now get 60% of my pension while I am alive, nor that I may well lose out on some of my 2nd state pension, nor that her retirement age has gone up to 65. I'm am concerned about her situation if I die first, and feel that changing these rules is unjust. We could have made a different decision 20 years ago, and more recently could have topped up her NICs, but given what the state said it would do for us we decided to accept what was offered - a lower and lesser benefit instead. They effectively said they would insure us for the life of the longest living one of a couple on the basis of our contributions as a couple. Is that really so much to ask?

I am a little surprised that most people on this thread think we are wrong to have had these expectations. You live and learn.

We’ll probably be OK, since we have several irons in the pension fire, and can redo our financial plans and forecasts (yes, I do have a spreadsheet covering the next 30 years – sad, I know). However, we will feel seriously aggrieved if this change is made and will need to try and work out other ways of having a belt and braces pension if I die first.

I am concerned that many other couples may well be in for an unpleasant shock, and may be less able to manage.

Thanks again for all your comments. Food for thought.

zagfles

Well you have a point about the rules being changed and having made plans around the current rules. The green paper is a consultation so I'd suggest you send your comments in - see 155 How to respond in http://www.dwp.gov.uk/docs/state-pension-21st-century.pdf Need to do so by 24 June.

catfish50

passinghamt wrote: »

It isn’t clear to us why it’s always a good thing that both people in a couple are expected to work. As far as we are concerned it’s a retrograde step that the individual is now the only thing that matters. If you both want to work, great, but if not, why can’t you be a couple? Is this way of living just to be discarded as being ‘old fashioned’?

When men were expected to be the breadwinner, wives who did go to work were underpaid because it was regarded as "pin money". This created a power imbalance, with the wife being dependent on the husband. Such a situation may suit you and your wife, but many women object to it.

I am a little surprised that most people on this thread think we are wrong to have had these expectations. You live and learn.

Think about it. What would happen to the tax base if every couple decided that only one would work?

You found it convenient to have a person at home with nothing to do but to look after you. That used to be commonplace -- they were called servants. Nowadays, not many can afford such a luxury.

passinghamt

catfish50 wrote: »

When men were expected to be the breadwinner, wives who did go to work were underpaid because it was regarded as "pin money". This created a power imbalance, with the wife being dependent on the husband. Such a situation may suit you and your wife, but many women object to it.



Think about it. What would happen to the tax base if every couple decided that only one would work?

You found it convenient to have a person at home with nothing to do but to look after you. That used to be commonplace -- they were called servants. Nowadays, not many can afford such a luxury.

Why do people use forums as a place to insult people? I just don't understand it. Is it fun, or satisfying in some way? It beats me.

The concept of my wife being a servant to me, or with nothing to do but look after me, is so laughable that I'll pretend you never said it.

Enough.

seven-day-weekend

margaretclare wrote: »

Well said, jamesd. I couldn't have put it better myself. As a woman who earned her own pension, you can tell I feel pretty strongly about this.

Same here....