"Flat rate" state pensions - deception exposed

diablo676

I heard on the Today programme that the figures for the new state pension will not be as stated by the government over recent years. I have known this for a fair while but I'm sure plenty of people won't and will have taken the misleading info at face value.


Ministers had promised to replace today's means-tested state pension, which consists of a basic payment and top ups linked to career earnings – with a single payment of at least £148.40 in today's money.

Workers were told that everyone who reached pensionable age after April 2016 would see their national insurance contributions count towards a "single tier" amount. But the first official calculations for the proposed payments show just 45 per cent of people reaching pensionable age between 2016 and 2020 will receive £148.40 or more.



http://www.telegraph.co.uk/finance/personalfinance/pensions/11338434/Less-than-half-of-workers-will-get-full-flat-rate-state-pension.html

How are people supposed to plan their retirement if they are mislead in this way ??

hugheskevi

Will not be as stated by the government over recent years

What has Government stated it will be?

In the White Paper from January 2013 on page 45 there is a very clear graph showing the proportion of pensioners receiving the full single-tier rate. I can't see any 'deception?'

How are people supposed to plan their retirement if they are mislead in this way ??

Read Government documents such as the one linked above, rather than rely on media sound-bites produced by editors with no pension knowledge?

diablo676

hugheskevi wrote: »

What has Government stated it will be?

In the White Paper from January 2013 on page 45 there is a very clear graph showing the proportion of pensioners receiving the full single-tier rate. I can't see any 'deception?'



Read Government documents such as the one linked above, rather than rely on media sound-bites produced by editors with no pension knowledge?

How many people do you know who read government white papers?

Most people will just have heard the numerous statements by politicians and taken them at face value. That is what I call deception.

"Steve Webb, the pensions minister, admitted he may have "oversimplified" the new state pension to make it more palatable to older workers.
“I think I may have been guilty of oversimplifying the new flat rate state pension,” Mr Webb told this newspaper. “But as soon as you caveat this type of thing people switch off. "


Cameron repeated the lie about two months ago.


So they were issuing soundbites for the coming election rather than giving genuine information. Even by May very few will know the truth.

hugheskevi

How many people do you know who read government white papers?

Many, although I expect my friends are not representative of the British population

A White Paper is the standard method of setting out final Government decisions. People can hardly complain if they cannot be bothered to read a very Janet and John type document, even with nice little pictures to make is accessible. Even those with a very basic understanding of our pension system can understand it.

Any time spent on a discussion forum such as this would also inform them of the main things they needed to know.

Anyone who complains they have been deceived are simply ignorant and lazy, in my opinion. All the information is readily available for anyone who puts in the slightest effort to inform themselves.

Mind you, I remember once moaning many years ago about something not being in a Budget speech which was included in the Budget Papers, and how that was not very transparent. I think the person I was talking to had a very good rebuttal that anything that is included in the main Budget response document can hardly be accused of being hidden. There is simply a limit on how much detail can be gone into, even in a Budget speech, let alone a 1 minute TV interview.

Andy_L

What is this "means-tested state pension" of which you speak?

Horseunderwater

Possibly Pension credit? No one is guaranteed that amount unless they have a minimum 35 years NI stamp paid in. PC should still exist to top up the basic due though.

roddydogs

They are if thevy no other income & no savings!

redux

I know very little about this, but on the basis of a pension forecast I received about 3 weeks ago I can see that a substantial proportion of the people retiring in the next few years will not receive that figure.

If someone has been contracted out of SERPS or graduated pension, additional state pension, whatever all the names are, the basic pension at the moment is about £113 a week.

Soon, in the new scheme, each year's contributions will add £4.24 per week.

So it looks like someone could currently have 30 to about 40 years contributions in the current scheme to qualify for the full basic, but not have enough working years remaining (7 or 8 needed) to catch up with the new full pension.

30 years to qualify for a full pension will be increased to 35, but for some people even 45 won't be enough.

Frankly I'd be amazed if the proportion retiring on full new state pension in the next few years would be as high as 45%.

greenglide

Frankly I'd be amazed if the proportion retiring on full new state pension in the next few years would be as high as 45%.

Why not?

Remember this will include people, like me, who have been contracted out for part of their working life and do manage to reach £150 or so from the old rules calculation.

And there are the self employed who will get the full nSP amount if they have 35 years contributions.

Importantly the groups who are actually worse of (as opposed to simply not better off) are very small - someone with 9 years contributions and an SPa date of 6/4/2016 will get nothing (nSP requires that you need 10 years to get anything).

Most people are complaining because others are getting more and they arent.

redux

greenglide wrote: »

And there are the self employed who will get the full nSP amount if they have 35 years contributions.

Not affording to the letter I received.

£113.10 plus an additional £6.94 from some employment years ago. Based on 33 years so far (30 years is the current threshold, about to increase to 35).

So someone similar but a bit older than me, without any additional pension, would not catch up the difference to the new pension in 8 more years, and might not have that long.

frank777

The government have our payment records - N.I, SERPS, Graduated Pension payments, contracted out (in my case Local Government) payments. If they gave an estimate based on this, there would be no issues (unless their records are incorrect) Do I have to keep logging in every month and check if my statement has been updated - my state pension is due in 2017.

Any ideas why you can't copy and paste your 12 digit User I.D on the forecast page - security - I must inform my Bank, that they are failing in their level of security.

https://secure.thepensionservice.gov.uk/statepensionforecast/