Old and new state pension

viv0147

XYLOPHONE. Thank you for the information I have been trying to find out for a while although saying that it's not much of a conciliation but at least I now know.

mollymoneybags

'Are you arguing that existing pensioners with more than £150 p/w should have their State Pension entitlement reduced to create this baseline? Or would this just be an enhancement for some and preservation of a privileged position for the rest?’
No. I am talking about next year when the new scheme comes into play. As I wrote elsewhere, if the basic next year is £148, then existing entitlements that people have accrued- current pensioners and new ones- should be added on top of that. I’m in no way suggesting that what people already have should be nibbled away. Of course that will be a lot of money that any government won’t want to pay out, but where you argue that it would lead to an ‘unexpected windfall’ for the likes of me, and future pensioners ‘getting less’, I view it as an issue of fairness. The new basic level should simply be the same for everyone, and the Joseph Rowntree suggestion would be a good starting point –possibly less for the treasury to find, while helping to lift those with only the current basic pension out of poverty. A possible compromise….!..... It doesn’t mean future pensioners ‘get less’ – they’re only getting’ more’ because the government has proposed a possible ‘more’ for them in this new scheme.
‘And if that only adds up to about 70-80% of the actual cost…..’
Aaaah IF….Well that’s a very debatable point isn’t it? I paid my self-employed stamp and class 4 nat ins for 39 years. At the moment it seems to be 30 years, and will soon be 35 for the younger people. Most men have paid 44 years worth.. We all feel we’ve paid loads in and should get more out. But a lot of what we paid in wasn’t just for ourselves. It helped to pay the pensions of older folks- that’s part of the deal. In a civilised society we’re all helping to pay for each other, so claiming younger folks will be excessively burdened by our supposedly bloated demands is a red herring. We all contribute to the pot, and then hope the government will distribute it fairly. I’m arguing that it isn’t doing that in this instance, and in a country that is the 5th largest economy in the world, it CAN fund this increase. Describing a desire for fairness with emotional words like ‘greedy’ is not furthering the discussion…..

greenglide

I paid my self-employed stamp and class 4 nat ins for 39 years.

But NI class 2 and class 4 contributions have never qualified for pensions above the basic pension. Class 1 contributions qualify for Additional Pension (SERPS, S2P) provided you are not contracted out.

No class of NI contributions actually pays for or buys the State Pension. NI is just an employment tax and at the moment being over the lower earnings limit but below the primary threshold results in getting a qualifying years without actually paying any contributions and it gets S2P as well!

MABLE

greenglide wrote: »

But NI class 2 and class 4 contributions have never qualified for pensions above the basic pension. Class 1 contributions qualify for Additional Pension (SERPS, S2P) provided you are not contracted out.

No class of NI contributions actually pays for or buys the State Pension. NI is just an employment tax and at the moment being over the lower earnings limit but below the primary threshold results in getting a qualifying years without actually paying any contributions and it gets S2P as well!

My OH stopped working at 60 but officually retires at 65. However he get NI credits up until his state pension kicks in. I believe they are NI
Class 1 so based on that would that make any difference to the S2P amount.

molerat

No, additional pension can only be earned with income. The credits only give years on the basic pension but may add entitlement to other contribution based benefits. https://www.gov.uk/national-insurance-credits/overview