Understanding the New State Pension

UKParliament

Hi MSEs,

The Work and Pensions Select Committee want to hear from people on the new State Pension to be introduced in April 2016. Share your thoughts and experiences in the understanding the new State Pension inquiry.

Details of the inquiry

The Committee is focusing on the way the Government has communicated the changes, and the issues people are facing in understanding the transition to the new State Pension. In particular, the Committee is interested in exploring:

• Does the current DWP campaign to raise awareness adequately prepare individuals for the upcoming changes?
• Is the additional information provided to those approaching State Pension age (those aged over 55) sufficient?
• Is targeting the over 55s for more additional information about the State Pension reforms sufficient or should this be expanded to include a wider age range and/or other groups?
• To what extent are Department communications addressing the needs of specific groups who are affected differently, such as women born between 6 April 1951 and 5 April 1953?
• How could workplace pensions be used to signpost people to information about their State Pension?
• Should employers of those in contracted out pension schemes be providing their employees written information about the state pension reforms when contracting out ends in April 2016?
• How should the Department measure the effectiveness of the campaign?

The deadline for written submission is 30 November 2015.

Find out more

Submit your evidence
Guidance for submissions
Work and Pensions Select Committee

Thanks
Rachel

UKParliament

On 25 November from 9.30am, the Work and Pensions Committee will be holding an evidence session for their inquiry into understanding the new state pension.

The Committee will hear from the following people:

The Rt Hon. Steve Webb, former Minister of State for Pensions
Paul Lewis, BBC Radio 4 Money Box
Sally West, Income and Poverty Strategy Adviser, Age UK

You will be able to watch live or catch-up via Parliament TV.

UKParliament

On Wednesday 16 December from 9:45am, the Work and Pensions Select Committee will hold an evidence session for their inquiry into understanding the new state pension.

The Committee will hear from Women Against State Pension Inequality (WASPI) representatives on how the pension reforms affect women born in the 1950s and their views on improving communications. Pension industry specialists will also give evidence on current public understanding of the policy and offer recommendations for improvement.

At 9.45am
Anne Keen, Women Against State Pension Inequality
Lin Phillips, Women Against State Pension Inequality

At 10.30am
Kate Smith, Aegon UK
Dr Deborah Cooper, Mercer
Phil Mc Evoy, Prospect

Watch the session live or via catch-up on ParliamentTV.

bigfreddiel

The deadline passed on 30th Nov this thread is now pointless, start the results thread now please fj

neilvw

bigfreddiel wrote: »

The deadline passed on 30th Nov this thread is now pointless, start the results thread now please fj

Thread was opened a month before the deadline. Latest post just flags up the next session on 16 December.

They can't give any results until they have held all the evidence sessions and have written the report!

bigfreddiel

neilvw wrote: »

Thread was opened a month before the deadline. Latest post just flags up the next session on 16 December.

They can't give any results until they have held all the evidence sessions and have written the report!

Very misleading then

The deadline for written submission is 30 November 2015.

fj

neilvw

bigfreddiel wrote: »

Very misleading then

The deadline for written submission is 30 November 2015.

fj

Not misleading at all. That date was posted in late October.

UKParliament

The House of Commons Work and Pensions Select Committee have published a report on the New State Pension calls on the Department for Work and Pensions (DWP) to make urgent changes to the information they are sending to people reaching retirement age.

Report findings

The Committee says it has become clear over the last few months that the New State Pension (NSP) is widely misunderstood. The new system, which was introduced under the Pensions Act 2014, replaces the basic and additional pensions for people reaching state pension age from 6 April 2016. The evidence collected for this inquiry confirms that confusion over what people will receive from the NSP – and when they will receive it - is rife. The Committee is extremely concerned at evidence that State Pension statements and forecasts are confusing - and in some cases contradictory – and do not provide people with essential information.

One witness to the inquiry recounted: 'I was not aware of the 1st increase although I was sent a letter in January 2005 from The Pension Service but it contained no increase in my State Pension Age. So in 2005 I still believed I was going to receive my State Pension at 60. I was then notified by The Pension Service in January 2012, 2½ years before my 60th birthday, that I would not be receiving my State Pension until I was nearly 66.'

This interim report sets out a series of changes to statements which the Committee believes the DWP should urgently make. The Committee will be producing a further report addressing other issues, including the quality of other communications and the merits of transitional support to groups of women who have been subject to a change in state pension age.

Chair's comment

Frank Field DL MP, Chair of the Committee, said:

"Successive governments have bungled the fundamental duty to tell women of these major changes to when they can expect their state pension. Retirement expectations have been smashed as some women have only been told a couple of years before the date they expected to retire that no such retirement pension is now available.

We are also concerned about the accuracy of existing information that is being sent out to women about their state pensions entitlement. Groups representing this grotesquely disadvantaged group of women have suggested a pension entitlement notice. And so have other experts who have given evidence to the Committee. We expect the Department for Work and Pensions immediately to call into the department these witnesses, hammer out a new pension entitlement notice, and begin supplying all women with accurate information on their pension entitlement."

Read the report in full

UKParliament

On Monday 18 January, the House of Commons Work and Pensions Select Committee will question Pensions Minister Baroness Ros Altmann on the New State Pension, which comes into effect in April 2016.

The Committee will hear from:

• Baroness Ros Altmann CBE, Minister of State for Pensions
• Duncan Gilchrist, Deputy Director, Contributory Pensions, Department for Work and Pensions
• Richard Caseby, Director of Communications, Department for Work and Pensions

Purpose of the session

The Pensions Minister is expected to be asked about her views on the issues raised in the interim report, and what changes the Department of Work and Pensions intends to make to the entitlement statements it sends out. Other issues expected to be put to the Minister include:

• concerns about the differential impact on women born between 6 April 1951 and 5 April 1953
• awareness of state pension age changes, as highlighted by the Women Against State Pension Inequality (WASPI) campaign group;
• groups that will be worse off under the new system than they would have been under the old system;
• the DWP’s readiness to implement the NSP, and its ongoing communications strategy.

Watch on Parliament TV from 3.45pm.

UKParliament

The House of Commons Work and Pensions Select Committee have published a report on the impact of communication regarding the new state pension.

Report findings

With weeks to go before the introduction of the New State Pension, the Work and Pensions Committee says the realities of the impact of the policy on different groups have been poorly communicated to the point where even those who will be better off—and many will—do not necessarily know that.

Where the Government has sent a clear message, about the flat rate amount to be paid, it has been oversimplified so that many people incorrectly believe that is the amount they will receive, when in the fact the picture will be much more complex for many years to come.

Only 13% get flat rate in first year

Only 13% of those reaching state pension age in the first year of the New State Pension will receive the flat rate of £155.65 a week.

The report sets out a series of case studies that exemplify the confusion over the timing and amounts of the New State Pension, and describes the different groups that stand to gain, and lose, versus what they might have expected to receive under the current system.

The losses are largely products of the simplification of an outdated and extraordinarily complex system, but that complexity makes it imperative to explain the impacts directly to those affected.

Department should contact those who stand to lose

The Committee says the Department for Work and Pensions should now write to those people who stand to receive less in the early years of the new state pension than previously or have gaps in their contribution record, and clearly set out the person's circumstances, the projected entitlements and the means of improving them.

This includes people with:

• fewer than 10 qualifying years of National Insurance contributions
• lower state pensions than they would have derived from a spouse's contributions under the existing system

Both of these groups are mainly women.

Concurrently, the Government should provide a new state pension telephone hotline service for the recipients of these letters, with experts that can discuss the strategy for increasing state pension entitlement that is most appropriate for their individual circumstances. By relying on individuals requesting a state pension statement or generating one on a website, the Government risks missing those it most needs to reach.

The Government should also send automatic, annual state pension statements to all people aged 50 and over.

Read the report in full on the Parliament website.

greenglide

I really do despair!

The UKParliament organisation rep for the House of Commons should really know better than continuing the incorrect use of the term "flat rate". A "flat rate" does imply that everyone gets the same which has never been the intention, it is "Single Tier".

The old system was never a "flat rate" for the same reason - entitlement was (and is) based on the NI history and you get the appropriate proportion of the "basic pension" (old system) or "Single Tier" (new system).

It is not that hard. Somebody should be dismissed over this.