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Posted on 05 April 2011

Government plans for a new, simplified ‘flat rate’ pension worth £140 per week will make it easier for older people to ensure that they are getting all the financial support they are entitled to receive, according to Northern Isles MP Alistair Carmichael. 

Government proposals published yesterday set out options for reform that would streamline the existing state pension, with savings from the scrapping of the complex, means-tested system of credits used to increase the basic state pension rate. 

The Pensions Commission has described the existing state pension as one of the most complex in the world. A recent survey on attitudes to pensions found that barely 1 in 4 people agreed that they knew enough about pensions to decide with confidence how to save for their retirement. 

It is thought that the new state pension will be available to new pensioners after reforms are implemented. However, Ministers have confirmed that benefits and credits that individuals have already earned will not be affected by the changes. 

Commenting, Mr Carmichael said: 

‘It has been clear for some time that the existing state pension simply is not working for many older people around the UK.  It is no good increasing pension payments if people are unaware of the extra help available to them. The complexity of the current system has left many pensioners unaware of exactly what support they are entitled to receive. 

‘It is also wrong that men and women who have been forced to take time out from work to raise their families should be penalised as a result. The plans set out yesterday would help reduce the inequality that has seen many women receive thousands of pounds per year less than their male contemporaries. 

‘In our first year, the coalition has done more to improve the support we provide to older people in the UK than Labour managed in 13 years. Already, the government had restored the link between average earnings and pensions and yesterday’s announcement is another important step towards ensuring that pensioners receive all the help they deserve in future.’  


Posted on 05 April 2011
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