UK Politics General Discussion

[Tom]

I can't see the main state pension changing significantly, except maybe to find a way to stop it going to the significantly wealthy, but there is the argument that they paid national insurance so are entitled to it, so any mention of building up contributions will need to be removed first.
Many on middle incomes with a private pension may have planned their retirement considering the state pension and their private one together. I think any significant changes to stop some people getting a state pension at all will have to be stated now to be enacted well over 20 years in the future. the Waspi issue was first put into law 20 years before those people would have been eligible for a pension and look how well that went in the end.

At the moment I think a bigger priority would be ensuring the lowest earners are properly supported even if they don't get all the NI contributions. The pension credit benefits system probably needs some work

That NI system is flawed and awful, I accept - but ultimately it is a tax, and I cannot subscribe to entitlement based on paying tax alone.

Part of any reforms should see NI and its structure replaced.

 

[rob666]

The real crushing issue is...With an ageing population, with fewer workers paying for it all...how long before the nation goes bust because we can't pay for it all, and there are no carers around to look after all those elderly infirm?
Pension age will have to go up by a year every five years or so to pay for it all.

 

[GooseOnTheLoose]

I'm not sure if that's how it actually works.

My source is/was Gov.uk - https://www.gov.uk/new-state-pension

I've not looked at it recently, but I worked abroad a few years back, and I'm pretty certain when I looked at it back then, to understand the impact of not paying National Insurance for a few years, it wasn't 10 years of contributions to get a full state pension.

I checked it this morning, before making my posts (and checked my own record too, having freelanced). New State Pension was introduced in 2016, so you may have checked your eligibility before this. You can check your own record here:

Check your State Pension forecast

Find out how much State Pension you could get (your forecast), when you could get it and how you could increase it

www.gov.uk

I''ve reproduced relevant parts below in full. If you started making National Insurance contributions after 2016, the qualifying period extends to 35 years:

Eligibility

You’ll be able to claim the new State Pension when you reach State Pension age if you’re:

• a man born on or after 6 April 1951
• a woman born on or after 6 April 1953

If you were born before, these rules do not apply. Instead, you’ll get the basic State Pension. You may also get Additional State Pension.

Your National Insurance record:

You’ll need 10 qualifying years on your National Insurance record to get any new State Pension.

A qualifying year is one in which you were:

• working and made National Insurance contributions
• getting National Insurance credits for example if you were unemployed, ill or a parent or carer
• paying voluntary National Insurance contributions

You might also qualify if you’ve lived or worked abroad or paid reduced rate National Insurance for married women.

 

[BarryZola]

Pretty sure now it's that for pretty much everyone it's 35 years for the FULL new pension which is currently £221 a week or whatever, but if you have 10 years you'll still get a pension but it'll be somewhat less than the FULL pension. Not worth worrying about anyway as you'll most likely get it made up pretty much anyway unless you're already pretty loaded. Just make sure you get at least 10 years though, as if not, currently that means you're not entitled to a pension (although realistically they're not going to let you starve, at the moment, anyway).

 

[GooseOnTheLoose]

Pretty sure now it's that for pretty much everyone it's 35 years for the FULL new pension which is currently £221 a week or whatever, but if you have 10 years you'll still get a pension but it'll be somewhat less than the FULL pension. Not worth worrying about anyway as you'll most likely get it made up pretty much anyway unless you're already pretty loaded. Just make sure you get at least 10 years though, as if not, currently that means you're not entitled to a pension (although realistically they're not going to let you starve, at the moment, anyway).

The 35 year rule only comes into play if your National Insurance record started after April 2016, usually meaning that's when you had your first job and made your first payments. For anyone who started work before April 2016, and who were born on or after 6th April 1951 (1953 for women), you only need 10 qualifying years.

In both scenarios you would be entitled to the full amount of new State Pension.

If your National Insurance record started after April 2016​

If your National Insurance record started after April 2016 you will need 35 qualifying years to get the full rate of new State Pension.

Source: https://www.gov.uk/new-state-pension/what-youll-get

If you haven't met your qualifying years, your new state pension will be reduced accordingly and you won't get the full amount. It will be topped up though, via Pension Credit, to £218 (based on other income requirements stated above).

 

[Matt N]

I’m not sure that’s right, or at least doesn’t seem it. My nan, who was born in 1956 and definitely started making NI contributions long before 2016, was working off of the rule of 35 years, because she had to pay a considerable lump sum (somewhere in the low thousands) to top her pension up to the full state pension rate. She isn’t sure why this was, as she insists that she worked and paid NI contributions for at least 35 years cumulatively (albeit in a number of different places).

 

[pluk]

As one of the first real headline grabbing decisions since election, that wasn't either explicitly or implied as likely to happen before the vote, it doesn't feel very Labour. I'm all for it though. Means testing before distributing the money we have all contributed should be an absolute given.

 

[GaryH]

We can talk about it as much as we want, but not being retired, and many of us being years away from retirement wont be affected by this (and dare I say, some wont care), but those close to the threshold already, or on full state pension but living alone, will find it more difficult this and subsequent winters to heat their homes, on top of paying the rest of the bills.

I'm not against the idea and I have always said from the outset, the winter fuel payments is something that could save money - but, it should have been targeted at those living abroad, and those with substantial savings/private pension for whom this reduction would have minimal impact. Doing it this way I feel will push more pensioners who are just about getting by further into poverty and could cost lives if we have a bad winter and a substantial (as predicated) rise in energy bills.

 

[BarryZola]

The 35 year rule only comes into play if your National Insurance record started after April 2016, usually meaning that's when you had your first job and made your first payments. For anyone who started work before April 2016, and who were born on or after 6th April 1951 (1953 for women), you only need 10 qualifying years.

In both scenarios you would be entitled to the full amount of new State Pension.

Source: https://www.gov.uk/new-state-pension/what-youll-get

If you haven't met your qualifying years, your new state pension will be reduced accordingly and you won't get the full amount. It will be topped up though, via Pension Credit, to £218 (based on other income requirements stated above).

Pretty sure you're wrong, but I'm at work so can't go through the fine detail yet. Will apologize later if it turns out I'm wrong. You're not getting the top wack pension if you contribute less than 35 years currently (and this has been the case for the last couple of decades or whatever).

 

[jon81uk]

We can talk about it as much as we want, but not being retired, and many of us being years away from retirement wont be affected by this (and dare I say, some wont care), but those close to the threshold already, or on full state pension but living alone, will find it more difficult this and subsequent winters to heat their homes, on top of paying the rest of the bills.

If someone is living so close to their means that not getting £500 this winter is causing them hardship then I think they should be supported better, but this I think is a failing in the wider pensions credit and benefits system, not the winter fuel one. In my opinion those people who don't have savings or other pensions on top of the state one should already be acknowledged and supported.

 

[GooseOnTheLoose]

We can talk about it as much as we want, but not being retired, and many of us being years away from retirement wont be affected by this (and dare I say, some wont care), but those close to the threshold already, or on full state pension but living alone, will find it more difficult this and subsequent winters to heat their homes, on top of paying the rest of the bills.

I'm not against the idea and I have always said from the outset, the winter fuel payments is something that could save money - but, it should have been targeted at those living abroad, and those with substantial savings/private pension for whom this reduction would have minimal impact. Doing it this way I feel will push more pensioners who are just about getting by further into poverty and could cost lives if we have a bad winter and a substantial (as predicated) rise in energy bills.

I believe she was contracted out, which would have effectively reduced her National Insurance contributions for state pension, but did go into a private pension. This practice stopped in 2016.

What contracting out was:

Under the State Pension rules before 2016, you or your workplace or private pension scheme could choose to ‘contract out’ of the Additional State Pension. The Additional State Pension was also known as State Second Pension or ‘SERPs’.

If you were contracted out of the Additional State Pension, some of your National Insurance contributions were either:

• lower than people who were not contracted out
• paid into another pension, for example a workplace or private pension

All contracting out stopped on 5 April 2016. After this, all National Insurance contributions are at the standard rate until you reach State Pension age.

Source: https://www.gov.uk/contracted-out

 

[pluk]

those close to the threshold already, or on full state pension but living alone, will find it more difficult this and subsequent winters to heat their homes, on top of paying the rest of the bills.

Sorry if I'm missing something, but what is it about the method of means testing that is an issue for you? There will always be a cut off point, and those nearest that cut off point will always be the 'worst' off, you can't forever move upwards from that point as you end up with no upper limit or means testing again.

 

[GooseOnTheLoose]

Pretty sure you're wrong, but I'm at work so can't go through the fine detail yet. Will apologize later if it turns out I'm wrong. You're not getting the top wack pension if you contribute less than 35 years currently (and this has been the case for the last couple of decades or whatever).

You know what, I'll save you the trouble. It's me on this rather hot day who has missed a key detail and slightly misunderstood. For this I am sorry

10 years is required as minimum to qualify, with 35 years of National Insurance contributions (or NI credits) required to get the full amount (£221). As long as you meet the minimum, your pension will be topped up with pension credit to meet £218 if you don't qualify for the maximum rate. The 35 year rule in this instance, is based on the minimum amount of monthly NI contributions required to meet the threshold, which would take 35 years. You can make additional payments if you wish, or be on a higher rate, which will reduce the time required to meet the threshold for the maximum pension amount.

The other 35 year rule (which is why I was getting confused, who has two rules with the same common name?!); if you started work after 2016, you need 35 years minimum to qualify.

In the case of @Matt N's grandmother, contracting out would explain why although she had 35 qualifying years (or more) of National Insurance contributions, she didn't qualify for the full rate and had to top it up.

Essentially, depending on a lot of individual circumstances there aren't many hard and fast rules.

Now, where did I leave that humble pie?

🪿

 

[GaryH]

Sorry if I'm missing something, but what is it about the method of means testing that is an issue for you? There will always be a cut off point, and those nearest that cut off point will always be the 'worst' off, you can't forever move upwards from that point as you end up with no upper limit or means testing again.

Means testing is fine, no issue with it - but what people are paid must provide people with a decent standard of living without hardship and the amount paid should increase enough each year to cover the cost of living. This doesn't just apply to pensioners, but anyone who is subject to means testing. But again, going back to my initial point, instead of hitting all pensioners not having pension credits, in my view they should have taken the winter fuel payment from those with substantial savings, or private pension, and those living abroad.

 

[jon81uk]

Means testing is fine, no issue with it - but what people are paid must provide people with a decent standard of living without hardship and the amount paid should increase enough each year to cover the cost of living. This doesn't just apply to pensioners, but anyone who is subject to means testing. But again, going back to my initial point, instead of hitting all pensioners not having pension credits, in my view they should have taken the winter fuel payment from those with substantial savings, or private pension, and those living abroad.

But again, this is the issue with pensions credit, that already has those checks, it can't go to those abroad or with more than £10k savings. The issue is if you are already getting the full state pension you won't get anything on top of that, unless you also get other benefits.

 

[GooseOnTheLoose]

in my view they should have taken the winter fuel payment from those with substantial savings, or private pension, and those living abroad.

Are you counting fixed assets as savings, or only liquid? What happens if someone owns their flat or house? A single bedroom property where I am will fetch £180,000, at the low end. Everyone has the option to release equity in their home at the current market value.

If you don't own your own home, are of state pension age, in receipt of full pension payment, and are claiming housing benefit you will still qualify for Winter Fuel Payments. This is because those in receipt of housing benefit, and of state pension age, qualify with that alone.

 

[rob666]

The main point to be made here is...
Never take pensions advice from strange creatures on rollercoaster sites.

 

[BarryZola]

The 35 year rule only comes into play if your National Insurance record started after April 2016, usually meaning that's when you had your first job and made your first payments. For anyone who started work before April 2016, and who were born on or after 6th April 1951 (1953 for women), you only need 10 qualifying years.

In both scenarios you would be entitled to the full amount of new State Pension.

Source: https://www.gov.uk/new-state-pension/what-youll-get

If you haven't met your qualifying years, your new state pension will be reduced accordingly and you won't get the full amount. It will be topped up though, via Pension Credit, to £218 (based on other income requirements stated above).

Home from work and have been looking around. The link above does not in any way state that you will get the FULL new state pension if you only contribute the minimum 10 years. The 10 years is the lowest amount that you need to have contributed to get 'some' state pension. You will only find it stated clearly that you need 35 years to get the FULL new state pension. It appears to work on a sliding scale of how many years you've paid in between 10 and 35 years which will determine how high on that scale from very low up to the full £221 you would get. For example, and plucking figures out of the air, if you contributed 15 years you might get £90 a week, but then if you contributed for 27 years you might get £175 a week (not exact percentages, I know).

This appears to be confirmed on many other websites such as citizens advice etc who pretty much all state that 10 years is the minimum amount to start getting 'some' new state pension and to guarantee to get the FULL new state pesnion you'll need 35 years of contributions. On none of my searches did I find it anywhere say that after 10 years you'd be entitled to the Full amount of new state pension. Just to clear that up

 

[Matt.GC]

About bloody time they means tested the rediclous winter fuel bribe. It was New Labours way of using tax payers money to buy the grey vote, then continued by the Tories.

A brave government, making such a pragmatic decision whilst the country attempts to emerge from the decline of the last 16 years. It wasn't ethically acceptable to stuff well off people's mouths full of gold in the good times, let alone now. If we can't afford to abolish the 2 child benefit cap to lift thousands of children out of poverty, then we certainly can't afford to subside middle class 68 year olds to shop in Waitrose every week.

 

[rob666]

The two child benefit limit is tricky, but was a simple unearned income source for many to avoid work.
Next door but two have had eight kids in a row, with a strong desire for more...yet they stopped breeding about the time the limit was put in.
The good breeders then had to go out and get jobs...both of them.
The system works, but is flawed...hence all the foodbank expansion.
We need to get the people who live their whole lives on benefits back into self support.
I have personally worked with a couple of dozen such families in my previous career, one family alone was costing the state over a million pounds a year in care and benefit costs...and they still kept breeding.
Not isolated examples, but happening in every town and city, and it needs to be paid for out of general taxation.
We are a civil society and can't force sterilisation, so the matter, a real and pressing matter, has been managed to some degree economically.
Something has to be done, the underclass can no longer be funded by the workers, there are simply not enough workers!