Second reading and review
Another significant day for pensions.
The Pensions Bill, which has a strong focus on state pension reform, today has its second reading in the House of Commons. This will give us the chance to debate our proposals with MPs, trying to make sure that we can both achieve a consensus on the Bill and ensure its proposals are effectively scrutinised.
For those of you not familiar with the main points of the Bill a quick recap might be in order. Our proposals will make it much simpler and fairer for women and carers to build up a State Pension by recognising social contributions, they will make the State Pension more generous by restoring the link to earnings, and they will increase the State Pension Age to ensure that these changes are affordable.
Within the wider reform package we are also proposing measures to encourage occupational pension saving. The 2004 Pensions Act created The Pensions Regulator and the Pensions Protection Fund to provide greater protection for members of occupational schemes.
As we said in the May White Paper, we now need to consider how the functions of these organisations and other bodies involved in the regulation of occupational pensions, such as the FSA, fit with our reform proposals and with wider developments in the pensions market. What we want to ensure is that institutional responsibilities are arranged in the most effective way to support work-based saving. This is why we are now undertaking an Independent Institutional Review.
Today, at a National Association of Pensions Funds seminar I announced that Paul Thornton will head up this review. Paul has plenty of experience in this area. He’s currently Managing Director of Gazelle Corporate Finance and has previously been President of the Institute of Actuaries.
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This entry was posted on Tuesday, January 16th, 2007 at 3:22 PM by James Purnell and categorized in General posts.
John Pearson wrote:
Yet more administration and expense - especially to smaller business.
Yet another expense and burden which will have to be forwarded on to the customer.
Must dash - got a business to run - just thought I throw in my concerns, and I assume most other small business owners.
Posted on 17-Jan-07 at 12:21 pm | Permalink
Kathleen Metcalfe wrote:
I would like to make the point tha t I feel the married womens reduced stamp I paid was not very fair. How can a bill made in 1948 (I was only six at the time) still have relevance in todays society. Myself and thousands of other women who have worked all our life but believed we would get more than the £55 I shall receive when my husband reaches 65 next year. I have paid in some national insurance. I worked from the age of 14 in Woolworths as a Saturday assistant until I left school at 16. I worked until I was 24 until I have my first child. I married at 21 but was led to believe by my employer that a reduced married womens stamp was ok. Every married women did this. Little information was given to us by successive governments regarding the issue of how much we would receive when we retired. My friends who are divorced and whose incomes are higher than mine can get pensions off their ex husbands. I chose to stay married and feel penalised. Please try to be fair with the women of this country. We have raised the children who now pay national insurance and will for more years than some people who can get more out of the government than I ever will. Could not a labour government look at this unfairness. There are lots of us in the same boat but we have at least worked hard all our lives to contribute to the wealth of this country. Thank you for reading this.
Posted on 17-Jan-07 at 5:35 pm | Permalink
J. Hateley wrote:
I too have worked all my life and was lead to believe by my past employers that to pay the small stamp was correct. I have paid the full stamp for l9 years but will only receive £53. pension. I feel this is justly umfair.
Posted on 21-Jan-07 at 6:02 pm | Permalink
Barbara Millar wrote:
From April 2010 30 qualifying years will be required in order to claim a full state pension. In August 2008 I will be 60 and will have accrued 30 qualifying years but will only be entitled to 77% of the full state pension. My husband who will be 65 in December 2009 will have 42 qualifying years but will only receive 96% of a full state pension. This seems unfair especially in the case of my husband who will suffer a shortfall in pension for the rest of his life because his birthdate falls 4 months before the introduction of the new rules. Surely gradual phasing would be more appropriate, similar to the Government introduction of phasing when women’s retirement age was increased from 60 to 65.
Posted on 22-Jan-07 at 12:53 pm | Permalink
Alexander Leitch wrote:
You will get a poor response to your attempts to boost occupational pensions while you have means testing. We would not have even todays level if you’d told people 30 years ago tat the old age pension would be means tested
This is not counting those who will not be able to achieve a fund of £100,000 (at todays value) since they would be paying for nothing.
I believe you’ll see what people think in the Scottish elections in May.
Posted on 27-Jan-07 at 12:40 pm | Permalink
Valerie McQuillan wrote:
Having read through the ‘Pensions Reform Fact Sheet - Making the state pension fairer and more widely available’ I am not convinced by your argument that only those women who reach State Pension age and with 30 years contributions after the 5 April 2010 will receive a full pension. This will create a 2 tier pension system and deny those very people you claim you wish to help a fairer pension.
The fact sheet indicates that the cost of providing all pensioners with 30 years NI contributions a full pension after the 5 April 2010 is prohibitive. May I suggest a compromise. Yes by all means introduce these new pension rules for those reaching state pension age in April 2010, but in the interests of fairness to those you really wish to help and who reach pesionable age prior to April 2010 then they should have their pension payment reviewed at age 65 or April 2010 if already 65 and adjusted accordingly to the 30 year qualifying period for a full state pension.
Posted on 07-Feb-07 at 3:20 am | Permalink
carolyn paling wrote:
How the government has the audacity to change the system over such a short space of time beggars belief. I have worked in the NHS for 32 years and have always believed that at aged 60 I could retire and receive the state pension to boost my works pension to give myself a reasonable standard of living in retirement, which is what the government wants.Just as I am about to reach that point in my life they decide I have to work until 63years and 10months - it may not seem a lot of extra time but when you have made plans and were relying on that money it is a huge kick in the teeth. I will not have a full works pension because I chose to work part time to look after my children when they were young.That meant sacrifices at home as my husband shared their care by both of us working shifts, meaning that it left little time together.
As with other pension schemes if changes need to be made the should apply to new members joining, so that they know from the start what system is in place and they can plan ahead.
Posted on 25-Feb-07 at 2:01 pm | Permalink