01 January 2009 – State pension 100 years old today

One hundred years ago today the first pensioners went to the Post Office to collect a State Pension of 5 shillings a week.  In 1909 half a million people over 70 got a pension. Now they number over 12 million, with more than 700,000 people reaching State Pension age in 2009 alone.

Today the Basic State Pension is worth around four times more than the amount received in 1909. Help with fuel, Council Tax and rent plus the one-off payment of £60 on top of the regular £10 Christmas payment bonus boosts it further.

Around 12,000 people in the UK will share their 100th birthday with the State Pension this year and by 2050 we can expect 250,000 new centenarians each year – that’s a lot of telegrams!

Secretary of State for Work and Pensions James Purnell said:

“It is incredible to think that one in four babies born today could live to 100. Things have come a long way since 1909. People live longer and want more from later life. These days people can spend a quarter of a century getting their State Pension.”

“As the State Pension moves into its second century we are committed to ensuring that pensioners receive the help they need. Which is why, alongside the State Pension and Pension Credit, this winter pensioners will receive additional support through their Winter Fuel Payment and an extra £60 bonus.”

The first pension was non contributory but was means tested. Pensions Officers visited people’s houses to check how much money and what possessions they had - including the kitchen sink. People also had to prove they were of ‘good character’ before they received a penny.

Minister for Pensions and the Ageing Society Rosie Winterton added:

“Today we salute the first pension pioneers who fought to provide security for people in old age. 100 years on the State Pension continues to be a foundation of support for people as they retire and we have taken steps now to ensure this will be the case for years to come.”

DWP Press Office: 0203 267 5144
Out of hours: 07659 108 883
Website: www.dwp.gov.uk

Notes to Editors

1. The Old Age Pensions Act 1908 created a means-tested state pension of up to five shillings per week for some of the poorest pensioners aged 70 and above. To receive it people had to pass a ‘character test’. People were ruled out of a pension if they had refused work when able, made themselves poor in order to qualify, had been imprisoned or were habitually inebriated.
2. The full pension was 5 shillings (25p) for single man or woman, 7s and 6d (38p) for a married man. In today’s money that’s £19.30 and £29. By the end of 1909, there were around 500,000 pensions in payment in Great Britain.
3. Only 24 per cent of people survived to 70 in 1908. Those who did lived for just nine more years, on average. Today, 84 per cent of us make it to collect our state pension (at 60 for women and 65 for men) and live, on average, for a further 24 years - that’s a third of our lives in retirement.
4. During the last 100 years the proportion of people of working age to pensioners has shrunk considerably. One reason for reforming the system is to prevent the cost of an ageing population being passed on to future generations of working age people. At the beginning of the last century there were 10 workers for every pensioner. Today, the ratio is about four to one, and by 2050 it will be about two workers to each pensioner.
5. Pensioners are set for a £4 billion boost in 2009 with the biggest rise in the Basic State Pension since 2001, on top of £900m in Christmas Bonuses.
6. From April 2009, the Basic State Pension will go up by 5%, ensuring someone on a full pension will see their weekly income go up from £90.70 to £95.25. Pension Credit will also increase by the highest amount ever, up from £124.05 to £130 per week for a single pensioner.
7. For more information on pension reform go to http://www.dwp.gov.uk/pensionsreform/
8. For information on the state pension and other benefits go to http://www.pensionservice.gov.uk/