State Pension Question

[johnny.5]

if you pay more in do you get more out per week ?

[Bazile]

//..Second, those getting the lower state pension will be eligible for pension credit//

What's the 'lower state pension' ?

[New Judge]

"What's the 'lower state pension' ?"

Presumably it's the "old" State pension, baz.

Those who became eligible for their State Pension before April 2016 have a maximum of £169.50pw, whilst those younger than that have a maximum of £221.20pw.

[Maydup]

Those who became eligible for their State Pension before April 2016 have a maximum of £169.50pw, 

plus earnings related benefit - OH receives £221pw and he is "older". 

[barry1010]

Plus SERPS and Additional State Pension and/ or Graduated State Pensionfor many

[davebro3]

So what is the justification for the £50 pw pension difference? Just askin'

[newmodarmy]

Because the schemes were different  in terms of number of years needed....used to be 30. Also some could draw pension earlier at age 60 for some rather than 66 + now. Also lower ones are boosted by pension credit which new ones on full pension won't get. I'm not saying it's fair or not as it's complicated.

[davebro3]

Seems like the old "cut off" conundrum again. Someone having worked & paid in for 45 years retires at 65 in 2015 gets £50pw less than similar person retiring in 2016.

[newmodarmy]

Yes it's an imperfect system. Why do some now have to wait until 67 when women used to get a pension at 60, why do all the last 5 years I contribute count for nothing, etc etc

Attempts are made to improve it or redefine it but there are always winners and losers....

And there's always pension credit to help some.

The best plan is to build up a private pension and savings . The state pension is a back up.

[barry1010]

As I said earlier, though, many on the 'old' state pension get a lot more than those on the 'new' state pension.

The new state pension is the same rate for everyone who paid enough NI to qualify.  The old state pension had additionals that could be opted out of if you paid in to a private or works pension.  If you opted out, you paid less NI.   If you didn't opt out you got top ups on the basic pension through SERPS, Additional State Pension and or Graduated State Pension.

Some older pensioners are getting over £580 a week  on the 'old' pension

https://www.thisismoney.co.uk/money/pensions/article-11776103/The-savvy-seniors-getting-30-000-year-state-pensions.html

[New Judge]

"plus earnings related benefit - OH receives £221pw and he is "older".

"Plus SERPS and Additional State Pension and/ or Graduated State Pensionfor many"

Yes, I was only talking about the basic State Pension. One of the reasons for he change was because many people have these “add ons” (which do not increase at the same rate as the basic amount) and calculations were – in fact still are -  

“Also lower ones are boosted by pension credit”

Only if the recipient has no other income to take the total beyond the threshold level.

But, strangely, my private pension providers do not top mine up if my payments are below a certain level. Nor are they interested in any other income I might have in order to calculate those payments. They simply pay me what I'm due according to my contributions.

And that's my point. The State "Pension" scheme is not a pension scheme. It is a system of retirement age benefits which, perversely, often gives those who have made the lowest contributions the highest payments. Those people need to be removed from the published  costs of the scheme because to  include them is misleading.

 

[barry1010]

The ones that really benefited from the state pension were those born in 1839.  The first to get a state pension without paying NI in 1909. Five shillings for a single man or woman (£30 equivalent) for those aged 70 and over.  Only 5% of the populaton qualified, it was means tested  -  only payable to those with an income under 12/- a week, and reduced if you had too much furniture. If you had been in prison or were a drunk it could be refused.

Today, nearly 14% are 70 and over.

I find this sort of social history fascinating. Apologies for deviating

[davebro3]

//Some older pensioners are getting over £580 a week  on the 'old' pension//

That must be very exceptional. Most people I talk to are getting just a little over the basic. I get £175 pw.

[barry1010]

The article says ten people get that amount, so they are exceptional.