Introduction
Changes have recently been made to the State Pensions system. In the main, these changes will only affect you if you reach State Pension age on or after 6 April 2010.
These reforms will make it easier for people who reach State Pension age on or after 6 April 2010 to build up full State Pension provision.
These changes were introduced by the Pensions Act 2007 and the Pensions Act (Northern Ireland) 2008.
Changes to the Basic State Pension
The main changes to the Basic State Pension are:
- the number of qualifying years needed for a full basic State Pension will be reduced to 30
- just one qualifying year of contributions, paid or credited, will give entitlement to some basic State Pension
- contributions through paid work and credited contributions will be treated equally in building up entitlement to basic State Pension
- basic State Pension will rise in line with earnings rather than prices (from 2012 at the earliest)
Find out more about the changes to basic State Pension
Changes to the State Second Pension
State Second Pension will be simplified. It will provide a flat rate amount worth £1.50 a week (in 2007/8 money) for each qualifying year built up (from 2012 at the earliest).
Find out more about the changes to State Second Pension
Changes for carers
A new credit – which will count towards basic State Pension and State Second Pension – will be available to people bringing up children and caring for disabled people.
Find out more about the new carer’s credit
Changes to the State Pension age
State Pension age, which is the earliest age at which you can claim your State Pension, will go up. The first change will affect women born on or after 6 April 1950 but before 6 April 1959 and has been in legislation since 1995. The second change, in the Pensions Act 2007, will affect men and women born on or after 6 April 1959.
Find out more about the changes to State Pension age and when you will reach State Pension age
Personal Accounts and changes to occupational pensions
A Bill entered Parliament on 5th December to take forward proposed measures primarily aimed at reforming the occupational pensions system.
These reforms are designed to encourage greater participation in occupational pensions schemes. From 2012 it is planned that all eligible employees who do not have a good private pension will be automatically enrolled into either their employers’ existing pension scheme or a new savings vehicle called a personal account. To encourage participation, employees’ pension contributions will be supplemented by contributions from employers and tax relief.
Find out more about these proposed changes
Visit our glossary
for further explanation of the terms used on this page