Women’s entitlement to their State Pension has been under pension reforms over the past few years. The reformations to the pension include the age of entitlement and the quantity of National Insurance credits. In 2016 there will be more changes to women’s pensions.
The State Pension age has been reformed – it is no longer 60 years old for women. It has changed to 65 years old, and is slowly increasing until it is equal to the men’s pension age of 68. The age gap has been gradually closing since 2010, there are plans to raise the pension age further after 2018, which could rise above 68 years of age.
To find out what year you’ll be eligible for your State Pension click here.
On April 6th 2016 the government introduced a new State Pension system which affects those approaching State Pension Age (SPA). Instead of a double tier system it has changed to a single tier system which means to qualify you will need a minimum of 10 years on your National Insurance record, and 35 years for a full State Pension. The amount you get is proportionate to how many years on your National Insurance record between 10 and 34 qualifying years. The value of the new State Pension is around £155.65 per week.
If for example, you have gaps in your National Insurance record you may have the opportunity to pay Class 3 National Insurance contributions. This means you’ll be eligible for a higher State Pension. Those that are self-employed or live abroad will only be able to make Class 2 payments. As at present the new single tier scheme will not distinguish between basic and additional pension. The cost of the Class 2 and 3 contributions varies each year, currently the cost for 2015/16 is:
- Class 3: £14.10 per week
- Class 2: £2.80 per week
It is important however to know whether or not you would like to or should pay National Insurance Contributions. To view your National Insurance record statement click here.
Generation of women to be affected by pension reforms
Women who are set to hit state pension age from April 2016 may be entitled to less of a pension than they were originally expected. The Coalition government introduced plans for a flat rate pension which was expected to give recipients around £148 a week. However, only a small number of pensioners will be eligible to claim the full pension in the first years of introduction.
MPs vote ‘NO’ to helping 2.6 million women transition into retirement as pension debate continues
Yesterday (24th February 2016) the Government voted ‘No’ to helping the millions of women hit by the changes in the state pension scheme. Changes to the state pension were announced in 1995, in order to bring the qualifying age for women in line with that for men by 2020.
Women’s Equality Party calls for fair pensions for women ahead of this week’s House of Commons debate
The Women’s Equality Party (WE) has called for a single rate of pension tax relief at 25% to boost savings for low earners, ahead of this week’s House of Commons debate on changes made to state pensions in 1995.
By Ellie Bridger