New £144 Pension rate masks stealth cuts

New £144 Pension rate masks stealth cuts
The government announced last week that the basic state pension would be raised from £107.45 to £144 by 2017 for everyone and means testing for top-ups would end. Most news items said only those with high incomes, the young and those who had a contracted-out pension would be worse off.

Truth is everyone will be worse off. First of all you now need an extra FIVE years NI contributions to qualify for the £144. In addition, these NI contributions will be higher for every employee.

Then the state pension age is being raised yet again in 2026 to 67. It is then being reviewed every five years, with most believing today’s 30-year old will not get a state pension until they are aged 70 maybe older.

So on the one hand we are getting an extra £36.55 a week. (£1,900 a year) But we are having to pay in more (how much depends on your earnings) and wait longer. Raising the pension age by two years will cost everyone under 53 £11,175 at today’s rates. This will mean you would need to live until you are at least 73 to break even just to get your £11k back!

And remember those already getting a state pension before 2017 wont get the increase at all ever, so the extra NI contributions are not being used for today’s pensioners!

Re: New £144 Pension rate masks stealth cuts

Hi Elbee, I already get more than £144/week so I want them to leave my pension alone.

Re: New £144 Pension rate masks stealth cuts

£144 a week is for a single person Alan, its not for a couple.
I think there will be a explosion in the future as to pensions.
If you are doing a heavy type job you cant live until you are 70
sometimes so retiring at 70 seems ridiculous. They will have to
start being selective on the age of retirement as to the job you do.
Whether thats right or wrong I am undecided but I would hate to
see poor people never getting a pension that they had worked for.
That happened to my Dad and I always felt sorry for him as he was
always going on about when he retired he could go fishing more.
He died at 59.

Re: New £144 Pension rate masks stealth cuts

If you are already drawing s state pension the new rules do not apply anyway. I am really pleased about it as I am retiring in a few months time so won't pay much more towards it and will be able to draw the new amount when I claim my state pension in 2019.

Re: New £144 Pension rate masks stealth cuts

I realise that Sandra. At the moment I get slightly more than the £144 and Sheila gets half of what I get.

Re: New £144 Pension rate masks stealth cuts

That may be so but I am not grumbling and feel very fortunate. I drew my pension at the age of 60, and qualified for the winter fuel allowance/prescriptions etc , many have had to wait much longer.

Re: New £144 Pension rate masks stealth cuts

In 2017 the basic pension will be £144 why?? The government says we need £145.40 for a single person to live on now in Apr.2013. So are people going to need less to live in 4 yrs than now. That doesn't make sense.

Re: New £144 Pension rate masks stealth cuts

I'd like to see some of them surviving on it!

Re: New £144 Pension rate masks stealth cuts

It's a fact that we are all living for too long, and because of that there are too few people working to pay for those that have retired.

OK I know that we all think we've paid it in and that is true, but in their wisdom governments didn't save what we paid in but used it for our parents/grandparents pensions, and therefore our children/grandchildren will have to pay for ours.

We really shouldn't complain though when the NHS have kept us so healthy that we actually live too long....

Re: New £144 Pension rate masks stealth cuts

People should have private pensions as well Hazel. No-one should be totally reliant on the state pension.