25th November 2015
Women due to retire next April with what they say is an unfairly low state pension have won no concessions from the Chancellor in his Autumn Statement.
Campaigners say they have received far too little notice about the increasing retirement age, and the impact of the single tier state pension.
The Chancellor today announced that the flat-rate state pension would be set at £155.65 but many will receive much less.
Many women will not have the 35 years in work to qualify for the full amount and may not have the resources to buy additional years.
Chris Wagstaff, head of pensions and investment education at Columbia Threadneedle Investments says: “Triple locked basic state pension up 2.9% in April to £119.30 per week means 80% of those reaching state retirement age in 2016 will be worse off with new state pension.
“No measures to increase full eligibility to ‘missold’ single tier state pension beyond current 38% of those reaching SRA in 2016
“No softening of transitional arrangements for women born in the 1950s affected by accelerating SRA from 60 to 65 seems very unfair.”
Alan Higham, retirement expert and founder of Pensionschamp.com, says: “The new State pension will be set at £155.65 peer week, but only 20,000 out of 90,000 women reaching state pension age next year will actually receive it.
“There should be around 320,000 women reaching pension age in any one given year, but women’s state pension age is being moved rapidly back from age 63 to age 66 for women born between 5 April 1953 and 6 September 1954.
“In many cases women in their late 50s are just finding out that they have to wait six years longer for their state pension than they had expected.”
Higham says that today it was revealed that the Department of Work and Pensions failed to act on research findings which showed that a large number of woment were unaware of how the changes would affect them.
Higham says DWP research in 2004 showed that 57% of women impacted by the move from pension age 60 to age 65 resulting from the 1995 Pensions Act were unaware of it. Awareness was much lower amongst the more vulnerable groups of women not in work or without any private pension.
Higham says: “Shamefully, the DWP took no further action until 2009-2011 when it started to write to some of the affected women.
“The level of awareness of state pension age changes amongst vulnerable women was not disclosed in the impartial, independent briefings given to MPs and peers when the 2011 Pension Act was debated which further extended women’s pension ages. MPs and peers simply had no idea of how little notice women would be getting.
He adds: “Today, the Chancellor could only offer the support of mandatory weekly signing on sessions at the job centre to these women in their 60s struggling to make ends meet.
“The DWP’s handling of this affair over the years is at best incompetent and at worst negligent. The failure to disclose crucial facts taints the democratic process. It is certainly heaping misery on over a hundred thousand women left financially high and dry by improperly considered and appallingly implemented reforms. Parliament must be asked to reconsider this issue in the light of these new facts.”
Delivering his Autumn Statement today, the Chancellor said: “As a result of our commitment to those who’ve worked hard all their lives and contributed to our society, I can confirm that next year the basic State Pension will rise by £3.35 to £119.30 a week.
“That’s the biggest real terms increase to the basic State Pension in 15 years.
“Taking all of our increases together, over the last five years, pensioners will be £1,125 better off a year than they were when we came to office.
“We’re also undertaking the biggest change in the state pension for forty years to make it simpler and fairer, by introducing the new single tier pension for new pensioners from April next year.
“I am today setting the full rate for our new state pension at £155.65.
“That’s higher than the current means-tested benefit for the lowest income pensioners in our society – and another example of progressive government in action.”