The Government has delayed publishing its plans for a single flat-rate pension as ministers struggle with unravelling the complexities of the current scheme. It is proposed that a white paper will now be published in the Autumn.
In April 2011 the Department for Work and Pensions published a green paper outlining plans to introduce a flat-rate pension of £140 per week for future pensioners. In March's budget Chancellor George Osborne said further details would be published in the spring.
Years of tweaks and reform have left the UK state pension one of the most complicated in Europe with many receiving top-up benefits to their basic state pension to provide a liveable income.
Currently state benefits for retirees can include:
- Basic State Pension
- Additional State Pension, also known as SERPS
- Increased State Pension for over 80s
- Pension Credit - means tested for those on lower incomes
The Basic State Pension currently increases each year by the highest of:
- growth in average earnings
- prices increases or
- 2.5 per cent
Quote : “The Basic State Pension currently increases in line with the Consumer Prices Index (CPI)”. With respect that’s not correct Mr. Fahy. The annual uplift is currently the greater of CPI or 2.5%
Steve thanks for spotting that – it was a typo as can be seen from my post:
‘How much will my basic state pension increase by’
But just to be clear it is not just based on CPI and 2.5%.
The correct rate of increase the higher of:
growth in average earnings
prices increases (based on the previous September’s CPI) or
2.5 per cent