Confusion about the new flat rate state pension

Wednesday 24 June 2015

• A third of over 50s say they have no idea whether they will be better off • Over 50s also unclear whether they qualify for the new pension in April 2016

Confusion about the new flat rate state pension

A Saga survey of 10,010 over 50s has shown confusion over the plans to introduce a new flat rate state pension in April 2016.

Respondents were equally divided with a third believing the new system would be more generous, a third thinking it would be less generous and the remainder having no idea. 

However, people in their 50s were less positive with just a quarter thinking it would be a more generous system. Just 16% of people in their 50s believed they would go on to receive the new pension and a third thought they would not.

The new flat rate pension is more generous for the lower paid and less so for higher earners.  However, the public perception is quite the reverse in that just 28% of those in socio-economic group DE believe the new pension will more generous compared with 36% of those in socio-economic groups AB.

Only 7% of people in their 50s said they were sure they knew about how to make extra National Insurance top up payments to secure a better state pension.

Saga is calling for the Government to write to all those approaching retirement with individual pension predictions along with a proper explanation the new system and to draw attention to arrangements that allow people to make top up payments so they can qualify for a better pension.

Saga’s Paul Green said:

“Our research shows great confusion about changes to the state pension.  Whilst there are a minority of people who are savvy who know how to make the most of what is on offer, it should not just be for savvy few to benefit.  The Government needs to do much more to raise awareness of the ways that people can boost their state pension.”

Ends

 

Notes to editors

  • * Populus interviewed 10,010 UK adults aged 50 and over, online between 14th and 20th November 2014.  Populus is a member of the British Polling Council and abides by its rules
  • The current state full basic state pension is £113.10 per week
  • The flat rate pension in April 2016 will be not less than £151.25.  This is based on a full 35 years of full National Insurance contributions (rather than 30 at present). 

 

For further information contact:

Paul Green
Saga Press Office
Paul.green.pr@saga.co.uk
01303 776023

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