State pensions: will you lose out?

Chris Torney / 11 August 2015

Britain’s State pension is undergoing significant reform at the moment. So how could these changes affect you?

The age at which people can claim their pensions is rising and in April 2016 a new flat-rate payment is being introduced to replace the current system.

State pension age

Until 2010, the age at which people could claim the State pension was 60 for women and 65 for men. Some years earlier, however, the government announced it was planning to equalise the age at 65 for both sexes.

This meant that between 2010 and 2020, women’s State pension age would gradually increase.

In 2011, however, ministers decided that the age should rise to 66 for both men and women by 2020. This means that many women who expected to be claiming their pensions between 2016 and 2020 now face a further delay.

Originally, the 2011 legislation meant that women born in April 1953 or shortly after would have had to wait around two years longer than they thought to get their pensions. But the law has been altered so that no one faces a wait of more than 18 months.

To find when you will be eligible to start receiving the State pension, visit

New flat-rate State pension

On 6 April 2016, a new State pension system will come into force. It is described as a flat-rate pension, because it will no longer be made up of the basic State pension plus any additional pension (also known as Serps or State Second Pension). There will also be less means testing of pensioners when working out benefit levels such as the Pension Credit.

Weekly payments under the new system will be more generous than the current basic State pension of £115.95 a week. The exact amount will be set in the autumn of 2015, but it is expected to be around £155 a week.

Who is eligible for the new scheme?

If you have already reached State pension age or are due to do so before 6 April 2016, you will not be part of the new scheme. This rules out men who were born before 6 April 1951 and women born before 6 April 1953.

Anyone in this group, however, will be able to make a one-off lump-sum payment between 12 October 2015 until 5 April 2017 in order to increase their weekly pensions – see here for more details.

Will I get the full amount?

Not everyone will be entitled to the full amount of the new pension. For example, if you have spent years “contracted out” of Serps or the State Second Pension – with money diverted instead into a workplace pension – your entitlement is likely to be reduced.

But if you would have been entitled under current rules to a State pension that is more generous than next April’s flat rate, you will be paid the higher rate when you reach State pension age.

How can I find out more?

Anyone who is due to reach State pension age in the first 10 years of the new system can ask for a forecast of how much they will receive – this applies to women born between 6 April 1953 and 5 June 1960 and to men born between 6 April 1951 and 5 June 1960. Call the Future Pension Centre on 0345 3000 168 or request a statement online on the government website.

Did you know that you can boost your retirement income by deferring your state pension? Find out more...

The opinions expressed are those of the author and are not held by Saga unless specifically stated.

The material is for general information only and does not constitute investment, tax, legal, medical or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.