Government attempt to clear up state pension confusion

A man and woman on the phone to illustrate state pension confusion

Financial-planning-story-post-banner-1200x80New advertising campaign will aim to help retirement planners understand what they are entitled to

A new campaign has been launched by the Department for Work and Pensions, designed to clear up confusion over changes to the state pension system which come into effect next April.

Instead of the two-tier system currently in place, which offers ‘basic’ and ‘additional’ sums to pensioners, a single-tier state pension worth no less than £151.25 per week will come into effect, and will be available to men born on or after 6 April 1951 and women born on or after 6 April 1953.

The campaign, which was launched by Pension minister Ros Altmann under the tagline ‘Our state pension is changing’, will feature advertisements aimed at people who are within 10 years of retirement.

“Huge efforts have been put into reforming the mind-blowingly complicated state pension system that exists today into something that, over time, will be clearer and fairer for everybody,” Altmann said, “but the job of explaining to people how the reforms will affect them hasn’t been done well enough.

“People need to understand, so they can make the right decisions about saving and preparing for later life. One of my first actions on becoming pensions minister was to identify this priority, and I’m very pleased to now be launching this major campaign.”

In July, the government came under fire from the Labour Party when it was revealed that 100,000 fewer people than expected – just one in three – would get the full flat-rate state pension. The opposition accused the government of an “unacceptable” failure in transparency.

With state pension sums having a direct impact on many savers’ approach to their private pension pots, the government hopes the new campaign will provide the clarity needed to allow adequate retirement planning for all.

For more information on the state pension, click here

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