Can someone explain why I don't get a full State Pension please?

Spot on Doodledog.

You are both right, and if people were told that they needed to look into things it wouldn't seem so wrong. But I'm not yet at SPA, and even when I started work the UK operated on a 'cradle to grave' safety net, which people assumed would cover them far more than people have now. Yes, those who were financially 'savvy' would be far more aware than most, and those in strong unions (more common then than now) would get good advice, but for a lot of women who worked in jobs rather than careers, and who were juggling children, running a home and all the other things expected of them, checking every box on their payslip wouldn't have been a priority. Even if it were, setting up a private pension was far more of a big deal then than it is now. It wasn't just a case of filling in a form online.

I think that a lot of women were genuinely expecting to retire at 60, and to get the full SP as well as any occupational one, simply because nobody bothered to tell them otherwise. The alternative is to believe either than a whole generation of women was too stupid to make arrangements or that there is some sort of conspiracy of lies, and I'm not inclined to think that either is the case.

Doodledog

*But you must have a local council pension instead of the full state pension. You weren’t put at a disadvantage being contracted out. You would have been paying very low NI contributions, hence the lower state pension.*
I don't think that's the point though. Many people just look at the box in the bottom right of their payslip and assume that things like tax and NI have been worked out correctly, and that they have paid all that is asked of them. If nobody has told people that (a) their pension has been contracted out, and (b) that this has implications for the state pension down the line, how are they supposed to know? It seems to me reasonable that when people see the headline figure for state pension and they have paid NI for decades they will assume that they will get the full state pension on top of whatever other arrangements they have made and paid for. Finding out just before they retire when it is too late to do anything about it must come as a blow.

I’m sure you’re right, a lot of people don’t bother to check. Technically though, it’s incumbent on us all to know from an early age once we start work exactly what we are contributing, what our employer is contributing, and what we need to do to improve our finances on retirement. The details were always there in the small print, certainly for public sector contracted out schemes, but not everybody took time to understand what it meant, maybe too much faith that it would all work out.
I think one of the positives now with portable pensions and online forecasting is that younger people seem to be much more clued up, both my children review theirs annually as they don’t want to work until 70+ and they know the only way not to is to contribute more as early as they can - their friends are of the same mindset.

I too only get the basic SP, with a big deduction for all the contracted out years. Far less than people who get the new SP. Far less even than my husband’s old SP - he was never contracted out. I know it’s unfair, having worked all my adult life and paid shedloads of NI. However my NI contributions weren’t going into a little pot with my name on it, they were paying the pensions of those who had already retired - just as my son is in effect now paying for my pension. Yes, of course I wish I received the new SP and that EL hadn’t so royally messed up my private pension, but at least I retired at 62, having reached SP age at 60. I have always said you can’t have it all ways. Never more true than with pensions.

Doodledog well said! I had 37 years full contributions and receive the minimum. I was told that I’d paid in under one system and taken my pension under another. I keep thinking I should challenge it but it all happened during COVID and I’ve an occupational pension. But it really grieves me that I get £50 a week less than women I know who’ve never worked or only done part-time after starting a family.

I'm not arguing with that, GSM. I was told at the full day induction I had when I started work, and someone from payroll talked all the new starters through it all. But by no means everyone gets that level of information from their employers, and payslips are not always transparent.

The bottom line is that the pension system is a mess. People pay in for years and get very little, others pay nothing and don't just get a pension but also things like rent and dental treatment free, a few months here and there can make a difference to which pension people get, some pay in from their teens and others don't start until their 20s - none of it is organised and clear.

I can fully understand someone assuming that they would get the full SP if they have worked and contributed for decades, and that they would also assume that the extra they have contributed to an occupational pension would be towards that alone. Thinking like that is far more logical than the actual system.

When you are contracted out, as I was for many years, the government makes payments into your occupational/private pension so (unless like me you were a victim of Equitable Life) that pension is greater than it would otherwise be. You can’t have that benefit and expect a full SP. I was always aware that this tax-efficient arrangement would be to my benefit and of course it would have been had EL not folded.

But you must have a local council pension instead of the full state pension. You weren’t put at a disadvantage being contracted out. You would have been paying very low NI contributions, hence the lower state pension.
I don't think that's the point though. Many people just look at the box in the bottom right of their payslip and assume that things like tax and NI have been worked out correctly, and that they have paid all that is asked of them. If nobody has told people that (a) their pension has been contracted out, and (b) that this has implications for the state pension down the line, how are they supposed to know? It seems to me reasonable that when people see the headline figure for state pension and they have paid NI for decades they will assume that they will get the full state pension on top of whatever other arrangements they have made and paid for. Finding out just before they retire when it is too late to do anything about it must come as a blow.

Thanks SporeRB. I've just taken a look - wish I hadn't really - and it says 27 years of full contributions and 23 years when I did not contribute enough. So that brings me close to the halfway pension mark I guessed. Fair enough, though 5 years were when I was at university?
Anyway, I now I need to work out whether it's worth bothering to pay the extra just to get an additional £20 or so a week.
Then I'll tackle the French site

LizzieDrip

Alice I think the issue will be that, as a public sector employee, you were probably ‘contracted out’ without realising it. I worked in the public sector for most of my working life and when I retired 2 years ago I had 41 years NI contributions, yet I still don’t receive the full state pension. I feel angry about this because I was never given the option to be contracted out or not - it just happened. Neither was I informed by my employer (the local council) that this would have an impact on my state pension in later years. It’s worth ringing up the pension people - that’s what I did and they explained it all to me. Too late now, of course!

But you must have a local council pension instead of the full state pension. You weren’t put at a disadvantage being contracted out. You would have been paying very low NI contributions, hence the lower state pension.

Joseann

I think that's the full amount Katyj because it's £203.85 x 4 per month. As I haven't worked 35 years in this country to qualify, my understanding is that I will get a proportion of the new State Pension. My poor Maths assumes I divide the £203.85 by 35 and then times it by the number of years I worked in the UK, which will bring me out to around half the full amount.
I don't think you have to work until you're 66 years old to actually qualify for the full amount, do you? My DH isn't there yet but is considering stopping work early.

Joseann,

Why don't you access the government gateway using your NI number to get your state pension forecast, so you know exactly how much you will get?

Like you, I have an overseas state pension. When I compare the UK state pension to my overseas state pension, I realised how much more generous the U.K. state pension is, so it is worthwhile to pay the extra NI contributions for my contracting out years to get the full state pension.

I wrote to the State pension department regarding this last year, no reply. Call several times, could not get through.

Looks like I have to badger them next year to get some answer. Not sure whether I have missed the deadline though.

Alice I think the issue will be that, as a public sector employee, you were probably ‘contracted out’ without realising it. I worked in the public sector for most of my working life and when I retired 2 years ago I had 41 years NI contributions, yet I still don’t receive the full state pension. I feel angry about this because I was never given the option to be contracted out or not - it just happened. Neither was I informed by my employer (the local council) that this would have an impact on my state pension in later years. It’s worth ringing up the pension people - that’s what I did and they explained it all to me. Too late now, of course!

I receive a higher State Pension than my OH as he was contracted out for all his working life whereas I was in and out over the years. However, we are both fortunate in having good defined benefit company pensions plus we both paid AVCs to the maximum allowed to boost our pensions.

mummytummy

www.gov.uk/new-state-pension

www.gov.uk/check-state-pension

By the time I get the state pension in 2027 if I continue to work I will have paid in for 50 years. Thankfully I have a small deferred benefit pension. Due to working in the NHS I was opted out so my state pension forecast was lower so I paid additional voluntary contributions to bring it up to the full state pension.

On hindsight maybe I should have not paid them as I may have been eligible for pension credits. However I’m glad I did and know what I’ll be getting in retirement. 😊

Anybody receiving the full new state pension is unlikely to be eligible for pension credits. The cut off point for pension credit is about the same as the full new state pension.

Sorry, contracted out not opted 😂

www.gov.uk/new-state-pension

www.gov.uk/check-state-pension

By the time I get the state pension in 2027 if I continue to work I will have paid in for 50 years. Thankfully I have a small deferred benefit pension. Due to working in the NHS I was opted out so my state pension forecast was lower so I paid additional voluntary contributions to bring it up to the full state pension.

On hindsight maybe I should have not paid them as I may have been eligible for pension credits. However I’m glad I did and know what I’ll be getting in retirement. 😊

I'm really not resentful, in fact I'm grateful that I get some State Pension (albeit 6 years after I thought I would get it!) and also to have my work pension which I paid into from the age of 18. I'm just a bit confused that there seem to be so many variations in what people receive. I know now that, working in local government for most of my life, I was contracted out - but I don't think I had any alternative as that is what the powers that be decided for me.

I'll look into asking for some advice from one of the organisations listed on the Gateway to see if it's worth me making up the shortfall as I see from my NI record online that I have four years when I haven't paid enough, or rather anything at all as I haven't been working!

Ah, I see there have been some other contributions since I posted the above...I will read carefully!

So do you think it would be worth me paying the extra years of NI? I retired in March 2019, so I think by your reckoning I am 3 years short.

The pension should either be a universal benefit given to everyone above a given age who has been resident in the UK for a given number of years, or be based on people’s own contributions, rather than something paid for only by those who work, with variations made depending on decisions made by employers that may or may not have been communicated to staff, and with the right to opt out of paying in by choosing not to work. Anyone without enough to live on should get benefits in the usual way, but with no requirement to seek work above a given age. That way, discrepancies such as we see on these threads would not be there, and there would be fewer resentments. I think it is wrong that a few months between birthdays can make a huge financial difference between people’s entitlements, and also that it is wrong for those who haven’t paid in to get the same as (or more than) those who have.

Nothing disadvantageous should come in retrospectively however, as people will have made financial decisions based on what they were told would happen, and it is unfair to move the goalposts.

I was contracted out. I get the new state pension. I lose about £30 every four weeks. I also have a occupational pension which more than makes up for it.

sf101

Contracting out only affects the extras you can get such as earnings related supplement, there were others over the years.
The reason you didn't get the full new SP is because things changed in 2016. You needed to have paid 5 years of contributions since 2016 to qualify for the full new pension. Instead you fall somewhere between the full old pension which you have paid plenty to qualify for and the full rate of the new state pension.
I was in a similar postion but only one year short and I didn't feel it was worth paying extra to make up that year for just a couple of quid a week.

It doesn't just affect extras. I have 48 years of contributions, but don't get a full pension because I was contracted out for a number of years. I have five full years since 2016 too.

Contracting out only affects the extras you can get such as earnings related supplement, there were others over the years.
The reason you didn't get the full new SP is because things changed in 2016. You needed to have paid 5 years of contributions since 2016 to qualify for the full new pension. Instead you fall somewhere between the full old pension which you have paid plenty to qualify for and the full rate of the new state pension.
I was in a similar postion but only one year short and I didn't feel it was worth paying extra to make up that year for just a couple of quid a week.

Thank you OldFrill. Good advice to speak to someone who knows. It did cross my mind to try that, as long as they dont say I'm required to live until 100 to make it worthwhile! I also need to look on the French side of things, more for DH than for me, but something tells me there is a 10 year minimum to qualify which is longer than our 6 stay. Their bureaucracy is mind-boggling too.
Looks like I'll have an interesting New Year researching this!
AskAlice from what I've quickly read you should receive the full amount.

Joseann

I think that's the full amount Katyj because it's £203.85 x 4 per month. As I haven't worked 35 years in this country to qualify, my understanding is that I will get a proportion of the new State Pension. My poor Maths assumes I divide the £203.85 by 35 and then times it by the number of years I worked in the UK, which will bring me out to around half the full amount.
I don't think you have to work until you're 66 years old to actually qualify for the full amount, do you? My DH isn't there yet but is considering stopping work early.

You may be able to top up your NI payments in order to increase your pension (investigate this asap as l think there is a limit on time to do this).
Depending where you lived outwith the UK it may count towards your state pension and/or a pension from that country.
The pension department were extremely helpful when I've spoken to them, including sending me forms to claim from another country - check out the website for contact details etc
www.nidirect.gov.uk/articles/understanding-and-qualifying-new-state-pension#:~:text=You%20will%20usually%20need%20at,and%20paid%20National%20Insurance%20contributions