Pension credit

Thanks Graphite, interesting.

I seem to have been lucky enough to benefit in all sorts of ways from the complicated system, without really understanding why. My state pension was small because of gaps when I wasn’t working or had paid a small stamp, with no opportunity to fill the gaps until too late. But I have benefitted since my husband died by an increase in SRP.
We were both also members of the Teachers’ Pension Scheme, and though neither of us had the full years, I now get half of his pension as well as my own.
I withdrew my contributions when I stopped work to have children, but some years later the opportunity came to pay those years back in for very little, so I took it.
I also have a tiny French pension of about £30 a month, not bad for less than a year’s working in France.
I was hard up for the first 50 years of my life, then saved hard after that, so I feel very fortunate now.

Yes, sounds unfair at the cut-off point. I agree M0nica. Have a look at the Australian Pension System. Yes, cut-off point, though if you receive at least at few cents, one is entitled to the State benefits, and lots of freebies. If however, your Assets are too high to qualify for any pension, Australia has a Commonwealth Aged Card, with no Assets Testing, to qualify for some benefits e.g. free/discounted travel, medical, prescriptions, etc.

Greciangirl

Definitely if you’re on the old state pension, you qualify for PC.

It’s way below the newer SP. Which I think is unfair.

I'm on the old state pension and get more than the new pension.

theworriedwell

Greciangirl

Definitely if you’re on the old state pension, you qualify for PC.

It’s way below the newer SP. Which I think is unfair.

I'm on the old state pension and get more than the new pension.

That must be because of additions as the basic old State Pension is £176.45 per week for 39 years of contributions (women) 44 years of contributions (men). Many women, for various reasons, will not get the full amount.

The new State Pension is £230.25 per week for 35 years qualifying years.

Yes I get more because I wasn't contracted out and earned enough
I know people who get more than I do, people on the new pension won't get anywhere near as much as someone I know who is getting over £300 a week.

If you didn't make enough contributions or contracted out then you will get less.

M0nica

Allira

The other thing to note is that those who may have an increased old State Pension paid for it in other ways ie by having a reduced works pension.

That was not through choice btw

Manythose of us old enough to get the OSP were frequently barred from occupational pension schemes because we worked part time, or were returned all contributions when we left work because we had not been in the pension scheme long enough.

I lost the equivalent of 12 years occuptional pension through either staying in a job less than 5 years (later reduced to 2 and then abolished) and working part time for a company that barred part timers from the pension scheme. I suspect that my 'lost' pensions could have amounted to several £000s a year. A very useful additionn to my income

Does this apply equally to men when they changed jobs?

Greciangirl

Definitely if you’re on the old state pension, you qualify for PC.

It’s way below the newer SP. Which I think is unfair.

Not definitely though, some people on the old basic pension get more than those on the new state pension because of the old system of SERPS whereby they get an extra payment on top of the basic pension which is related to their earnings when they were in work. Some of us were contracted out of SERPS, especially public sector workers enrolled in a pension scheme.

Norah

M0nica

Allira

The other thing to note is that those who may have an increased old State Pension paid for it in other ways ie by having a reduced works pension.

That was not through choice btw

Manythose of us old enough to get the OSP were frequently barred from occupational pension schemes because we worked part time, or were returned all contributions when we left work because we had not been in the pension scheme long enough.

I lost the equivalent of 12 years occuptional pension through either staying in a job less than 5 years (later reduced to 2 and then abolished) and working part time for a company that barred part timers from the pension scheme. I suspect that my 'lost' pensions could have amounted to several £000s a year. A very useful additionn to my income

Does this apply equally to men when they changed jobs?

Of course not!

Unheard of for a man to be generously awarded a marriage gratuity or baby bonus and their own contributions refunded to them. 😀

LOUISA1523

This is why a small pension is often not worth having ....my MIL had no pension other than state....she had her rent and council tax paid and a whole host of other things....thats just the way it is....there is a cut off point and thats that....I think younger people now consider this and think why bother ...especially if they rent ..

If enough of the younger generation "don't bother" earning their own living and retirement pension, there probably won't be any state benefits or state pension.

The rules governing repayment of contributions if you had been with a company less than 5 years and in relation to part time workers applied equally to men and women.

But given these rules applied 40-50 years ago, Most men then were in full time work, not part time work and women usually stopped work when they had children so were disproportionately represented among those leaving jobs after working for a company for less than 5 years and they also formed the bulk of part time workers.

M0nica

The rules governing repayment of contributions if you had been with a company less than 5 years and in relation to part time workers applied equally to men and women.

But given these rules applied 40-50 years ago, Most men then were in full time work, not part time work and women usually stopped work when they had children so were disproportionately represented among those leaving jobs after working for a company for less than 5 years and they also formed the bulk of part time workers.

I thought men who switched jobs were represented in those leaving or changing jobs. Thus many people have been impacted by differing rules.

Allira, may I ask who received a marriage gratuity, or a baby bonus?
Please understand that I am not being in any way provocative, I am simply saying that I have never heard of such things.

Norah It depends what you mean by switching jobs. If you moved around different jobs within a company where everyone is covered by the same pension scheme, then you would be unaffected. If you worked for a holding company with multiple subsiduaries, each with its own pension scheme. I would imagine the holding company would have had rules in the various pension schemes that covered this.

chololatelovinggran. baby bonuses in particular were quite common, especially in banking, teaching and the civil service.

I am sure others on GN, who did receive them will be able to tell you more.

Chocolatelovinggran

Allira, may I ask who received a marriage gratuity, or a baby bonus?
Please understand that I am not being in any way provocative, I am simply saying that I have never heard of such things.

Local Government and Civil Service.

It absolved them of any future pension commitments of course!

I should add that the NHS was also very wily regarding women ad their future pensions because, at the Authority I worked for at a time when first married, we were lied to and told we had to pay the Married Women's stamp, causing a shortfall in the old State Pension many years later.

I suspect that a lot of differences of opinion come from the way people are defining a pension. To me, it is a gratuity for a lifetime of work, not a benefit for reaching a particular age. If someone has worked for a company for decades it is not unreasonable to expect to be paid a smaller amount in older age when working is no longer possible. The State Pension formalised the way in which benevolent employers behaved, and rolled it out to everyone in work so that people weren't destitute in older age. Rather than impose a charge on employers, NI contributions were used to pay for pensions, with qualifying periods and payments commensurate with contributions.

Nowadays a lot of people see pensions as a right rather than a recognition of years of working, and get angry when they see those who have paid in more for longer getting more back, and some expect to be paid a 'pension' with few contributions from work, or when the ones they did make were at a lower rate.

There have been numerous changes to the way SPs have been managed over the years, and inevitably there are people getting different amounts that they have been able to claim at different ages. It can seem unfair to see others getting more than oneself, but it is fair if we all get what we paid for and it stays the same (in real terms) as we were led to expect at the start. I do think that it is wrong to make changes that apply to those already in a scheme (eg the raising of the pension age by 6-8 years) as it can be impossible to make changes to financial planning that were made in good faith.

It is reasonable for women to be annoyed at the way we have fallen behind men because of historical laws and culture that meant we are less likely to have full contributions than male colleagues. I think a lot of people still don't fully recognise the link between NI payments and pensions, so are pleased when the qualifying salary for NI is raised and they don't have to pay, or are happy to keep working hours below the point at which they have to contribute. Unscrupulous employers will, of course, encourage this, so people can get to retirement age without enough contributions to get a full SP.

I think (but may be misremembering) that when I started work the Married Women's pension was being phased out, so newly married women couldn't join but those already on the scheme could continue. There was no option for me when I married, but I wouldn't have taken it if there had been - to me it was obvious that paying in less would mean getting less back, and I couldn't understand why married women should get a different deal from single ones. Back then there was also Married Man's tax allowance, and universal child benefit, so I suppose people were used to different treatment for the sexes, and of course it was perfectly legal to pay women less just for being female until the mid 70s, so maybe it wasn't as obvious then as it is now - we shouldn't forget that times change, and that we take different things for granted in different eras.

Occupational pensions are different again, and there are many reasons why the ' gender pay gap' works against women there, too, but it would be all but impossible to legislate retrospectively for those.

Given that historically there were many women who did not work long enough to get a full contribution record, there are going to be a disproportionate number of women without a full SP, or without the additional benefits that the OSP brings to many who claim it. Obviously those women can't live on fresh air, but the question then is how to be fair to those who did work and pay in, and also ensure that those who didn't are provided for. It would not be fair to give everyone the same, as is so often asked for on here, as people have made such different contributions.

I wonder whether there should be more separation between pension and benefits when it comes to older people, with a pension being a recognition of years of work and a repayment of years of contributions to the pension element of NI, and benefits being sums given to those who do not have enough to live on, for whatever reason. The two things could be treated differently when it comes to amounts, ages for claiming etc, but there should be absolute clarity about the differences. There will, of course, be people who have pensions who also need benefits, and there is no reason why that should not be possible.

People should be encouraged to remain aware of their pension status throughout their lives, so nobody gets to pension age expecting to get a pension to which they are not entitled, or to resent not getting the same amount as those who have paid more in.

I think marriage and/or baby bonuses had probably died out before I started work, but my first job was in the civil service and when I left I was offered my superannuation (basically my occupational pension contributions) back as a lump sum. That offer applied to everyone who left with fewer than X years' service, and would have been to save the treasury money, as they kept their contributions and saved on the index-linking of future payments if people took the money early. It didn't just apply to women, and was not linked to marriage or childbirth, although more women were likely to leave to live near their husband's place of work than the other way round. It may be different from the bonuses people are talking about, but it sounds very similar. I don't think it had anything to do with the State Pension though. In either event, by the time I retired I had more than enough working years to cover it.

M0nica

Norah It depends what you mean by switching jobs. If you moved around different jobs within a company where everyone is covered by the same pension scheme, then you would be unaffected. If you worked for a holding company with multiple subsiduaries, each with its own pension scheme. I would imagine the holding company would have had rules in the various pension schemes that covered this.

chololatelovinggran. baby bonuses in particular were quite common, especially in banking, teaching and the civil service.

I am sure others on GN, who did receive them will be able to tell you more.

I meant actually moving to a different company, as people do many times over their work life. Begin work and change to a new endeavor.

Norah

M0nica

Norah It depends what you mean by switching jobs. If you moved around different jobs within a company where everyone is covered by the same pension scheme, then you would be unaffected. If you worked for a holding company with multiple subsiduaries, each with its own pension scheme. I would imagine the holding company would have had rules in the various pension schemes that covered this.

chololatelovinggran. baby bonuses in particular were quite common, especially in banking, teaching and the civil service.

I am sure others on GN, who did receive them will be able to tell you more.

I meant actually moving to a different company, as people do many times over their work life. Begin work and change to a new endeavor.

Pensions are usually transferable, Norah, and SP contributions are not tied to particular companies.

Rules about who can belong to occupational pensions have been loosened. I wasn't able to join one until I became a full-time permanent member of staff (which took until the age of 37). I had worked in education for 12 years by then. When I left FT work and moved to part-time consultancy on annual contracts I was able to join the USS. I think the only condition was that you had to earn more than about £5k a year, so they aren't doing all the admin for people just doing a few hours a year. Times do change.

Doodledog

Norah

M0nica

Norah It depends what you mean by switching jobs. If you moved around different jobs within a company where everyone is covered by the same pension scheme, then you would be unaffected. If you worked for a holding company with multiple subsiduaries, each with its own pension scheme. I would imagine the holding company would have had rules in the various pension schemes that covered this.

chololatelovinggran. baby bonuses in particular were quite common, especially in banking, teaching and the civil service.

I am sure others on GN, who did receive them will be able to tell you more.

I meant actually moving to a different company, as people do many times over their work life. Begin work and change to a new endeavor.

Pensions are usually transferable, Norah, and SP contributions are not tied to particular companies.

Rules about who can belong to occupational pensions have been loosened. I wasn't able to join one until I became a full-time permanent member of staff (which took until the age of 37). I had worked in education for 12 years by then. When I left FT work and moved to part-time consultancy on annual contracts I was able to join the USS. I think the only condition was that you had to earn more than about £5k a year, so they aren't doing all the admin for people just doing a few hours a year. Times do change.

My question and further explanation were not clear.

I suspect many women and men have different pensions. Things have indeed changed, for everyone, not always appearing fair.

Norah

M0nica

Norah It depends what you mean by switching jobs. If you moved around different jobs within a company where everyone is covered by the same pension scheme, then you would be unaffected. If you worked for a holding company with multiple subsiduaries, each with its own pension scheme. I would imagine the holding company would have had rules in the various pension schemes that covered this.

chololatelovinggran. baby bonuses in particular were quite common, especially in banking, teaching and the civil service.

I am sure others on GN, who did receive them will be able to tell you more.

I meant actually moving to a different company, as people do many times over their work life. Begin work and change to a new endeavor.

That is true now, which is why we now have personal pensions, but 50 years ago +/_ But, in the past, many men, in particular, would spend their whole working life with the same employer.

When I joined British Gas in 1984. In a department of 50, I and one other person were the only 2 in that 50 who had not spent our entire working lives with British Gas. This was not uncommon - then. Now it is very different

M0nica

Norah

M0nica

Norah It depends what you mean by switching jobs. If you moved around different jobs within a company where everyone is covered by the same pension scheme, then you would be unaffected. If you worked for a holding company with multiple subsiduaries, each with its own pension scheme. I would imagine the holding company would have had rules in the various pension schemes that covered this.

chololatelovinggran. baby bonuses in particular were quite common, especially in banking, teaching and the civil service.

I am sure others on GN, who did receive them will be able to tell you more.

I meant actually moving to a different company, as people do many times over their work life. Begin work and change to a new endeavor.

That is true now, which is why we now have personal pensions, but 50 years ago +/_ But, in the past, many men, in particular, would spend their whole working life with the same employer.

When I joined British Gas in 1984. In a department of 50, I and one other person were the only 2 in that 50 who had not spent our entire working lives with British Gas. This was not uncommon - then. Now it is very different

I understand. My husband never changed jobs.

I was merely curious why men are not mentioned in pension questions, I wondered 'are men are as impacted by change as women'. Seems not.

Norah, It is a historic thing now. As the law went all employees were treated the same, regardless of sex. Structurally women were more affected because they were likely to change jobs or work part time.

Also in the past a married woman need only pay a much lower insurance component of NI, on the assumption she would get her pension through her husband's contribution. I can rmeember the discussions that used to take place at work whenever someone got married, as to whether they intended to continue to pay the full stamp or the married womans one.

For me it was a no-brainer, I have always wanted to be independent and not be financially dependent on my spouse, so I continued to pay the full stamp.

M0nica

*Norah*, It is a historic thing now. As the law went all employees were treated the same, regardless of sex. Structurally women were more affected because they were likely to change jobs or work part time.

Also in the past a married woman need only pay a much lower insurance component of NI, on the assumption she would get her pension through her husband's contribution. I can rmeember the discussions that used to take place at work whenever someone got married, as to whether they intended to continue to pay the full stamp or the married womans one.

For me it was a no-brainer, I have always wanted to be independent and not be financially dependent on my spouse, so I continued to pay the full stamp.

I understand. I've never asked, good explanation.

I've never worked. Work discussions, pensions weren't my history.

I remember now when I went back to work after a few years at home raising children, I asked an older woman whether I should pay full stamp or married women’s stamp on my small salary.
Her comment was “ It’s jam today, or jam tomorrow.” In other words, pay small stamp now and have more take-home pay now ( to put jam on my bread) or pay full stamp and get a higher pension later.

When your income is small and no chance of working full time,’ jam today’ is tempting- or essential, in my case. Pension age seems a long way away when you are 27, and nobody really explains the system to you anyway.