Petition on Why the old state pension is £200 pm less than the new

I thought I’d post this example in case it helps to clear up some of the misunderstanding about who receives what and who is or isn’t disadvantaged by the changes.

Women born in 1952 needed 30 years NIC to receive a full basic state pension.

Women born after 5 April 1953 need 35 years NIC to receive the full new state pension.

Two examples. Both women stop working when they reach state pension age.

I’m using current rates of both pensions for simplicity.

Here’s the chart for when WASPIs reached state pension age.

www.gov.uk/government/publications/state-pension-age-timetable/state-pension-age-timetable

Ann was born on 6 April 1952. She reached pension age on 6 May 2014 when she was 62 years 1 month old. She had 30 full years of contributions.

Barbara was born on 6 April 1953. She reached pension age on 6 July 2016 when she was 63 years 3 months old. She also had 30 full years of contributions (before 6 April 2016).

SERPS began in 1978, so both women would have had ample years to build a good Additional State Pension. Say both had earned £50 in Additional State Pension.

Ann’s basic state pension £156.20
Additional State Pension £50.00
Total pension £206.20

Barbara’s *starting point to calculate her new state pension £156.20
Additional State Pension £50.00
Total pension £206.20

Under new state pension provisions Barbara would receive £174.72 (£203.85/35*30) as she does not have enough contribution years to receive a full new state pension.

Her entitlement under the basic state pension is more than under the new state pension. Therefore, her pension comprises new state pension of £174.72 plus a protected payment of £31.48 giving her a total of £206.20.

So both Ann and Barbara receive the same amount of pension but Barbara had to wait a year and two months longer than Ann did to receive hers.

Had neither woman earned Additional State Pension, Barbara would receive £18.53 per week more than Ann (£174.72 - £156.20) but Ann has had the benefit 14 months i.e. 56 weeks more pension which at current rates would be £8,747. Divide that sum by the extra £18.53 per week that Barbara receives and it would take around 9 years for Barbara to catch up. It won’t take nine years if pensions continue to rise under the triple lock but the principle is the same. Overall Ann is better off in the medium term.

The same applies if both women were receiving £206.20. Barbara's pension would rise a little more each year under the triple lock as the main element of her pension is slightly higher but again Ann has had the benefit of that extra 14 months.

The earnings link part of the triple lock does not apply to the Additional State Pension element.

www.moneyhelper.org.uk/en/pensions-and-retirement/state-pension/how-does-the-state-pension-work-and-how-much-might-you-get

I’m getting the higher rate, but I had to wait an extra 6 years for it.

Are the petition signers happy to pay back their extra 6 years worth of payments? 😗

Ladyleftfieldlover

I have been reading several articles in the Guardian and there is much talk of letters and leaflets which were allegedly sent to women like me who were born in the 50s. I was born in 1953. I received nothing. I only knew about the new age limit because the Assistant Bursar, who did our pay told me. I retired just before my 60th birthday and fortunately got my work pension. I received my state pension at 63. A friend who is a couple of months younger had to wait another year. At first I thought we should have all kept an eye on the press etc. I did but there really was nothing unless it was tucked away on page 5 at the bottom.

No, I was born in 1952 and never received any letters or leaflets either.

I also get less than the full "new" amount despite the fact that I paid enough years of NI for a pension. It does seem unfair.
My sister has not worked for many years but will actually get more pension that I do because her's started after the new pension date.

Ladyleftfieldlover If you haven't already seen it, there was much discussion about it here with links and extracts from the Ombudsman's findings about the maladministration:

www.gransnet.com/forums/legal_and_money/1332731-WASPIs-Ten-Thousand-payment

I have been reading several articles in the Guardian and there is much talk of letters and leaflets which were allegedly sent to women like me who were born in the 50s. I was born in 1953. I received nothing. I only knew about the new age limit because the Assistant Bursar, who did our pay told me. I retired just before my 60th birthday and fortunately got my work pension. I received my state pension at 63. A friend who is a couple of months younger had to wait another year. At first I thought we should have all kept an eye on the press etc. I did but there really was nothing unless it was tucked away on page 5 at the bottom.

silverlining48

Callistemon I lost 5 years of pension in the same way, they just gave me back what I had paid in when I left as I was having my first baby.

Ten years of pension contributions ☹

Callistemon I lost 5 years of pension in the same way, they just gave me back what I had paid in when I left as I was having my first baby.

I mean elusivebutterfly is correct.

You are correct. The earnings link part of the triple lock does not apply to the additional state pension which will only rise in line with prices. This Research Briefing on the Triple Lock dated 6 Novemebr 2023 explains it. See section 1.4:

researchbriefings.files.parliament.uk/documents/CBP-7812/CBP-7812.pdf

Extract:

The then Work and Pensions Minister, Baroness Stedman-Scott, responded that the State Pension reforms should be looked at in the round. It is not possible to make direct comparisons between the two systems in this way. The new system has been designed so that no more money is being spent than under the previous system. Care has been taken to ensure fairness to both groups while delivering a sustainable system for the future. Although some people may get a larger amount uprated by the triple lock, they will not have access to other elements of the previous system; for example, a lower state pension age and the ability to build a higher state pension through the additional state pension.

Elusivebutterfly

Callistemon21

Cossy

Isn’t this because of “contracting out”?

No
And SERPs ??
No

The whole pension system is a mess
Yes, it is.

When I left work to have a family, ten years worth of Local Authority and Local Health Authority pension contributions were returned to me as a 'gratuity'.

It has just been pointed out to me on another thread I lost out on any extra State pension because I would have been contracted out.

No extra State Pension and no public service pension from those 10 years. There must be many other women who have lost out like that.

Callistemon21 has taught me something I never knew. I also missed out on Additional State Pension as I was contracted out in the 70s but got the money I paid in returned to me when I gave up work to have children. I don't think it would have been very much, but it would have helped.

Crafty, weren't they!

Having received my letter today about the increase in pension payments, I realise that the basic pension is going up by a higher percentage than the additional state pension percentage. I had not read anywhere about this and, as well as giving us less than expected, it makes pensions even more complicated.

Callistemon21

Cossy

Isn’t this because of “contracting out”?

No
And SERPs ??
No

The whole pension system is a mess
Yes, it is.

When I left work to have a family, ten years worth of Local Authority and Local Health Authority pension contributions were returned to me as a 'gratuity'.

It has just been pointed out to me on another thread I lost out on any extra State pension because I would have been contracted out.

No extra State Pension and no public service pension from those 10 years. There must be many other women who have lost out like that.

Callistemon21 has taught me something I never knew. I also missed out on Additional State Pension as I was contracted out in the 70s but got the money I paid in returned to me when I gave up work to have children. I don't think it would have been very much, but it would have helped.

Sorry Doodledog, have read all through the thread now. I admit saw the post and just thought, no that’s not right. Anyway we all are aware now.
I agree, women must stick together. We shouldn’t be fighting and saying you should have known, or I don’t care. I have a professional pension, not huge due to working fewer years due to my own childcare duties, but for that reason I’m not, and never will be at Pension Credit level. As for paying the new State Pension at 76, not only will no government ever agree to that, many women will die before that. There is no fair way for this awful mess to be sorted out and governments will simply wait for us all to die.

We are going round in circles now . If people read the thread before adding comments they will see that this has been addressed more than once.

Happygirl79

Surely the old state pension is less because the recipient has been receiving the pension since age 60?

And the recipient of the new state pension would have started receiving their state pension years later than 60?

Surely the old state pension is less because the recipient has been receiving the pension since age 60?

Doodledog

And that the old pension was claimed at 60 (for women) with a right to a widow’s element where appropriate.

The whole pension system is a mess, but I think there are reasons why the old pension is lower than the new. I’ll happily sign the petition though. We need to stick together on this.

But actually no. I’m on the old state pension but I didn’t receive any state pension until I was 63. I’m a WASPI woman, but affected twice. Firstly couldn’t get my pension till I was 63, and secondly because I’m on the old pension despite waiting for three more years.

Oopsadaisy1

Chardy

Women born in 1952 lost £20k by having to wait an extra two and a half years to get their state pension, and when they received it, it was at the old rate.

I was born in 1952 and I was just over 64 when I got my pension, so I wasn’t getting my old rate pension 6 years before the others on the new rate.

Sorry Oopsadaisy I can't see why you had to wait until 64 for your state pension. Am I missing something here?

Another anomaly is that the gap between old and new State Pensions will widen over the years, especially if the triple lock is maintained.

We might all have made different choices if only we'd had crystal balls, but as few of us can see into the future, all we can do is hope that we won't be penalised by the system if and when it changes, and that there will be some sort of 'sisterhood' that will fight for all of us, rather than resenting the fact that we have been systematically shafted over the years

Yes, we did what we were advised by successive governments, those governments kept changing the rules and it has resulted in different systems and a complete muddle.

I agree that we shouldn't be fighting, that it is women who seem to have suffered as a result of all these different rule changes.

Thank you for all the thanks!

Cossy. I’m not sure if you mean your dad received £200 pw in total or £200 additional but, yes, if a man was born on or before 5 October 1937 and his wife on or before 5 October 1942, she could inherit 100% of his Additional State Pension. Chart here:

www.gov.uk/additional-state-pension/inheriting

She may also have inherited some or all of his basic pension to top up her own. Steve Webb again:

www.lcp.com/widows-pensions-are-you-being-paid-the-right-amount

This takes into account that many women did not work outside the home after marriage and did not contribute to either a state or a workplace pension.

That is something else that has changed. Under the new state pension system. Partners can no longer inherit any part of the basic pension and only 50% of any Additional State Pension so again, the actuarial sums may be taking that into account.

Vera I must admit, I am no expert but only became curious about how it all worked when I met a very eldery widow, similar age to your dad, who had a far larger state pension than I do, about £330 per week. She worked outside the home for about 15 years and paid married woman’s stamp for much of that which does not give entitlement to a state pension.

I worked and paid full NIC for 44 years and receive new state pension. My late husband paid 40 years NIC but died before state pension age and after the state widow’s pension had been abolished.

Her state pension of £330 per week is mostly inherited. I inherited £9 - 50% of my husband’s additional state pension.

Of course, what she doesn’t have is much in the way of a workplace pension. She has her own but nothing from her late husband. He worked for a small employer which did not offer a workplace pension hence him paying SERPS. By contrast, I have my own occupational pension built up over 44 years and inherited half of my husband’s occupational pension so I am a lot better off overall.

It’s a lot more complicated than comparing one rate of state pension with another.

rafichagran

Jane43

I retired at 61 and received my state pension at 60, I felt lucky to be able to retire at that age and accept that my pension payment is lower than those who had to work for longer before being able to claim their pension. I won’t be signing the petition.

I have thought long and hard about this and I will not be signing the petition. I had to work six years longer, paid NI and tax and I found it hard going.
Waspi have fought long and hard as women in a particular cohort were not properly informed of the changes. I have lost 45k in state pension. If we do get any compensation because in my case, I had to work a further six years it will be meagre and the goverment are already saying how expensive this payout will be.
I think if people on the old state pension want it bought up to the same amount they will cause the Goverment to say even more how much this will cost.

I agree rafichagran as I said in an earlier post.

I carried on working over 60. I didn't pay NIC but my employer did

Jane43

I retired at 61 and received my state pension at 60, I felt lucky to be able to retire at that age and accept that my pension payment is lower than those who had to work for longer before being able to claim their pension. I won’t be signing the petition.

I have thought long and hard about this and I will not be signing the petition. I had to work six years longer, paid NI and tax and I found it hard going.
Waspi have fought long and hard as women in a particular cohort were not properly informed of the changes. I have lost 45k in state pension. If we do get any compensation because in my case, I had to work a further six years it will be meagre and the goverment are already saying how expensive this payout will be.
I think if people on the old state pension want it bought up to the same amount they will cause the Goverment to say even more how much this will cost.