State benefits

This page sets out details of the basic state pension available to UK residents.

It also includes important information about government overpayments to pensions announced in December 2008 and advice on topping up your pension under new rules from September 2008.

Basic State Pension

Changes have recently been made to the state pensions system. In the main, these changes will only affect people who will reach state pension age (the earliest age at which you can claim your state pension) on or after 6 April 2010, making it easier for them to build up full state pension provision.

The changes were introduced by the Pensions Act 2007 and the Pensions Act (Northern Ireland) 2008. The main ones are:

  • the number of qualifying years needed for a full basic State Pension will be reduced to 30

  • just one qualifying year of contributions, paid or credited, will give entitlement to some basic State Pension

  • contributions through paid work and credited contributions will be treated equally in building up entitlement to basic State Pension

  • basic State Pension will rise in line with earnings rather than prices (from 2012 at the earliest).

State pension boost

If you are concerned that you have not paid enough National Insurance (NI) contributions to qualify you for a full state pension, you may now be able to top-up your contribution level more than before, the government has announced.

If you are to reach state pension age between April 2008 and April 2015 (until 2010 men at age 65, women age 60; after that gradually rising to age 65 for women), and already have 20 years on your NI record, you will be able to buy back up to 12 years of missing NI contributions. This is compared to up to six years under previous rules.

Ninety per cent of the estimated half a million people to benefit from this will be women, whose employment records are often patchy because of periods of non-working. It is usually very good value to 'buy' these contribution years as the value of what you get in state pension will be much more than it costs you.

However, some critics have warned that the cost of buying each of these years will be higher than normal and argue that the government has not gone far enough to help the worst off - likely to be women - and that these measures, while welcome, are far from generous. The government itself admits that it expects only one in five of those eligible to apply.

Some people on low and middle incomes will be entitled to extra state pension the under pension credit scheme anyway, so ATL advises that you speak to The Pensions Service or take independent financial advice before committing yourself to check to see it is worth it.

This new provision was only recently announced by the Government in October 2008 as an amendment to the Pensions Bill, so full details are not yet available. When we learn of further details, we will update this page. Look out for further news in the press.

State second pension (S2P) formerly SERPS

The S2P is an earnings and contributions related additional pension, which you will be entitled to if you have earned enough and paid sufficient national insurance (NI) contributions.

Any periods in a contracted-out pension scheme - which includes TPS - will not count for S2P as you paid a lower rate of NI while participating in those schemes. (Some people will also qualify for a small S2P pension, depending on their earnings and dates of those earnings.)

The Pensions Act changes will simplify the S2P. It will provide a flat rate amount worth £1.50 a week (in 2007/8 money) for each qualifying year built up (from 2012 at the earliest).

Changes for carers

A new credit - which will count towards basic state pension and state second pension - will be available to people bringing up children and caring for disabled people.

State Pension age

State pension age is the earliest age at which you can claim your state pension. At present the age at which men and women can claim their state pension is different. Men can get their state pension from 65 but, until 6 April 2010, women can get theirs at 60.

State pension age for women will increase to 65 so that the state pension age will be the same for both men and women by 2020. This change will be phased in from 2010.

The Pensions Act 2007 and the Pensions Act (Northern Ireland) 2008 provide for the state pension age for both men and women to rise from 65 to 68 in stages between 2024 and 2046.

For further information, please visit the Pensions Service website.

Pensions Increase Factor

Pensions in payment were increased by 0% with effect from April 2010.  This is because the RPI level for September 2009 was negative.

Need more help on pensions?

For further information or for specific advice on pensions issues, please contact the pensions team at ATL's London office. The telephone number for pensions enquiries only is 020 7782 1600. Please ensure that you have your membership number and relevant papers to hand when contacting ATL.

Planning for your retirement involves many important and sometimes complex decisions. Endsleigh has been appointed by ATL as the preferred provider of financial advice, should you wish to seek this. Please visit their website or call 0800 917 8875 for more details. Telephone lines are open Monday – Thursday 9am – 8pm and Friday 9am – 5pm. Retirement planning DVDs and seminars are available upon request.

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