State pension revamp sets strong foundation for the future

The National Association of Pension Funds (NAPF) welcomed the announcement of a new state pension expected to be made at 15h30 in the House of Commons today (Mon).

Joanne Segars, NAPF Chief Executive, said:

“Today’s announcement for a simpler, more generous state pension is a much-needed shake-up that will ultimately help millions of pensioners and savers. For the first time in a generation, people will know that it pays to save, and that whatever they put aside won’t be eroded by means-testing when they retire.

“We welcome the Government’s strong commitment to radical change. This blueprint is a key step towards a system that will help people retire with confidence and dignity. The trade-off for working longer must be this better state pension, which will also treat women, the low-paid, and the self-employed more fairly.

“People like their pensions simple. This will set a clearer, fairer state pension that offers an easily-understood foundation on which they can plan their retirement. A flat rate system also dovetails with the recent auto-enrolment reforms by helping workers see what they need to save in their new workplace pension.

“The current state pension is unfair, complicated, and in desperate need of an overhaul. Its maze of payments and credits mean that even financial experts are often left wondering what they will get. With one in three babies born this year set to live to 100, the pension system has to evolve.

“The NAPF has been campaigning for a flat rate state ‘foundation’ pension for years. This is the light at the end of the tunnel. However, these are complicated reforms that will mean big changes in the way many company pensions are run. We are glad that the Government recognises that challenge and is supportive of the need to manage the transition carefully.”

 

Notes to editors:

1. The NAPF is the leading voice of workplace pensions in the UK. We speak for 1,300 pension schemes with some 16 million members and assets of around £900 billion. NAPF members also include over 400 businesses providing essential services to the pensions sector.

Contacts:

Paul Platt, Head of Media and PR, NAPF, 020 7601 1717 or 07917 506 683, [email protected]

Christian Zarro, Press Officer, NAPF, 020 7601 1718 or 07825 171 446, [email protected]