State Pension Reform

Marcus Jones Excerpts

Monday 14th January 2013 Commons Chamber

[Steve Webb]

I am grateful to the hon. Gentleman, because I understand the concern that any change creates for people. In 2017, I assure him, we will work out people’s pension rights under our new system— 35 years for the full £144, with deductions knocked off for past periods of contracting out—and if that figure amounts to less than the rights someone has already built up, they will start from the higher one. We will honour the past. People will not build up new rights under those sorts of arrangements, but those they already have will be honoured.

[Mr Marcus Jones (Nuneaton) (Con)]

I have been contacted by many of my constituents over the last few months who have been concerned about the investment that they have already made in SERPS and in the state second pension. Will the Minister confirm that contributions already made will be honoured and that pensions will not be rounded down as a result of this policy?

[Steve Webb]

Yes, I can give my hon. Friend the assurance that he seeks. If a pension document says, “You have already built up a pension of £160, £170 or whatever”, people will get at least that amount. Going forward, people will not be able to build up those sorts of pensions in the future, but when they have built them up already, we will recognise those contributions.