State Pensions Reform

Steve Webb Excerpts

Thursday 12th July 2012 Written Statements

[The Minister of State, Department for Work and Pensions (Steve Webb)]

I should like to inform the House about the progress this coalition Government are making with their plans for state pensions reform.

At Budget 2012, the Chancellor confirmed that we will reform the state pension system to introduce a simpler, single tier state pension for future pensioners to better support saving for retirement. A simple flat-rate state pension above the basic level of the means test will bring much needed clarity and simplicity to the pension system, and provide the foundation needed to support automatic enrolment into workplace pensions, enabling people to save for their retirement with confidence. The reforms will be introduced in the next Parliament and will not cost any more than the current system overall.

The Budget also confirmed that the Government will introduce a mechanism so that future increases in state pension age take changes in longevity into account.

Together, these reforms will deliver a state pension system that is fit for the 21st century.

Given the scale, complexity and importance of these two significant reforms we are still working on the details, to ensure we get them right. Therefore, we will set out further detail on both the single tier reform and state pension age review mechanism in a White Paper in the autumn.