What is the new State Pension?
A new single-tier, flat-rate State Pension is being introduced which will affect people reaching State Pension age from 6 April 2016 onwards. Find out what the changes mean for you.
In May 2014, Parliament agreed the Pensions Act 2014. The act:
- introduces a single-tier, flat-rate State Pension, which will replace the basic and additional pensions for people reaching State Pension age from 6 April 2016 onwards
- increases the State Pension age from 66 to 67 between April 2026 and April 2028
- makes provision for 5-yearly reviews of the State Pension age.
The information here provides an overview of the new system. You can also find out more about the State Pension changes on GOV.UK.
Why the new flat-rate pension is being introduced
The existing system is complex, has high levels of means-testing and produces inequality - for example, women tend to have lower State Pensions than men.
The Government wants to address these issues and the aim is to introduce a simpler, fairer system where people have a clearer idea about what the state will provide, making it easier to plan their retirement savings.