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Back to index of Nerve 20 - Summer 2012
Benefits Column
I am due to retire in October next year, when I will be 60. But one of my friends, who wanted to retire at 60, found that she can't draw her retirement pension until she is 62. Why is this? Also, I took some years off work to look after my daughter when she became disabled so I might not have a complete national insurance contribution record. How do I find out how much pension I will get, and when I will be able to get it?
There are two reasons why some women will have to wait until they are older than 60 to be able to retire and draw their state pension. The government has had to equalise the ages at which men and women can retire, after a European Court ruling that having men retire later than women amounted to sex discrimination. It has also decided to increase the age at which everybody can retire. This change was planned a few years ago by the Labour government. The reason they gave for it was that the British workforce is ageing, and in future people will need to work and pay taxes and N.I. contributions for longer for the country to be able to afford to continue paying pensions and benefits. Few people seem to have been aware of the changes at first, or the impact it would have on them, so the Labour government faced few or no repercussions. But the Coalition government is now facing a reaction against the changes in the form of protests and industrial action from a number of trade unions.
The increase in retirement age will happen in stages, but eventually the government intends to increase the retirement age to 68. The age at which you can retire will depend on your date of birth. The change will have less impact on men as they already had a retirement age of 65.
There is useful information about how to find out at what age you can draw your state pension, and how to get a pension forecast so you know how much you are likely to get, on the pensions section of the www.direct.gov website. Since you were born in 1952, you will not be able to get your pension until 2015, when you are 62. People who were born after 1953 will have to wait longer, some will not be able to draw their pensions until they are 66.
However, as well as increasing the pension age, the government also reduced the number of years for which you have to have worked and paid, or been credited with, national insurance contributions over your working life from 39 years (44 for men) to 30 years, to qualify for the maximum state retirement pension. This makes it easier to qualify.
If you stopped work to look after a disabled person, you might have been credited with national insurance contributions under the Home Responsibilities Protection scheme. If you were claiming carers allowance while you were looking after your daughter, you will almost certainly have been credited with contributions, which will count towards your pension.
Retirement pension is made up of a few different elements, but the basic pension is currently £107.45 for a single pensioner. To find out how much you might get, you can ask for a pension forecast by phone on 0845 3000 168. You will need to know your national insurance number so that the adviser can look up your contribution record. Alternatively, you can ask them to send you a form so you can apply for a forecast by post. You should post the form to: The Future Pension Service, Tyneview Park, Whitley Road, Newcastle upon Tyne NE98 1BA.
The basic retirement pension is less than the current maximum amount you can get in Pension Guarantee Credit. This is currently £142.70 per week for a single person. Pension Guarantee credit is basically a type of income support for pensioners and you can claim it if your income in retirement, from all sources, is less than the current rate. You can claim it over the phone on the Pension Service's freephone number, 0800 991234. If you prefer to claim by post, they can send you a form.
There are other issues related to this question about pensions, such as whether employers can still force people to retire at a certain age, and what rights people might have to continue working past 60, or 65, until they can access a state pension. Connected to this is the issue of age discrimination in employment.
Answers to these questions are beyond the scope of this column, but I can be contacted on www.carol-laidlaw.blogspot.com or on 0161 624 1076 by anybody who wants to know more about pensions or employment rights.
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