Pensions

We believe in decent pensions for ALL – every pensioner should receive at least £400 a week.

The current state pension system is a mess. The basic pension is insufficient for people to live on and, for many, has to be topped up by benefits. The pension is one of the worst in the developed world amounting to 28% of average earnings against the norm of 63%. 

On top, a minority mostly public sector workers receive generous unfunded pensions, averaging £200 a week that rise with inflation. The majority who have had to fund their own pension receive around £60 a week, an amount whose value is eroded by inflation.

Reforming the current pensions system is controversial. At its heart, however, is addressing the fact that successive governments have deceived people into thinking that they were paying into a pension fund through national insurance contributions. Unfortunately, no such fund was set up, instead governments have spent the money paying current pensioners, and on other public expenditure.

As people live longer the overall cost of state pensions rises, with proportionately less workers to fund pensions. Either taxes have to go up or pensions reduced further.

Our solution is to encourage people to work longer, in return for a higher pension when they retire. We will also introduce honesty in the way pensions are funded, with the cost of pensions being reclaimed from estates on death. The scheme will permit pensioners to choose even higher pensions.

The Peoples Party will:

  • establish a basic state pension of £400 per week for both men and women irrespective of previous national insurance contributions payable at 74 and over

  • allow people to choose if they wish to retire earlier, fixing their pension payment at the level on the retirement scale at the age of retirement
  • raising the bottom age and the top of the scale by one year every five years.
  • exempt pensioners at 74 and over from education, health and council taxes. The abolition of taxes on savings will also end the double taxation of pensioners incomes
  • establish a new system of state underwritten pension funds to encourage personal pensions
  • change the way state pensions are administered by establishing independent pension funds that will issue debt to finance pension payments and reclaim the total value of pensions paid from an individual’s estate. The Government would make up the shortfall between amounts paid and those reclaimed
  • provide free social care or vouchers