People must work longer for state pension
The Department for Work and Pensions has proposed that people will have to make 35 years of National Insurance contributions to qualify for the benefit, set at approximately £144 a week in today’s money.
This is five years longer than the current requirement, but is lower than the 44 years for men and 39 years for women required before 2010.
The paper also proposes a requirement for people to have been in employment for a minimum period of between seven and ten years to qualify.
Presenting the paper to parliament pensions minister Steve Webb said credits for those who cannot pay NICs because of caring responsibilities would remain.
He said the changes would benefit older women whose contribution records were broken because they had taken time off to care for children. While this group continues to accrue basic state benefits they did not accrue any state second pension when they were not working.
But Webb said the five-year increase in NICs was necessary as the state pension age rose and people’s working lives were extended.
“It’s very hard to see why you should get a full pension from a working career of up to 50 years from contributions of just 30 years,” he said.
Nevertheless, Towers Watson senior consultant David Robbins said it was a surprise that the government will not insist on a longer contribution record.
He said: “It’s pretty odd to say that all you need is 35 years of contributions when the general message is that we’re all living longer so we’ll all have to work longer.
“Once you have provided credits for carers and people engaged in socially useful activities it isn’t obvious why a full pension shouldn’t require a full career of contributions.”