Brent Pensioners Set To Get Over £25 A Week Extra Under Lib Dem Plans

3.11.12pm BST (GMT +0100) Tue 7th Sep 2004

Sarah is welcoming Lib Dem proposals to give pensioners in Brent £25 a week extra

Single pensioners over 75 in Brent will have an extra £25 a week on their pension and couples over 75 would have an extra £33.70 a week, under new Liberal Democrat plans launched today. The plans will lift a million people out of means testing overnight.

Based on residency rather than National Insurance contributions, the Citizen's Pension will particularly benefit women, who will no longer be penalised for caring for their children at home or be reliant on their husband's pension.

In the first term of a Liberal Democrat Government, the Citizen's Pension will be targeted at the over 75s who tend to be the poorest, the majority of whom are women. The policy will later be extended to all pensioners.

The Citizen's Pension will rise in line with average earnings so that all pensioners could share in the growing wealth of the nation. It would be set at £105.45 for single pensioners and £160.95 for couples. The cost of the policy will be £2.7 Billion and will be met through the abolition of

the DTI. The extra money that is required in the first Parliament will come from slimming down central government, specifically departments such as the Treasury and DCMS.

The policy would also take radical steps in the area of occupational and private pensions. Plans would include:

SIMPLFYING SAVING - making occupational schemes "opt out" schemes rather than "opt in" schemes so that employees have to make a conscious decision not to save in the scheme;

FAIRER PENSIONS - righting an historic injustice. The current system is stacked against women who stay at home to care for their children and/or work part time and who have patchy NI contributions. Based on residency, the Citizen's Pension particularly benefits women;

REDUCING THE SAVINGS GAP - slashing means-testing and ensuring that every penny saved is a penny better off;

OFFERING CHOICE - removing the requirement to buy an annuity at 75, so that people can decide for themselves how to use their savings;

TRUST IN PENSIONS - offering new, low-cost pensions run by National Savings;

SIMPLE GUIDANCE - establishing a kitemark system for occupational pensions so that all employees and job applicants can see the rating that a company's scheme has been given.

The pension policy is the first of a number of plans from the Liberal Democrats to enable an active and dignified retirement.

Launching the policy, Charles Kennedy MP, Leader of the Liberal Democrats, said:

"This is about fairness for all pensioners. Overnight we will lift one million pensioners out of means testing and we will ensure an extra £25 a week on the basic state pension for single pensioners. Many pensioners are missing out on a decent pension because of the complexity of the Government's Pension Credit. Our Citizen's Pension will give people a decent pension as a right without needless form filling and bureaucracy.

"There is a lack of confidence in the pensions system. Today's measures will restore faith in pensions as a way of saving for retirement."

Local Liberal Democrat MP Sarah Teather said:

"I welcome the announcement made by Charles Kennedy. The Government has made a mess of pensions. These measures would provide dignity for pensioners in Brent whilst creating a simple and flexible framework for those who save in occupational and private schemes.

"Offering a generous state pension which does not lose its value means that in one fell swoop pensioners in Brent will be receiving a better deal. Women, who have for so long been the poor relation in terms of their pension rights, will also benefit. They will no longer get penalised for caring for their children at home or have to be reliant on their husband's pension.

"The present system is too complex and rigid. The pensions system should be simple and secure so that people can make informed choices and know that their money is safe."

ENDS (Notes to follow…)

Notes to editors

1. The Liberal Democrats today launch their Pension Policy - DIGNITY AND SECURITY IN RETIREMENT. The key proposals are written below:

Liberal Democrats propose that the state pension is reformed by:

1) Ensuring that everyone has a decent income in retirement by creating a Citizen's Pension, with entitlement based on residency not National Insurance Contributions - a policy that will be of particular benefit to women.

2) Setting this pension at the level of the Guarantee Credit uprating it in line with average earnings, so that pensioners share in the growing wealth of the nation; guaranteeing this Citizen's Pension for all pensioners aged over 75 in the first full financial year of the parliament, as the first step to providing it for all pensioners.

Liberal Democrats propose that occupational pensions are reformed by:

1) Establishing a kitemark system for occupational pensions so that all employees and job applicants can see the rating that a company's scheme has been given; making occupational schemes "opt out" schemes rather than "opt in" schemes so that employees have to make a conscious decision not to save in the scheme;

2)Allowing companies to make membership of their company scheme a condition

of employment.

Liberal Democrats propose that private saving is reformed by:

1) Increasing incentives for private saving by reducing means-testing and ensuring that every penny saved is a penny better off; restoring confidence in private pensions by offering new, low-cost pensions run by National Savings;

2) Removing the requirement to buy an annuity at 75, so that pensioners can decide for themselves how to use their savings; giving everyone an annual pension forecast to help them plan their savings; introducing new low-cost ways of accessing advice, including through local

Citizen's Advice Bureau.

Liberal Democrats propose that retirement is reformed by:

1) Encouraging a "flexible decade of retirement", where workers can combine part-pension and part-work so that retirement becomes a process rather than a sudden "cliff edge" event;

bringing forward age discrimination legislation immediately and ensuring

that it is vigorously enforced;

2)Ensuring that employers scrap arbitrary retirement ages; making it financially possible for older people to return to education and training, by making student loans available to those over 55

Related Link:

Read Sarah's view on retirement with dignity.