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Pension Reform is unclear, say MP’s

A group of cross-party MP’s have expressed their concern that the Government has not done enough to explain to the public how the forthcoming revamp of the state pension will affect them.

It is thought that around 40 million people will be affected by the changes, and although members of the Work and Pensions Committee say they support the scheme, they have said that the Government must do more to tell people how they will be affected.

The changes will mean the state pension will become single-tier, which implies that instead of the basic rate of £107 per week, plus various means tested benefits, pensioners will get a flat rate of £144 per week at current prices. While this mean that many people will benefit from the changes, those who currently pay into a second state pension are likely to lose out.

Dame Anne Begg MP, chair of the committee said: “In the short to medium term it will mean more state pension for many people, particularly the self-employed, and women and carers who have been low earners or have had gaps in employment”.

Although the changes were due to be implemented in April 2017, the Chancellor announced in the recent budget that this is now being brought forward a year to April 2016, making it all the more important to make the public aware of the changes, according to the committee of MPs.

“It is vital that the Government decides on its high-level strategy for communicating the changes to the public by the time the finalised bill comes before Parliament in the summer”, Dame Anne commented.

If you have any questions about this article, or anything else related to your pension or finances, please do not hesitate to contact one of our advisors who will be happy to help.

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