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Autumn Statement 2013 - State benefit related changes

Chancellor George Osborne delivered his Autumn Statement on 5 December 2013, and these are the future changes relating to the state pension and other state benefits.   

State pension 

The 'triple lock' remains in force, and the state pension will increase in line with this by £2.95 a week in April 2014.  (The 'triple lock' means that the state pension increases in line with the higher of the increase in the Consumer Prices Index (CPI), the increase in National Average Earnings, or 2.5%.  This has been in force since 2010.) 

State pension age

 The government has already brought forward the rise in state pension age (SPA) to 66 from 2026 to 2020, and has introduced laws bringing forward the rise to 67 from 2036 to 2028.

It is currently making laws for a new SPA framework, so that SPA will be reviewed every Parliament, with the first review happening in the next Parliament.  The principle is that people should expect to get the state pension for a third of their adult life, on average. 

The increase to 68 is likely to come forward from the current date of 2046 to the mid-2030s.   It is likely to increase further to 69 by the late 2040s. 

Changes to SPA will be considered as part of future reviews, which will take into account information about the population available at the time and independent reports on wider factors. 

Class 3A voluntary National Insurance

In October 2015 the government will introduce a new class of voluntary National Insurance contributions to allow pensioners who reach SPA before 6 April 2016 (when the new single tier state pension will come into force) to top up their Additional Pension records. 

To read more about the single tier pension, click here.   

Welfare cap 

The Autumn Statement announces how this cap will operate in more detail - however, the state pension, jobseekers' allowance and its passported benefits continue to be excluded. 

Abolishing assessed income periods in pension credit 

The government will remove the assessed income period in pension credit awards.  From April 2016, households on pension credit will now need to report all changes in circumstances that will affect their benefit as soon as they happen.  Pensioners aged 75 and over who have an indefinite assessed income period in place will be exempt unless the assessed income period would end under current rules. 

To read more about pension credit, click here.   

Winter fuel payments 

From winter 2015-16, winter fuel payments will no longer be payable to people living in an EEA country with an average winter temperature higher than that in the warmest region of the UK. 

Fraud and error in DWP benefits - life certificates 

The government will increase its activity on life certificates to ensure that state pension payments to pensioners living abroad are being made correctly, to shorten the period in which payments may continue in error after the person has died. 

If you have any questions about pensions, please contact us using one of the following methods.  

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