The WASPI women from Wigan spoke to us at the Labour Party conference 2018.
In addition to our now deferred pensions, the government is continuously telling us that we’ll be better off because of the new, one size fits all, flat rate pension payment scheme. However, there appear to be other factors that prevent reaching that full amount of flat-rate pension.
Not only has the women’s state pension date moved before we get any pension, but the number of National Insurance full qualifying years has increased from 30 to 35. Where once you thought you had sufficient qualifying years, you could now actually have a shortfall.
It can be quite difficult to make up that NI shortfall as lots of women who post on here will not have continued to work after the age of 60 and will therefore not be making up the required NI contributions to receive the full new state pension.
Additionally, many will have been in contracted out works pension schemes and paid a lower rate of NI in those years. Those years now do not count towards the state pension. It would appear that some works pension schemes may actually pay out less than you would have got if you hadn’t contracted out.
Extract from Money Saving Expert pensions page regarding contracted out years… ‘To this end, the Government has decided it will deduct a sum from your new state pension – the equivalent of what you missed out on by being contracted out.
It says that, while you’ll get less than the full £164.35, retirees will still be paid what they would have got under the old state pension.
However, while many people will get a private pension boost equivalent to this deduction, it could be a lot less than the state pension they gave up – much depends on the company scheme and investment performance. To make matters worse, many workers won’t even have realised they were contracted out, so will be surpised to learn of their lower pension.
So, for many who contracted out, it seems it’s back to the old state pension rates.
How about getting a job for additional income and to make up the NI shortfall?
That’s not necessarily easy for all over 60s, particularly when your life was planned around retirement at 60. Also, not everyone can do this due to health issues and/or carer responsibilities. However, if you can, I believe the level of earnings has been increased to £162 a week before eligibility kicks in to pay class 1 NICS to count towards full qualifying years, although there is a lower earnings rate of £116 where you can earn NI credit.
However, using the minimum wage of £7.83, this equates to between 16 and 21 hours a week just to reach either of those base levels which, in these days where many employers use zero-hours contracts, it could be quite hard to maintain over a full year to gain one full years contribution.
Or, if you are eligible, you can actually pay voluntary contributions to cover any shortfalls but this is currently £14.65 per week!!!
Roll these factors in with the shift of 6 years before even receiving any state pension and it’s even more £££ lost.
The flat rate pension does not appear to be just that and not attainable by all.
Dee Ackland
