After committing to introduce the ‘single tier’ state pension a year earlier than planned, in 2016 rather than 2017, you would be forgiven for thinking that George Osborne is in listening mode. The highly vocal brigade of 80,000 ‘double whammy’ women who complained they were missing out on the new pension (which had originally been intended for 2016), as well as being forced to retire later as female state pension age rises rapidly over the current decade, have been assuaged.
There may however be something slightly more sinister going on. Despite the government’s position that state pension reform would be fiscally neutral, the single tier pension actually increases government revenue by ending ‘contracting out’, and as such the National Insurance rebates offered to employees and employers with ‘defined benefit’ private pension schemes in return for forgoing entitlement to the state second pension.
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Image: HM Treasury