A new online petition is pushing for three major changes to the state pension system which would update the state pension age, payment rates and include expats. The official petition, created by Denver Johnson, can be found on the Parliament website.
Under this proposal, state pension payments would rise to £568.08 per week, some £30,476 each year. People would also be able to access this fund from the age of 60 instead of the current state pension age of 66.
The petition currently has 3,340 signatures at the time of writing. At 10,000 signatures, the petition would be entitled to a written response from the UK Government, the Daily Record reports. At 100,000 it would be considered by the Petitions Committee for debate in Parliament, and you can read it in full here.
The petition reads: “We want the Government to make the State Pension available from the age of 60 & increase this to equal 48hrs a week at the National Living Wage.
“We think that Government policy seems intent on the State Pension being a benefit not paid to all, while ever increasing the age of entitlement. We want reforms to the State Pension, so that it is available to all including expatriates, from age 60, and linked to the National Living Wage, for security.”
State pension and its current value
Currently, the full new state pension is worth £221.20 per week or £176.45 per week on the full basic State Pension. The proposal would equalise these two rates into a “universal state pension” for everyone over the age of 60.
Only around half of those claiming the new state pension get the full amount. This is because the amount you receive is based on how many years you paid National Insurance or received National Insurance credits.
You need 35 qualifying years in order to receive the full new state pension. Both state pension rates are increased every April in line with the triple lock mechanism which assures it will rise by the highest of three figures; inflation, wage rises or 2.5%.
Experts predict a 5.2% increase next April, based on the current wage growth in the UK. This would leave people with £242.90 per week next year on the new state pension and £186.25 per week on the basic state pension.
Many Brits miss out on state pension increases
However, nearly half a million Brits don’t get this increase because they have retired in a country that doesn’t have a reciprocal agreement with the UK government. These expats see their state pension frozen at the level it was when they left the UK, meaning they lose out on additional income when the state pension rises.
The uplift proposed in the campaign would also be applied to some 453,000 retirees whose State Pension has been frozen at the point of emigration because the country they now live in does not have a reciprocal agreement with the UK Government. As it stands, some are being left on as little as £20 per week, according to the End Frozen Pensions campaign.
The proposal would ensure these retirees would be uprated each year like their counterparts living in the UK. But it could also see retirees being liable for income tax.
Labour confirmed earlier this year that the Personal Allowance, the amount most people can earn each year before paying income tax, will be frozen at £12,570 until April 2028 according to the Daily Record. The current new and basic state pension rates are only a few hundreds pounds away from this allowance threshold at the moment. Matching state pension payments to National Living Wage would exceed this limit and most likely make retirees liable for a small income tax bill.
