[an error occurred while processing this directive]
BBC News
watch One-Minute World News
Last Updated: Saturday, 13 May 2006, 13:58 GMT 14:58 UK
'Urgency' call in pension reform
By Paul Lewis
BBC Radio 4's Money Box

Mervyn Kohler, Help The Aged
Mr Kohler is concerned about the six year delay before reform
Many pensioners will not see the reforms to the state pension which the government is expected to announce on 22 May, Mervyn Kohler of Help the Aged has told BBC Radio 4's Money Box.

"We want to see the process given a lot more urgency. Delaying the start of reforming our pension system by six years is not going to help today's pensioners, a great many of whom will never see it," he said.

Mr Kohler was responding to comments by the chairman of the Pensions Commission Lord Turner on what was known of the government's plans.

Reacting to proposals to raise the basic state pension in line with earnings from 2012, Lord Turner told the programme: "We said that a short delay beyond 2010 would not seriously undermine the overall direction of the proposed reform package, but a delay of five years to 2015 would.

"So if we are really talking about 2012, that might represent a reasonable compromise between the need to limit the spread of means-testing versus concerns about public finance."

Sex discrimination

But Alison O'Connell, director of the Pensions Policy Institute, said the government's leaked plans would leave out many pensioners who needed help.

"We've heard that instead of having to have 39 years contributions through work or credits gained though caring responsibilities, women will only need 30.

"That would get more women into the system. But the big question is how to make it work for women over 60 now.

"Younger women are working more than the older generation so can we make the changes retrospective so they apply to older women now?"

She confirmed that sex discrimination rules meant that any change to the contributions conditions for state pension would have to apply to men as well.

If the government is not going to do the full Turner proposals then there will be even more people eligible for Pension Credit in future
Alison O'Connell
And she warned that the plans to reform pensions could still leave more than half of all pensioners dependent on means-tested benefits.

"Turner's proposals were to limit the future spread of the means test, keep it where it is now, around 50% of pensioners entitled to Pension Credit," she said.

"If the government is not going to do the full Turner proposals then there will be even more people eligible for pension credit in future.

"That's the key measure we will be looking out for to see what the actual outcome of the proposals will be."

Mervyn Kohler agreed that cutting the reliance on means-testing was the key. Evidence out on Thursday showed millions of pensioners did not claim the Pension Credit they could: "The figures show that one third of pensioners entitled to means-tested benefits are not claiming them," he said.

"There is something well in excess of 4bn for pensioners that is available that is not being claimed."

BBC Radio 4's Money Box was broadcast on Saturday, 13 May 2006 at 1204 BST.

It was repeated on Sunday, 14 May 2006 at 2102 BST.

Lord Turner gives his reaction to the pensions news

Pensions discussion
Money Box's Paul Lewis speaks to Mervyn Kohler of Help the Aged and Alison O'Connell of the Pensions Policy Institute

Money Box



Download or subscribe to this programme's podcast

Podcast Help

Brown and Blair in pensions deal
12 May 06 |  UK Politics
Many miss out on Pension Credit
11 May 06 |  Business
Benefits threat to savings scheme
11 Apr 06 |  Business
'Shift in state pension' needed
08 Apr 06 |  Moneybox
Q&A: Basic state pension
06 Apr 06 |  Business

The BBC is not responsible for the content of external internet sites

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Americas Africa Europe Middle East South Asia Asia Pacific