Coalition plans for pensions and older people

The new Conservative-Liberal Democrat coalition government issued a document in June “The Coalition: our programme for government”. There is an online version of the same. Setting out its programme for government for the next five years, it says it hopes to take the country through the current difficult period to better times ahead.

Does it have anything particular to say to older people? Well, yes it does, and here is a summary of what it says.

The Coalition believes that older people deserve dignity and respect, and that they should receive the support they need, which means making sure that key benefits and pensions are kept safe. In addition it should be easier for older people to work or volunteer.

The Government says it will restore the earnings link to the basic state pension from April next year, with pensions being raise by the higher of prices, earnings or 2.5%. It also says it will form an independent commission to review long-term affordability of pensions in the public sector, with accrued rights being protected.

The Coalition is to phase out the default retirement age and review the date at which state pension age will go up to 66. It will not be sooner than 2016 for men and 2020 for men, it says. Rules for compulsory annuitisation at 75 will be scrapped.

The Government is also to look at giving people more chance to access part of their original pension fund sooner than now allowed.

Older people’s key benefits, such as winter fuel allowance, free TV licence, free bus travel, free eye tests, free prescriptions will be protected.

The Parliamentary and Health Ombudsman’s recommendation for Equitable Life’s policy holders to be paid fairly will be implemented after a regulatory failure caused losses.

The Government also says it will simplify rules on pensions to help boost occupational pensions, so that companies are encouraged to off pensions to all employees.

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