The majority of current employees reaching state pension age in the next 40 years will receive a higher state pension due to the state pension reforms, according to new single tier figures published by the Department for Work and Pensions (DWP) today.

Over half of over-25s will receive a higher state pension than they would under the current system. In the 2020s, three-quarters of all new retirees will receive a higher state pension and in the 2040s this will be around two-thirds, the figures, released as part of the Impact Assessment on the Single Tier, showed.

Planned for April 2017, the new flat-rate pension will particularly benefit women taking time out to raise a family, low earners, and the self-employed whose National Insurance contributions will for the first time count towards a full Single Tier pension of £144.

Without the reforms, government spending on state pensions and benefits would rise from 6.9 per cent of GDP in 2012/13 to 8.5 per cent in 2060/61. But with the introduction of the flat-rate state pension, this will instead reach 8.1 per cent in 2060, ensuring it remains sustainable for future generations.

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