Government ‘penny-pinching’ in state pension reductions – Royal London

Around 11,000 people are set to face a combined cut of approximately £33m to their state pension in April 2020, a freedom of information request from Royal London has revealed.

The response revealed that individuals could see cuts of up to £70 per week, following changes which involve the final abolition of state pension additions for ‘adult dependents’.

The 2007 Pensions Act abolished these additions for new claims as of 2010 onwards, but included a transitional period which allowed anyone already in receipt by April 2010 were able to continue receiving the benefit, which comes to an end in April 2020.

Royal London’s policy director, Steve Webb, commented: “Under the old state pension system, people claiming a retirement pension could get a significant extra amount for a spouse who was financially dependent upon them.

“Although that addition was abolished for new claims in 2010, many people already in the system have continued to benefit. It will come as a nasty shock to thousands of people to see their state pension cut by up to £70 per week.

“It seems penny-pinching of the government to take this money away when the addition is gradually working its way out of the system in any case. Losing over £3,500 per year over night will make a material difference to the standard of living of those who are affected”.

This follows the government confirmation that there is “no date yet available” for a second reading of the Pension Schemes Bill, which was reintroduced in the Queen’s Speech on 19 December 2019.

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