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Report berates Govt on pensions

The Government&#39s pension policy has been described as “flawed” and failing to eliminate pensioner poverty in a damning report by leading thinktank the Institute for Public Policy Research.

The report, co-sponsored by CIS, calls for the state second pension and the pension credit to be abolished in fav-our of increasing the basic state pension to the level of the minimum income guarantee, currently £100 a week, and recommends that the retirement age should be raised to 67.

The thinktank also attacks Government policy since 1997, saying it has increased the need for good quality advice while at the same time making advice more difficult to provide.

The report says the Government&#39s “policy framework which relies heavily on meanstested retirement benefits is flawed”. The IPPR says this is not working for poor pensioners or for people planning for retirement and that the pension credit will not incentivise saving.

It believes that raising the basic state pension and scrapping Serps, S2P and pension credits would be more beneficial “for people in poverty and for the working poor who will no longer be penalised for their thrift”.

CIS general manager (life and compliance) Mike Fair-bairn says: “Consumers need to be clear about what to exp-ect from the Government. Only when a state solution is achieved and understood will individuals appreciate that the risk of not saving is far higher than the risk of saving.”

•Age Concern report, p10

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