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Tories slam state pension revelation

The Conservatives have slammed the Government after it was revealed that the 2.5 per cent rise Chancellor Alistair Darling pledged to make to the basic state pension will not apply to all pensioners.

The move is expected to save the Treasury £350m in 2010/11 compared to if the rise had applied to all parts of the state pension.

In his pre-Budget report last week, Darling said the “basic state pension will not be frozen, but will rise by 2.5 per cent in April”.

The report did not mention that the parts of the state pension which do not count as basic would be frozen.

Pensions minister Angela Eagle told the BBC over the weekend that extras such as the state earnings related pension will be frozen adding that this will prevent unfairness between Serps and company pension schemes.

But shadow chief secretary to the Treasury Philip Hammond says: “As always with this Government the headlines of their announcement unravel when we see the small print.

“The pensions minister has revealed Alistair Darling’s 2.5 per cent rise will not actually apply to all pensioners.

“This year’s PBR has been the most political and cynical of Labour’s term in office, now we see the cruel deceit of pensioner and benefit recipients who were given false hope on Wednesday, only to have their expectations dashed by Saturday.”

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Comments

There are 12 comments at the moment, we would love to hear your opinion too.

  1. It is what we have all come to expect from this discredited government

  2. Sorry? I am not a great fan of any party but the way i see it is the government raise the basic rate state pension by 2.5% when they were under no obligation to do so and the tories decide to have a pop about a few pounds of SERPs pension not rising!

  3. Andrew Believe-It-Will-Better-Under-The-Tories? 14th December 2009 at 11:18 am

    £350m seems like a reasonable saving – perhaps the public purse can do without it when the prospective & current parliamentary non-doms start paying tax?

  4. What a load of nonsense. He only said the rise would apply to BASIC State Pension. Which pensioners get other pension if they do not get Basic State Pension.

    There could have been Nil rise on all pensions in accordance with current rules, or less than the 2.5%.

    Who knows what the Tories would have done with the same decisions to make?

  5. It was announced in the Spring budget that the increase would only apply to the basic state pension. Why the Tories are making a meal of this now is stupid and shows their ignorance regading the interaction of SERPs with occupational pension schemes.
    It would be an admin nightmare and an additial libility on group pension schemes if the 2.5% apllied to SEPs etc.

  6. I agree with Tony Slimmings. In order for the statement that “some pensioners will not see their state pension rise” to be true someone would have to be in receipt of SERPS or Graduated Pension, but no basic state pension, which is an unlikely scenario. I am no fan of Labour, but let’s stick to facts please.

  7. The Tories should check their facts before sounding off.

  8. Oh so many interesting comments, as a Pensioners, who decided not to contract out of SERPS in the 1970’s but to leave my lot with the Government, I feel that I am now being penalised for this. Rather than take risks with Insurance schemes, I though I would “play safe”, !!!!!, It is also woth noting that although I receive a small Company pension from the private sector, which this year increses by 0%, it seems that most of those Pensioners in the Public Sector still get increases, a fair system, I think not

  9. I have to agree with the last contributor. This is not about the detailed realities of the interaction of BSP, S2P, SERPS etc.; it is the fact that pensioners DON’T differentiate between one and the other, or understand the difference!
    They believed they were getting an increase of 2.5% without strings. The reality is different.
    I for one, do not believe that this was an accidental false impression from this government!

  10. In fact, my own Public Sector final-salary linked pension will rise by 0% this year. I do understand why SERPS isn’t to rise, since all those in a contracted-out scheme would also then be entitled to a rise from their pension scheme. But the same logic doesn’t apply to other parts of the additional pension (e.g. to the amount added on as a consequence of working past pension age).

  11. Am I not right in thinking that the 2.5% increase
    will be taxed !

  12. This decision to freeze top-ups on the basic state pension has all the hallmarks of Gordon Brown’s government:-

    Stealth, mean-mindedness, obfuscation and a contempt for British pensioners.

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