Tories and Labour mooting possible means testing of State Pension

[Turmerictolly]

www.theguardian.com/politics/2025/jan/17/kemi-badenoch-pensions-triple-lock-means-test-alarm-tories

I would be so gutted if this happened but there's noise from both parties about this recently. I think it might be inevitable. What will happen to those of us nearing 60 who have made plans that include the full state pension we've paid contributions for?

www.telegraph.co.uk/politics/2025/01/17/no-10-refuses-to-rule-out-means-testing-pension-triple-lock/

I'm more worried about the younger generations who are expected to support us all.

People always moan about how they've "paid in" but the reality is you've been supporting the current pensioners. There is no pension pot, the money isn't invested or ring fenced for you. Most of us aren't net contributors and should stop being so entitled.

No guarantee of any inheritance, a friend of theirs looked at a care home recently which was £8k a month. That would wipe anyone’s wealth out over a few years.

What you’ve said is also totally irrelevant. If you want to start a thread about inheritance tax feel free, but this is a conversation about state pension.

This is the tax year when my state pension becomes fully funded. I want the full state pension because I spent decades buying it. It's mine.

This might be behind a paywall. Labour have set a precedent too by basically means testing the winter fuel payment. However, I'd hope they'd take a more measured and considered approach to bringing in any changes.

I would be pissed off if this came in before removal of government backed DB pensions. They need to go first.
I am 4 years off reaching my necessary NI contributions for full pension, there was little to no information about pensions when I started work and so it took me probably best part of a decade to start a pension, because it wasn't enforced. I have had my pension age increased by 8 bloody years since starting work, so why should I be penalised even further for defined bloody government pensions and people who have spent all their cash if they ever had any.

If “work sucks” why don’t we reduce the retirement age to 30? Then I could retire. Sounds great! But completely unaffordable.

I want older people who don’t need state pension not to get it so that people who do need it get more money. Seems fair to me. And I’m not suggesting a 6 figure retirement income is typical but I also don’t think they will be the only pensioners in this position.

I think most people on this thread, including me, understand how contributions work. People of my age have paid in full for the generation above us but now there are indications that our pension may not be paid in full in the near future. I understand some kind of means testing needs to happen but it needs to be fully phased in over a very long time and there needs to be cross party agreement on this.

The difference between the state pension that people "earn" by working and paying NI is currently only £3 pw more than means-tested pension credit that's paid to pension age people who don't have any pension and may never have worked.

Pension credit qualifies pensioners for the winter fuel allowance, too, so a pensioner who's never worked actually gets more from the state than someone who's worked for 50 years.

That doesn't seem fair to me.

Why are so many in this thread unable to understand they have been lied to??

You are not entitled to anything. You haven't funded anything. You have not "paid in to" anything.

The pension is an unfunded benefit, paid for out of general taxation. It can, and ultimately will be, taken away from some or all of us.

I doubt anyone under 40 will ever see a state pension, at least not in its current form. Those between 40 and retirement will probably face stricter and stricter means testing until the pension is denied to the majority.

Its no wonder people fall for pyramid schemes when they believe so easily what the government tells them.

I need to pay 5 more years to get mine what would I do, stop paying and put into a sipp

I agree with this. For example, the Tories making child benefit means assessed rather than universal has led to it being somewhat stigmatised, and this could be the same for state pensions. However, I think it's more important to emphasise that only the very rich would be affected by such policies and not those on middle incomes.

You'd be surprised at how many people don't understand.

How long should it take to be phased in? Because the longer you make it the more it benefits us and the more it screws over our kids.

Can you tell us what Labour have said and who said it as you've included them in your thread title?

The State Pension was not intended as a reward for working. It's there to ensure UK pensioners do not live out their days in hardship and poverty.

If the UK is to grow, we need to invest in future generations rather than top up the wealth of those who don't need it.

Don’t the higher and additional tax rates achieve much of that anyway? Even the basic rate taxpayer is ‘giving back’ over £2k a year of the new state pension if their other pensions / income is more than £12,570 (or £16k ish if all pension and they didn’t take the tax free 25%). Once you have other pensions income more than £37kish then you’re ‘giving back’ £4,500 or so of your state pension, and £5k ish if you’re a 45% taxpayer in retirement. Is further means testing necessary?

But pension isn’t a benefit or welfare payment. People have paid into it for years so are just getting out whatever they’ve paid in. I see a lot of people lately referring to pensions as benefits, when that’s not the case at all.

But they’re funded the same way - paid by today’s taxpayers. There are fewer working people than there are pensioners now which is the opposite of the situation when the state pension started. We can’t have such a massive demographic shift and expect the system to operate in the same way.

Where does it say Labour is thinking of means testing the State pension?

As for the Tories, that's Kemi shooting her mouth off and she is no doubt being told the hard political facts that pensioners vote and you can bet Reform will swear blind they would NEVER do such a thing.

"This is the problem, that people are led to think that they have paid in to anything - that isn’t the case at all."

There is a legitimate point that the government has entered a social contract. Workers pay the pensions of retired people and expect the same to happen when they retire.

The obvious issue that in the years the state pension started the demographic balance has skewed with far more people retired and proportionally less people working who's contributions pay for those pensions.

This is also true of government pensions like the teachers pension scheme.

This can be made cheaper by
eroding the real value of the state pension ( which the triple lock currently largely minimises this effect) or
Increasing state pension age

as PP posters have said means testing the state pension. This disincentives people to save for their own retirement ( unless very wealthy) as they lose 11k a year state pension. Millions of people might only have a 10 to 15k pa private pension to top up their state one ( or less)

It's difficult to change to a funded model now as it is unfair to ask workers to save for their own state pension whilst at the same time taxing them to pay for current state pensioners.

Means testing the benefit itself is likely political suicide as older people are far more likely to vote than younger ones...

The way to do this would be to set up a system whereby it switch over in a way that would account for where people are in their working life.

New workers would start with the new system, ones near retirement would keep what they have now, and then those in the middle would use both according to some calculation.

My husband who was military in a country other than the UK had to deal with something similar when they totally changed the pension system. It was a PITA to work out when it came time to retire, but the concept was fair, I think.

it really didn’t, I said I’m not expecting an inheritance and told you why. Another totally irrelevant post.

I thought you needed 35 full years of NI contributions now to get full new state pension?