Oct 30 2006
Pensions reform minister James Purnell has announced that, after consultation on its white paper, further simplifying reforms of the pensions system were under consideration.
Changes currently being considered include a flat-rate state second pension to be introduced when pensions become linked with earnings in 2012.
However, a single-tier pension system is deemed both unaffordable and contrary to the "something for something" principle the government believes should be recognised.
"Under our reforms, everyone who has worked or cared for 30 years will be entitled to a full basic state pension," said Mr Purnell.
"We are now looking at radical simplification of the additional state pension so that people would receive a flat-rate top-up for every year spent working or caring," he added.
He suggested as an example that a top up amount could be worth £1.40 a week for each qualifying year, which would recognise the social contribution of employees.
The Association of Consulting Actuaries recently recommended that the government look into a quicker abolition of the second state pension and a reduction in means testing.
