Autumn Statement 2015: Biggest real rise in state pension for 15 years, says Osborne
The Chancellor today gave the Autumn Statement and Spending Review for 2015 and announced changes affecting Britain’s pensioners and workers saving for retirement.
As part of plans to cut down Britain’s welfare bill, George Osborne announced pension credit and housing benefit payments will be stopped to people who are out of the country for more than one month.
Pension credit is a means tested top-up that those above state pension age can claim if their income is below £151 a week or £230 a week for couples.
Steven Cameron, regulatory strategy director at Aegon said: “There will be few pensioners who can afford to live abroad for extended periods who would be able to claim pension credit so this seems like a reasonable tightening of who can claim means tested benefits.”
Further pension changes announced in the Autumn Statement and Spending Review 2015
*The Chancellor confirmed the basic state pension next year is to rise by £3.35 a week to £119.30.
*The State Pension triple lock has been maintained, which means the benefit rises each year by 2.5 per cent, inflation or average earnings – whichever of the three is highest.
*The single tier flat pension coming into effect in April 2016 has been confirmed at £155.65.
However, critics said pensioners still need much more clarity about the reforms coming in just four months.
Gareth Shaw, head of consumer affairs at Saga Investment Services, said: “The state pension is the bedrock for financial planning for retirement.
“The Government must do more to explain how next year’s single-tier system will work.
“The current system is horribly complicated, and the new single-tier will eventually wave away this complexity.”
He added: “But next year’s generation of state pensioners need more help understanding what they’re entitled to.
“A third of over 50s have no idea if they’ll be better off or worse under the new state pension, while less than one in 10 of over 50s know how to boost their pension before they finally claim it.
“The Government must do more to help the over 50s properly plan for retirement.”
The Chancellor also announced a clampdown on Buy-To-Let which is set to hit many of Britain’s pensioners who use the investment to top up retirement income.
From April 2016 property investors are to pay a 3 per cent stamp duty surcharge raising almost £1 billion for the Treasury.
Kate Smith, regulatory strategy manager at Aegon said: “Almost 45 per cent of us see a property as the best retirement investment, followed by a quarter who think it’s a pension.
“Today’s news that buy to let properties will incur additional stamp duty will reduce its attractiveness for retirement planning.”
Read the original story on the Express website.