A single-tier pension: what does it really mean? - The Institute For ...
A single-tier pension: what does it really mean? - The Institute For ...
A single-tier pension: what does it really mean? - The Institute For ...
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Contents<br />
Executive Summary 1<br />
1. Introduction 4<br />
2. Current State Pension System 5<br />
2.1 Current accrual under the existing state <strong>pension</strong> system 5<br />
2.2 Historic <strong>pension</strong> legislation and <strong>it</strong>s continuing implications 9<br />
2.3 Pension income received under the current system 14<br />
3. Proposed Reforms 15<br />
3.1 <strong>The</strong> proposed <strong>single</strong>-<strong>tier</strong> <strong>pension</strong> 15<br />
3.2 Ending derived and inher<strong>it</strong>ed <strong>pension</strong>s 18<br />
3.3 Ending contracting out 18<br />
3.4 Trans<strong>it</strong>ion issues 19<br />
3.5 Changes to <strong>mean</strong>s-tested benef<strong>it</strong>s 22<br />
4. Short-Run Effect of the Proposed Reforms on Pensioner Incomes 25<br />
4.1 Data 25<br />
4.2 Comparing state <strong>pension</strong> income at SPA under the proposed and 27<br />
4.2 current systems<br />
4.3 Gains and losses over the whole of retirement 41<br />
4.4 Interaction w<strong>it</strong>h <strong>mean</strong>s-tested benef<strong>it</strong>s 43<br />
4.5 Summary 47<br />
5. Long-Run Effect of the Proposed Reforms on Pensioner Incomes 48<br />
5.1 How would the level of state <strong>pension</strong> income received at state 48<br />
5.1 <strong>pension</strong> age compare?<br />
5.2 How would state <strong>pension</strong> income evolve through retirement under 51<br />
5.2 the two systems?<br />
5.3 <strong>The</strong> self-employed 54<br />
5.4 How <strong>does</strong> the proposed system affect who would qualify for <strong>mean</strong>s- 55<br />
5.4 tested benef<strong>it</strong>s and <strong>what</strong> they would receive?<br />
5.5 Summary 61<br />
6. Wider implications of the proposed reforms 62<br />
6.1 A long and circular road 62<br />
6.2 Reducing the long-run costs of state <strong>pension</strong>s 65<br />
6.3 Future pol<strong>it</strong>ical risk 66<br />
6.4 Greater need for private saving 66<br />
7. Conclusions 68<br />
References 70