Pensions.....

[craft1948]

My brother-in-law becomes eligible for state pension in July. He took retirement through ill-health 15 years ago and has been living off his police pension ever since. They have no children and my sister paid reduced stamp throughout their marriage. She is in receipt of a small private pension and a state pension of virtually nothing as she only paid full stamp for about 5 years until she got married.
He has now been told that his state pension will be reduced, because he opted out into a private scheme. When he retired on health grounds he paid quite a hefty lump sum to ensure he got in his qualifying years for a full pension.
Now for some reason the DWP are asking for details of their savings!!
I recieve a full state pension, and this in no way affects my private pension so
1 Why should he not receive a full basic state pension?
2. Why should he be asked to detail any savings as they are not applying for means tested benefits?

Any help greatly appreciated......

[dzug2]

He probably IS eligible for a full basic state pension or not far off it. What he's not getting is the second state pension which he was contracted out of on the understanding that part of his police pension would make up for it. He would have paid reduced NI at the time as a result.

I suspect they are asking for details of savings to check if he IS eligible for any means tested benefits. Avoids the accusation 'they didn't tell us we were eligible'

[craft1948]

Never thought of it that way dzug..............I never had any problems with mine, well after they eventually got my tax coding sorted out, but they never asked about my savings.

[buildersmate]

He needs 30 years of NI contributions to get the full Basic State Pension. I am sure you will find he will get that. As Dzug says, he opted out of the State Second Pension (or its predecessor which was called SERPS - both of which act to top up the Basic) because he was in the police pension scheme for a period of time. He will get some State Second Pension for the years he was not opted-out. It is based entirely on his earnings at that time - which drove his NI contributions.

[razza]

I have just come on to state pension,mine is £123.04 per week for a married couple,the means test is to determine wether or not one is eligible for tax credits etc.I rang pensions up and asked them why it was so low,they replied because of my company pension scheme.If I had not been in a pension scheme I would have got a further £75.00 per week.It all seems that being in another pension scheme penalises you when it comes to drawing ones state pension.I have been told it was gordon brown that did this when he was chancellor.Oh and by the way it is all taxable.Got you by the b*****ks springs to mind.

[dzug2]

<<.If I had not been in a pension scheme I would have got a further £75.00 per week.>>

Well yes - but you would have paid extra national insurance to pay for that extra £75 a week. You paid your pension contributions instead.

What the net benefit/cost is I've no idea.

[buildersmate]

Gordon Brown is certainly culpable for many of our ills, but not for what accuse him of.

[dasherman]

'It all seems that being in another pension scheme penalises you when it comes to drawing ones state pension.'

It doesn't affect your state pension at all,it affects pension credit!

Ultimately,if you want a decent income in retirement you must save for it yourself and/or take advantage of company schemes/tax relief,etc. If you want to live on state handouts that may not always exist then do nothing!