Security In Retirement’ A government white paper on pensions.

These reforms involve a review of the State Pension and proposals for a new National Pension Savings Scheme (NPSS) or Personal Accounts

State Pension:

• The State Pension age is set to rise from 65 to 68 years over a phased period from 2024-2045.
• Basic State pension to rise in line with earnings rather than prices from 2012. (subject to affordability and the fiscal position)
• The State Second Pension (S2P) to become a flat rate pension from 2030.
• The number of years needed to qualify for the full basic state pension is to be reduced from 39 to 30 years starting from 2010.
• Measures are also being introduced to reduce the effects of means testing.

National Pensions Savings Scheme (NPSS):

• New system of ‘Personal Accounts’ proposed to start by 2012
• Funding:- 4% employees salary, 3% employer, 1% tax relief
• Employees to be auto-enrolled into the personal account with the ability to opt out.

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