Pensions 'set for boost'

12 April 2012

Around half a million people who have not paid enough National Insurance will be entitled to a full state pension if they top it up with one-off payments, it was reported.

Up to 555,000 people could benefit from the policy change which will allow them to make up for missed NI contributions, according to the Daily Mail.

It will potentially boost the retirement income of a generation of older women who stayed at home to raise children or care for sick or disabled family members.

Only around a third of women reaching pension age qualify for a full basic state pension.

Under the current system people can buy back the previous six years of missed NI contributions.

Pensions Secretary James Purnell is set to announce an amendment to the new Pensions Bill which will allow women to buy back up to six more years.

The move marks a change of heart for the Government which last year overturned an amendment to Pensions Bill designed to give people the opportunity to buy back extra years of missed contributions.

Mr Purnell said around 75% of women reaching state pension age will be entitled to a full basic state pension by 2010, rising to 90% by 2025.

Age Concern, which has a long-running campaign to change pension rules, welcomed the U-turn.

A spokesman for the charity told the Daily Mail: "We are absolutely thrilled. The Government should be congratulated for finally delivering a fairer deal for women and carers."

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