In a bid to incorporate measures to help people this year and make the tax and benefit system fair and sustainable, Chancellor, George Osborne has accepted Lord Hutton’s recommended reforms to public service pensions.
Lord Hutton said in a report released earlier this month that public sector pensions should no longer be related to final salaries, but by 2015 they will be connected to average career earnings.
National Association of Pension Funds’ chief executive Joanne Segar’s said:
“This is a turning point for pensions in the UK. Over half a million new pensioners a year will get a simpler and more generous state pension and reliance on means-tested benefits will be slashed. “For too long, we have put up with one of the most complicated and meanest state pensions in Europe. “This reform provides a clearer foundation for saving for old age. For the first time in a generation, people will know that it pays to save.”