The new single-tier State Pension


For people reaching SPA from 6 April 2016, a new single-tier State Pension replaced the Basic State Pension and the Additional State Pension. “Outdated” additions to the state pension, such as the Category D pension and the Age Addition came to an end, and the Savings Credit element of Pension Credit (see page 72) also closed to people who reach their SPA on or after the date the new system was introduced. 


Those who started claiming their State Pension before 6 April 2016 do not qualify for the new State Pension and will continue to receive payments based on the previous system (see page 69). 


The new State Pension rules apply to:


• men born on or after 6 April 1951; and


• women born on or after 6 April 1953


What you may get


The new full State Pension is £164.35 a week for 2018-19. The amount you get can be higher or lower depending on your National Insurance Contribution (NIC) record and how transitional arrangements for those with entitlement built up under the old and new State Pensions apply. 


It will only be higher if you have over a certain amount of Additional State Pension, or you defer (delay) taking your State Pension. Entitlement is calculated on what you would have got under the old rules and the amount you would have got if the new State Pension had been in place at the start of your working life. The higher figure (the “starting amount”) is paid. If it is more than the new full state pension the difference becomes a “protected payment” (increasing each year in line with inflation). But if it is less, you may have to rely on adding years to your NICs record to get closer to the full amount. Each qualifying year after 5 April 2016 adds about £4.56 a week to the pension. 


The new pension rises in line with average earnings, the Consumer Prices Index (CPI) measure of inflation or 2.5%, as does the basic State Pension under the triple-lock guarantee. 


Deferring the new State Pension


There are new rules for deferring or postponing a claim for the new State Pension. You can defer for at least nine weeks. Your state pension will increase by 1% for every nine weeks you put off claiming. This works out at just under 5.8% for every full year you put off claiming.


Qualifying for the new State Pension


You usually need to have paid NICs for at least 10 years to qualify for any new State Pension (compared to the one year you needed to qualify for the Basic State Pension). You need to build up 35 years’ of NICs before you qualify for the full new State Pension (it was 30 years to qualify for the former Basic State Pension). 


You still build up state pension-qualifying years even if you take time out from working to raise a family. This wasn’t previously the case. Pension eligibility is on an individual basis which means married women without enough qualifying years no longer receive a proportion of their husband’s entitlement when he dies.