State Pension Provision
If you have built-up enough qualifying years, (by paying National Insurance contributions) you will be paid what is known as the 'basic state pension' from the age of 65. (If you are a woman born before 6 April 1955 you may qualify to be paid a basic state pension before the age of 65.)
In the coalition government's 'emergency budget' in June 2010, it was stated that the government intends to raise the state pension age to 66 and will consult on when to introduce this change. It is likely, given increasing longevity, that the state pension age will continue to rise in future years.
Current (2010/2011) state retirement benefits take the following forms:
Basic State Pension:
The basic state pension is £97.65 a week per person (a married couple would be paid this amount each; a total of £195.30 if they both had the requisite number of qualifying years) or £156.15 a week for a married couple, if one of them uses the contribution record of his or her spouse.)
The amount of the basic state pension that will be paid to you is not related to your pre-retirement earnings, but is dependant upon your having a full National Insurance contribution record. If you do not have a full contribution record, you will receive a reduced basic state pension.
The basis state pension is payable to both the employed and the self-employed when they retire.
State Second Pension:
The State Second Pension is an earnings-related pension that replaced the former State Earnings Related Pension Scheme in April 2002.
It is an additional state pension, payable on top up the basic state pension. Unlike the basic state pension, the amount you will receive is based on your earnings.
The state second pension is payable only to the employed. It is not payable to the self-employed.
Pension Credit:
In addition to the above two state pension benefits, neither of which are means-tested, there is also the pension credit , which is a means-tested benefit, for more information see:DirectGov
