‘Middle income pensioners squeezed' - Woman, 72, gets £42 less than others due to birthday

The State Pension was split into a two tier scheme in April 2016. The basic or “old” state pension can be claimed by men born before April 6, 1951 and women born before April 6, 1953 – the full sum currently stands at £137.60 per week. Whereas the newer scheme can provide Britons with more money in some cases. It is available to men born on or after April 6, 1951 and women born on or after April 6, 1953, with the full new sum set at £179.60 per week. But for some who are on the older state pension scheme, they feel more needs to be done to make Britons aware of the lower amount which certain pensioners are receiving.

This is a sentiment expressed by Christine Ritchie, a 72-year-old working state pensioner, currently in receipt of the basic state pension, who spoke exclusively to Express.co.uk.

She said: “I get £42 less per week than people which came on in 2016. Many people will appreciate that this type of figure would cover the TV Licence – which is a very important entitlement.

“There are all sorts of problems with the older state pension. Many people worked and paid in to a private pension, they may have not put in much, but it could be just enough to tick them over into a group where they cannot receive any other Government support.

“At the end of the day, it is what is is. I have to live with it and I have to deal with it, if you argue you may as well be beating your head against a brick wall.

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© Getty state pension payments

“However, what frustrates me and lots of my colleagues is the fact that the top rate is always the one which is quoted, and that influences people’s perceptions of the state pension. Some will turn around and say we’re receiving a lot, but this simply isn’t the case for a lot of people – not everyone is getting the top rate.”

Older rules for the state pension are far more “complicated”, Neil Rushton, chartered financial planner at Old Mill, explained to Express.co.uk, with a basic state pension being built up over 30 years.

He added: “There is the possibility of an additional state pension built up by employees based on their salary. This additional component used to be called the State Earnings Related Pension Scheme (SERPS).

“This complication made it difficult to know how much you’d get until you were close to state pension age. But the old system is still taken into account – it was possible to opt out of the additional state pension entitlement and instead receive a contribution to your company or personal pension scheme.

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“This ended when the new state pension was introduced but there will potentially be a reduction in your state pension because of this (with the difference hopefully made up by income from a private pension).”

However, for Ms Ritchie, working for charities and non-profit organisations all her life means her private pension is not enough to provide her with the kind of support she would ideally like. Coupled with personal circumstances such as an expensive mortgage, she was limited to what she could save.

It is situations such as these, she said, which are part of the reason many on the older state pension take issue with how the sum is described.

She continued: “When pensions were first introduced, they were seen as a right and not a benefit. A friend of mine said she hates it being referred to as a benefit.

“We were told we were paying for the people that came before us. But all we are asking for is the same we gave our predecessors. The respect that, yes they worked hard, and here is a pension which reflects that.”

© EXPRESS state pension UK

While Ms Ritchie acknowledges some pensioners are “quite secure” in their income, there are others, she states, who face financial challenges.

She continued: “You get the middle income pensioners, like me, those people who have been out to work all their lives – these people seem to be the ones which are most squeezed. Top income pensioners can afford the life they need, but middle income pensioners are often just over the limit should they want to claim any benefits.

“Then you get the others, those who get other benefits. These individuals may not have worked. They get the support they need in the sense they can get help from the Government.

“This is where the middle income group suffers. The middle group is squeezed, for simple things such as the removal of the TV Licence for over 75s. It’s only £159, but for some people that can be a whole week’s worth of pension.”

Ms Ritchie continues to work part time, and pays tax on her combined pension and wage, but is concerned for those who do not have this kind of income in retirement.

She said: “Listening to others really reveals a lot. A 78-year-old woman above basic state pension said to me that it is unfortunate, she gets £168 from a private pension but cannot claim for other benefits to support her. One of those months is taken up with the TV Licence payment. It is those sort of stories that don’t often surface, that people can often forget about.”

However, Ms Ritchie also concluded by questioning the level of support available for all pensioners, particularly given the challenging circumstances of the last year.

She said: “It is thought that spending on the state pension because of those who have unfortunately died during COVID-19 will fall by millions of pounds by next year. But besides that, you also have Inheritance Tax receipts increasing.

“The money is clearly there. It provides a lot of extra money for the Government. We are all asking where it is going, particularly with the triple lock freeze for a year.

“While a lot of people aren’t happy with this idea, some have accepted it as what it has to be. But do we all want to take bets on whether the triple lock will return for the following year, or even if it will return to the same level at all?”

A Department for Work and Pensions (DWP) spokesperson told Express.co.uk: “We are committed to ensuring that older people are able to live with the dignity and respect they deserve and the state pension is the foundation of support for older people.

“Since 2010, state pension has increased by over £2,050 in cash terms and we expect to spend more than £125 billion on benefits for pensioners in 2020/21.”

Pension Credit, the Government explained, is an income-related benefit created to help the poorest pensioners. Pensioners whose income is below £177.10 (for individuals) or £270.30 (for couples) per week may be eligible to receive the sum.

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