Simon Read: Why is the Government making some pensioners second-class?

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The Independent Online

There was some potential good news for pensions this week when it was revealed that the new flat-rate state pension will be at £155 a week, rather than the previously expected £140. With the current minimum income at £132.60, that's an improvement. But it's going to be four or five years before pensioners will benefit and then only those that retire after the new scheme is introduced. That will leave existing pensioners, and those that retire before 2015 or 2016 (the date for the introduction of the flat-rate pension is yet to be decided) at an unacceptable disadvantage.

The Government will announce fuller details of the new scheme on Monday. I hope that it realises that creating a future inequality is not on. Plans to increase women's retirement age four years early have already created huge controversy (see "Cutbacks hit pension hopes for 500,000 women", page 53) that you'd expect the Government would think again before creating further problems.

In this case, the solution is easy: when the new flat-rate state pension scheme is introduced, it must be for all. Leaving today's pensioners – and those that retire before 2015-16 – as second-class citizens just won't do.

Mortgage fees hit a new high this week. A 4.99 per cent two-year discount buy-to-let deal from Chorley Building Society charges borrowers a whopping £2,500 to arrange the mortgage.

This is the highest fee yet that I've encountered and I just can't see any justification for it. The usuual defence from lenders is that without the high fee they wouldn't be able to offer such low rates, but that's a disingenuous argument. They could just increase the rate and cut the fee, which would make comparing deals much easier for anyone taking out a mortgage.

Lenders have every right to make a profit on their mortgage deals, but the costs should be transparent. Offering a low interest rate with high fees is designed to mislead borrowers.

It's time the practice was ended and fees were reduced to simply covering the costs of admininstration – or scrapped altogether. Until then, it will continue to look like lenders are resorting to shabby sales practices.

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