Flat-rate state pension will be set at £155 per week


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Ministers are planning to introduce a new flat-rate pension of £155 a week, it emerged last night.

The reform to the basic state pension is expected to be announced next week but will not start until 2015 or 2016.

The current full state pension is £97.65 a week for men and women, but is topped up to ensure a minimum income of £132.60.

The £155 figure is higher than the £140 a week previously mooted by the Government. However, it makes no distinction between "rich" and "poor" pensioners.

Confirmation of the Government's intentions was given in Chancellor George Osborne's Budget on 23 March. However, the flat-rate pension would be available only for new pensioners reaching state retirement age, the BBC said.

The reform will mean the state second pension will be abolished. It would also bring "contracting out" arrangements to an end, where some pay lower National Insurance contributions because their second state pension is contracted out to their company final salary pension.