Understanding the State Pension part four a: How contracting-out can affect your total State Pension

The request was refused by Department for Work and Pensions.

Dear Department for Work and Pensions,

I would be very grateful if you could kindly explain the following information that i have recently found on the DWP Web site (cut & paste for ease of reference).

Baroness Altmann, Minister for Pensions, 15 October 2015— New State Pension

DWP Pensions Latest— 05/02/2016

As an example, if you have 30 years of NI contributions and have always been contracted-out, you would get a Starting Amount of £119.30 a week in April 2016. This is because the higher calculation figure is based on the old rules and you would get the equivalent of the full amount of basic State Pension. In other words, based on 2016/17 rates, no more than £36.35 a week will be deducted (£155.65 - £119.30 = £36.35) from the full rate of new State Pension if you have at least a 30 year NI record, even though the value of private pension you built whilst contracted-out could be higher than this. If you work for a further 9 years, you will reach the full amount of new State Pension (the equivalent of £155.65 a week in 2016/17) because you will have added 9 years’ worth of 1/35th of the full amount to your Starting Amount.

As you can clearly see by the above DWP example ,anyone with only "30 years" of NI contributions who have always been contracted out will get a starting amount of £119.30 a week in April 2016 and have an "Adjustment" of £36.35.

I have 41 years of full NI contributions and have always been contracted out. I will get £118.68 a week as stated in my State Pension Statement and have an "Adjustment" of £57.60 per week.

How can it be fair that i will get 62p less per week than someone who will have only contributed for 30 years compared to my 41 years.

How can it be fair that my "Adjustment" is £57.60 for 41 years when compared to the above DWP Example "Adjustment" of £36.35 for 30 years.

Kind Regards

Trevor

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John Slater left an annotation ()

Trevor,
The DWP probably won't provide the requested information as you haven't given it your full name. Info here explains:

https://www.whatdotheyknow.com/help/priv...

Operations FOI Requests, Department for Work and Pensions

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Trevor
 
Please see copy of your FoI request attached
 
 
 

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