How much have you thought about the state pension?

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Despite a lot of discussion in the media this week, I’m guessing for most of us the answer is not much, not yet anyway.

But what is it for and is it fair? 

What will I get and when? 

Will it still be there when I come to retire? 

These were all challenges that I spent last Saturday in a hotel in Bloomsbury, London with 50 strangers deliberating over, with the amazing and skilled facilitation of Suzanne Hall and her team at the Policy Institute at King’s College London.  And it was fascinating. 
 

How much is the weekly state pension entitlement?

In a quick straw poll of friends, nearly all don’t know what the full weekly state pension entitlement is.  Maybe that doesn’t matter I hear you cry.  None of them are that close to state pension age.  But if you don’t know how much it is, nor what some of the factors are that could make you ineligible for it when the time comes, how can you ensure you have enough income in retirement? 

Turns out my friends aren’t so different from the 50 members of the public we met. People I spoke to admitted they had heard of the “triple-lock” but, until then, had no idea what it was. Politicians and journalists take note, it’s easy to bandy the phrase around but much harder to ensure it is understood. 

Education about the state pension came through as absolutely critical to ensuring people are taking informed decisions throughout their lives. With heavy emphasis on ‘throughout their lives’, not just as they approach retirement. If you are self-employed or taking time out to care for a family member, then you should know what the implications might be for your state pension entitlement. 

Is the current state pensions system fair?

Beyond our individual responsibilities, is the current system fair? And is it sustainable? This is particularly important given that increasing life expectancy in the UK unfortunately walks hand in hand with widening health inequalities. Our participants suggested that people should be helped to work longer alongside providing an improved safety net of support for those that can’t – possibly through early access to the state pension. Just one of many potential and constructive ideas for reform.

It’s patently clear to me now that if we are going to help people make the most of longer lives, then we need much more public discussion about the state pension. And if we want to ensure the state pension is effective in the long-term that we need to engage both the public and decision-makers in shaping that change. 

PS And in case anyone else (in or outside the pensions world) has realized they don’t actually know what the triple-lock is – it’s the government policy which sets out that the state pension must rise each year in line with the highest of three possible figures, inflation, average earnings or 2.5%.