A revamp of the state pension system that could benefit women, carers and those with broken employment records deserves closer examination, according to work and pensions secretary Alan Johnson.
The change would see pensions being calculated on length of residency in the UK, rather than National Insurance (NI) contributions.
Johnson told Parliament that he was “very positive” about the idea, dubbed ‘the citizens’ pension’.
“I have an absolutely open mind, veering towards being very positive about it,” he said. “I think it is really interesting and deserves much closer examination.”
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To be entitled to the full state pension, men need to have made 44 years of NI contributions, while women have to make 39 years. Those who receive unemployment or incapacity benefit have their state pension credited as though they were working.
But people who are not employed, because, for example, they are looking after children or elderly relatives, will not be making NI contributions, and so may fail to meet the criteria for a full state pension.
