Two out of every five pensioners are receiving less than £150 per week in state pension after changes to the system, new figures reveal.
Under the new state benefit, the maximum pensioners are able to claim is £168.80 per week. Yet a Freedom of Information request by Canada Life has revealed that just one-third of those claiming the new state pension receive more than £150 per week. This amounts to just 314,300 people.
Meanwhile, four in ten pensioners (or 365,300 people) are receiving less than £150. While it may not sound like a large amount, this discrepancy equates to roughly £1,000 per year.
State pension entitlement is based on a person’s National Insurance (NI) record in which people are eligible for the full state pension if they have paid full-rate NI contributions for at least 35 years.
However, the rules were changed in April 2016 - with the threshold jumping from 30 to 35 years - which means that people retiring now are straddling both the new and old system.
Furthermore, people can also receive more if they have a ‘protected payment’. This is due to the fact that benefits built up within both the old and new systems are worth more than the new flat rate.