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State Retirement Pensions

Volume 486: debated on Tuesday 20 January 2009

To ask the Secretary of State for Work and Pensions if his Department will consider the merits of allowing national insurance contributions of one half of a married couple over and above what is required to trigger entitlement to a full state pension to be transferred to a spouse if they have a shortfall in their own contributions. (247888)

[holding answer 15 January 2009]: This is not a practicable proposal.

The need for such a transfer mechanism will be very limited under the reformed state pension scheme because the majority of both men and women in the UK—over 90 per cent. for those reaching state pension age in 2025—will have entitlement to a full basic state pension and are therefore less likely than under the current scheme to need to access their spouses' contributions.

It is not necessarily the case that qualifying years of contributions beyond those required for entitlement to a full basic pension are in effect surplus and not generating pension entitlement. State second pension will accrue on paid Class 1 contributions. Therefore on transferring the contributions from one spouse to another, the spouse donating the contributions would also be forfeiting any state second pension entitlement derived from them.

Overall the complexity for both customers and staff inherent to such an arrangement could not be justified given the relatively low numbers it could potentially benefit in the future under the reformed scheme.