Pension plan amount criticised by union

Frances O'Grady the General Secretary of the TUC.
Frances O'Grady the General Secretary of the TUC.

Changes to the pension scheme which could leave thousands of people across the Fylde coast worse off have come under fire.

The Government announced earlier this year it is replacing the complex assortment of state pensions and top-ups with a single payment worth around £144.

This flat-rate ‘single-tier pension’ will take effect in April 2016, and will affect those who reach state pension age from that date onwards.

Trade Union Congress (TUC) general secretary Frances O’Grady said it supported the single-tier pension in principle, but added that the initial rate of £144 a week was far too low.

And the North West’s TUC representative, Alec McFadden, said for many it would be unworkable.

He added: “The reality is nobody is going to be able to live on it. What’s the point of going in a pub, asking for a pint and getting a half? That is what is happening here.

“Blackpool and the Fylde, along with Merseyside, has the largest percentage of pensioners in the North West – it is a disgrace that many of these people, who worked 16 hour days cannot afford to heat their homes or eat three meals a day.”

The TUC study claims anyone on a median income of £26,000 a year, with a full employment record, will be worse off when the new pension is introduced.

Such a person retiring in 2030 would receive £1,500 a year less than under the current system, it claimed.

But a Department for Work and Pensions spokesman said: “Most people retiring by 2040 will be better off over the course of their retirement with the new state pension than under the current system.

“The flat rate will provide a fair base, set above the basic level of means test, helping people to know how much they need to save for the kind of retirement they want.”

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