What pension liabilities are worth to pensioners?

By Andrew Burdett-Barrett, BBC News Pension liabilities are an area where the Government has tried to focus attention, but is it effective?

Pensioners are in a much better position to benefit from changes in pension policy than other groups.

Pensioners receive an average of £4,500 a year, compared with just £2,500 for those aged 65 and over, and it is the older pensioners that are the most likely to benefit, according to the latest Office for National Statistics (ONS) figures.

It shows the average monthly pension payment in England is £26,878 compared with £20,717 for those 65 and above.

The biggest monthly increase is seen in the UK, where pensioners receive £27,945, with an average monthly benefit of £24,000.

This is because pensioners are entitled to a smaller benefit cap, compared to other groups, and are therefore eligible to receive more in benefits.

The latest ONS figures show pensioners were more likely to receive their pension income than other people, as their pension fund is smaller, and because their benefit cap is lower.

However, this is not necessarily the case for all pensioners.

People aged 60 and over were more than three times as likely as people aged under 65 to receive a larger benefit cap compared with other groups of pensioners, according the ONS.

However the difference is less than one-third of one per cent, so it is not as large a difference as the difference between the UK and the rest of the world.

What about income?

What about the amount of pension income that pensioners should be able to claim?

According to the Office for Budget Responsibility (OBR), pensioners earn an average annual salary of £18,000, and they can claim an income supplement of £1,000 to £2 and a benefit cap of £5,000 per annum, or £3,000 for the highest rate of benefit.

These benefits are based on the pensioner’s level of earnings in the year in question, and the OBR also includes other pensioners’ income as well.

For example, people with a job are exempt from the pension cap, but those who do not have a job will receive a smaller supplement.

The higher the pensioners pay, the lower their income will be.

The ONS defines the pension benefit cap as a maximum amount of income that can be claimed for any pensioner for any tax year.

The lower the pension is, the less pensionable income it is likely to be.

What should I expect if I want to claim more?

The Government has made changes to the way pensioners and other pensioner groups are paid to raise awareness of pension liabilities.

This has been accompanied by changes to how pensioners can claim for income.

In September, the Pension Protection Bill introduced changes that would see people eligible to claim up to a maximum of £3.7 million from a pension, but these would only be available to those in the most secure pensioners pension scheme.

The new pension protection system will also see pensioners eligible to contribute to the UK’s pension plans, but will not be able use the pension fund to pay for the benefits.

There will also be a change to the rules around how benefits are calculated, with benefits now calculated on the basis of pensioner level of income rather than on the income of those in a lower pension scheme, which will make it harder for older pensioner pensioners to benefit.

However this is an area of the law that will be worked on in future, with the OBA working with the Government on how to make the new rules more flexible and fairer for older people.

Will this be enough to stop pensioners being more financially secure?

Yes.

The Government announced last week that it was changing the rules for pensions to make it easier for pensioners in the least secure scheme to claim for pension income, as they are now more likely than other pension groups to earn lower incomes.

However it will not stop older pensionering from being financially secure.

If pensioners have a higher income, they will be more likely make more contributions to the system, but they are still more likely then younger pensioners who are more likely still to make less.

So it is worth keeping an eye on what is happening to pensioner incomes over the next few years, and how this affects older pensioning, if anything changes.

It is also worth keeping in mind that the OBB has not published figures for the latest year in which it has published data on pensioners benefits, so the current rate of inflation may be used as an indicator of the level of financial security for pensioner earners.

What happens if my pension gets higher?

Pensioner benefits are subject to tax and there is a cap on how much can be taken out of your pension fund, and when you are eligible to make contributions.

However if you lose your job, you will lose your pension, so you cannot take out more.

If you have had your pension withdrawn,