Minister defends curb on pensions

Steve WebbIt is not fair to taxpayers that a growing number of people overseas can claim UK pensions even though they have "never put a penny" into the system or even been here, pensions minister Steve Webb said as he defended a proposed curb.

The Pensions Bill, part of the Government's legislative package to be unveiled in Wednesday's Queen's Speech, will seek to end the practice of women being able to claim solely on the basis of their husband's contributions or vice-versa.
Fewer and fewer UK residents take advantage of the "anachronistic" measure but the numbers overseas have risen in recent years, requiring action, Mr Webb said.

Existing pensioners will be unaffected but new claims at home and abroad will be barred from 2016 as part of a significant overhaul of the system that will see the introduction of a single-tier pension, worth around £144 a week in today's money.
The simplified retirement set-up will be based solely on personal contributions.

Mr Webb rejected suggestions that he highlighted the impact on overseas spouses in an interview with the Daily Telegraph newspaper in an effort to counter the appeal of the UK Independence Party, after its strong showing in last week's county council elections.

"Not at all," he told BBC Radio 4's The World at One. "I think the fact the we do pay over 200,000 pensions outside the country, many people who may not even have visited the country, would strike most people as not fair. And we are going to change it."

The present cost to the taxpayer of those payouts, worth up to £3,500 a year, is put at around an annual £410 million.

"We're not saying we care who you marry, that's your choice. What we are saying is: don't expect in the future that when you marry somebody they acquire rights in the British system even if they haven't put in," Mr Webb said.

The Queen's Speech will also feature a Bill giving increased rights to consumers but reducing "burdens" on business, aimed at saving £4 billion over 10 years in more effective protection and better understanding of consumer rights. The expected legislation is designed to consolidate consumer rights, currently split between eight pieces of legislation, into one place.
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