State pensioners living abroad will no longer be able to pay class two voluntary National Insurance contributions system.
State pension perk scrapped for thousands of retirees in Rachel Reeves’ Budget
A state pension perk has been SCRAPPED for thousands of retirees in the Labour Party Autumn Budget. State pensioners living abroad will no longer be able to pay class two voluntary National Insurance contributions system.
Chancellor Rachel Reeves told the Commons: “Taxpayers’ money should not be spent on pensions for people abroad who only lived here for a couple of years and may never have paid a penny in tax.
“The Conservative Party allowed thousands of people living abroad buy their way into the state pension for as little as £3.50 a week, debasing the purpose of our pension system.
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“And so I will abolish access to class two voluntary national insurance contributions for people living abroad, increasing the time that someone has to live or work in Britain to 10 years and increasing the contributions they must pay.”
You typically need 35 years of National Insurance contributions to get the full new state pension, which is currently £230.25 a week, or £11,973 a year.
Gerard Boon, managing director of Boon Brokers, said: “It is increasingly becoming less practical and ultimately unsustainable, pushing pension income ahead of wage growth. With an ageing population, more taxpayer money will be channelled into pensions, leaving less for other public services.
“As a result, it’s only a matter of time before the Government has to reconsider how the triple lock works and review its fundamental principles. For pensioners who are struggling to cover essential costs, practical steps such as claiming Pension Credit, checking council tax reductions, and accessing energy support can all make small but meaningful differences.”
Ms Reeves has confirmed she is raising the basic and new state pension by 4.8%.
The chancellor says this means “an increase of £575 per year for the new state pension, and £440 per year for the basic state pension”.
This is in line with the government’s commitment to the triple lock.