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Your state pension and benefits

New state pension

By Paul Davies

Article 3 of 5

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New state pension

Discover how the new state pension works and what you should get under the new system.

The new state pension

After years of complaints about how complicated it is, the state pension has changed radically. Since April 2016, in general the system has become simpler and fairer, but there are some catches you need to know about. Currently, the basic state pension is £122.30 a week (rising to £125.95 in April 2018). Some people get some additional state pension on top of this.

The full level of new state pension for 2017/18 is £159.55, although you could get more or less than this. It's worth knowing at the outset that you won't get any less than what you would have received under the old system. To get any state pension, you'll need at least 10 qualifying years on your National Insurance (NI) record. These are years when you've been either paying National Insurance or receiving National Insurance credits. 

For more - how much state pension you'll get.

The impact of contracting out

You get credits for things such as being too ill to work, or being a carer or unemployed. The first change is that some women and carers are likely to be better off under the new system because their credits will count for more than they did previously. Likewise, self-employed people are likely to be better off under the new system because their contributions will count for more in the long run. 

The second change is that the number of years of NI contributions you need in order to qualify for the full £159.55 a week has gone up from 30 years to 35 years, although you can make up the difference with some additional state pension. Additional state pension - sometimes called second state pension - can boost your pension to more than £159.55 a week. 

If you've been 'contracted out', so you've been paying less National Insurance but getting a higher private pension, you're likely to have a starting amount of less than £159.55 in April 2017, but you can build up to that level through further contributions.

For more - what was contracting out?

State pension age

If you reached state pension age before the 6 April 2016, the changes won't affect you. 

From April 2016, the pension will continue as it has before, the old system will apply even if you decide to defer or delay drawing your state pension. 

For more - state pension age calculator.

There's more about the pros and cons of deferring your state pension and topping it up elsewhere in this guide. 

  • Last updated: November 2017
  • Updated by: Paul Davies

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