Women who take career breaks should not end up being penalised when it comes to pensions, the Conservatives said today, as the party unveiled its own plans for pension reform.
Shadow Work and Pensions Secretary David Wiletts said that, under a future Tory Government, pension rules that penalised women who took career breaks would be scrapped.
There would be an automatic state pension for all, regardless of how many years people contributed to the scheme.
Willetts said: “The pension system as it exists today is biased against women. It was designed for the days when men earned their pensions by work and women by marriage. It is much less well suited to a modern world.
“We need to modernise it so that it offers a fairer deal for women. We are going to make the rules for contributory pensions family-friendly for the first time. We will offer women a better deal by properly recognising the contributions they make at work and at home,” he added.
The pensions’ system was currently too inflexible and needed to fit better into how people led their lives, he added.
The specifics of his reforms include bringing the contributory principle for women up to date by scrapping the rule that says if you’ve worked for fewer than ten years, you cannot receive anything from the basic state pension.
This would be replaced with a pension for everyone who has paid National Insurance contributions.
People who have not made NI contributions in previous years will be able to “buy back” their state pension rights.
The party is also going to examine ways of ensuring that people earning less than Ł79 a week, and who do not build up entitlements to a state pension, can still qualify to do so.