Details of the so-called State Pension top up, which allows people to boost their retirement income by making extra National Insurance contributions, have been published and hailed as a good deal by the pensions minister.
Speaking at a policy conference in London today, pensions minister Steve Webb said the changes were cost-neutral to government and would be available to people after they had retired and not just to people approaching retirement age. It will be available from October 2015 to all those reach state pension age before April 6 2016.
Webb said: 'It gives us their money and in return we would give them extra additional state pension for the rest of their lives, index-lined and [with] survivor benefits.'
Pricing was provided by the government actuary, Webb told the event, organised by the Reform think-tank, this morning.
'In the Red Book, we are booking £800m to £900m in revenue from this. Today we are publishing the prices,' he said.
'So, if you are to give me at 65-years old £890, I will give you an extra £1 a week in state pension. At 70-years old just [contribute] £779, [and] at 75-years old [put in] £674. So, a pretty good deal. Other options are available.'
The same prices are available for both men and women, and pricing has been developed up to 100 years of age.
This measure, along with the newly announced pensioner bond announced in last month's Budget, will be available from the National Savings and Investments in 2015.
Webb also urged industry delegates to 'pull down the curtain between pensions and long-term care'. He noted the new flexibilities on defined contribution pensions offered in the Budget and the opportunity to develop new and innovate products.
'Maybe in this brave new world we could integrate thinking about those two things,' he said.
Asked about his opinion of annuity buy-backs, he responded that he would have to 'chew on it'.
