State Pension
Retirement age for State Pension age will increase to 66 in 2014, 67 in 2021 and 68 in 2028. Arrangements will be put in place to allow people to postpone receipt of the State pension and to make up contribution shortfalls.
New Auto-Enrolment Scheme
Employees (aged 22 or over) will be automatically enrolled unless they are a member of their employer’s scheme - which provides higher contribution levels or is a defined benefit scheme).
The State contribution will equal 33 per cent tax relief. The current system of tax relief at the standard and higher rates is to be phased out.
One-off bonus payment for people who remain in the scheme for more than five years continuously.
Small defined contribution funds may be transferred into the scheme.
Public Service Pensions
A single new pension scheme will be introduced for all new entrants, with effect from 2010.
Tracing service and dormant pension benefits
A tracing service will be put in place to facilitate the tracing of pension rights by former employees and scheme trustees.
Consideration will be given to the establishment of a State administered fund into which the assets of untraceable accounts would be transferred.