Pensions

My view is that older people have a right to dignity and security in retirement. This means that as many people as possible should have sufficient state and private pension rights to be lifted clear of the means-test. In contrast, Government policy is to force more and more pensioners to claim means-tested top-ups simply in order to achieve a decent income in retirement.

I am especially concerned about the position of older pensioners who are, on average, considerably poorer than newly-retired pensioners. This is why the Lib Dems are committed to a substantial increase in the pension across-the-board for older pensioners. Such an increase does not require anyone to undergo an intrusive means-test and is guaranteed to be taken up by those who are entitled. By contrast, the Government's pension credit is likely to go unclaimed by at least a million poorer pensioners - even on the Government's own estimates.

In addition to Lib Dem plans to increase the state pension, you may also be interested to know that we have two further major proposals which will be of benefit to pensioners.

The first is to abolish the unfair council tax, which hits pensioners who have worked hard and saved hard especially harshly. Replacing the council tax with a local tax related to ability to pay would benefit the vast majority of pensioners. We also believe that long-term care costs should be met for all pensioners without facing a means-test or being forced to sell their home.

Together, we believe that this package of measures will bring a significant financial benefit to pensioners and will help to secure our goal of dignity and security in old age.

A universal citizen's pension

The Lib Dems have argued for the introduction of a universal Citizen's Pension, available to all pensioners, which will be linked to earnings and be based on residency rather than contributions. This will especially benefit women and carers with broken employment records, and restoring the link to earnings will ensure that pensioners can genuinely share in the growing wealth of the nation. It will also be paid at a significantly higher level and remove the need for means-testing.

We also support the move towards creating a low-cost national pension saving scheme, based on auto-enrolment with the option of opting out. There is certainly an argument for compulsory employer contributions, provided that they are phased in over time and safeguards are put in place to protect small businesses from spiralling costs, and this is something that we will be exploring once the Government brings forward its White Paper.

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