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This article is for information purposes only.

Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.

There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.

Pension scheme fails to deliver desired results

The government is being urged to take proactive measures to make pension scheme reach more people

A pension scheme launched by the Department for Works and Pensions is not benefitting the number of people it originally intended. The pension scheme is intended at carers of disabled people, but it has failed to reach the targeted number of beneficiaries, making the scheme not worthwhile. At present, it is reaching only 97 per cent of those intended. The scheme is aimed at helping carers of disabled people build their state pension entitlement. The government is now being urged to take proactive measures, so that the benefits of the scheme reaches more people who really need it and the scheme actually delivers.

According to information obtained from the Department for Work and Pensions, through a Freedom of Information Act request by Royal London, merely 3,524 people claimed the national insurance credit in the year 2016-17 as against the figure of 160,000 estimated by the DWP when it introduced the scheme. According to the scheme, credits will add £237 annually to a carer’s state pension, which means a total amount of £4,700 over the course of a typical 20 year retirement period. But, as of the current scenario, even if 155,000 carers miss out on the credit each year, it will result in a total loss of over £700m. Now, Royal London and Carers UK are calling on Government to take a better approach to make sure carers benefit from the scheme.

Royal London policy director Steve Webb said that these schemes are introduced with the best of intentions, but they become no more than window-dressing if virtually nobody actually takes them up. Governments cannot simply hope that people find the information on official websites or rely on the occasional ministerial press release. It is time for proactive communications with those who are meant to benefit so that far more people get the help to which they are entitled.

Carers UK policy and public affairs director Emily Holzhausen said that the carer’s credit is a good scheme but it needs much more effective publicity. Caring often impacts negatively on health, wellbeing and ability to work and yet carers’ contribution to the economy is worth billions a year. They should not lose out financially in retirement as well.

Important:

This article is for information purposes only.

Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.

There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.