An amendment to the pensions bill on national insurance contributions is in danger of not being passed by the House of Commons because it is "technically flawed", according to the Government.
The House of Lords voted the amendment through last night but the Government says it would have to consider cost implications.
The amendment, by Baroness Hollis, would allow people with broken career histories to extend the time in which they can make up to nine years additional national insurance contributions to top up their basic state pension.
Stewart Ritchie, director of pensions development, says: "On the face of it this is a welcome amendment that will enable more people with broken work histories, predominantly women, to get a full basic state pension. It would also remove a trap for the unwary when making voluntary pension provision.
"Currently anyone receiving a reduced Basic State Pension and subject to means testing in retirement will lose private pension saving on a pound for pound basis up to the level of the full Basic State Pension.
"Anything that makes it easier for people to top up their Basic State Pension and avoid the pound for pound trap must be welcome.”
Currently more than 90% of men and just 25% of women retire with a full basic state pension in their own right.
Ritchie says: “Anyone who approaches retirement in the next decade who has been caring for 30 hours a week or more for elderly parents will have no pension rights for that. Anyone who now or in future has two part-time jobs cannot add them together to get a pension. Anyone who now or in future is a grandparent who takes on childcare cannot get a stamp. In other words, there are and will continue to be groups of women who are living valuable lives of care and support who will be outside the pension system and will risk retiring into poverty.”
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