The Government has outlined its quest to get people to work longer, by offering a lump sum payment in excess of £30,000 for people wanting to delay their state pension by five years.
As part of a five-year strategy announced by the DWP yesterday, secretary of state for Work and Pensions Alan Johnson said people choosing to defer their pensions for five years and retiring at age 70, would be eligible for a one-off payout of £32,306 from April.
The DWP even went as far as sketching a figure of £77,090 for those people wishing to extend their working ability by ten years, pushing retirement to 75.
The DWP highlighted its pledge under a banner of ‘choice’ for older workers to decide how and when they retire, while falling within a campaign to get at least one million older people to stay within their employment.
Other steps include legislating to combat age discrimination and tax reforms in order to help people to continue working after drawing their occupational pensions.
Johnson said: “All the research shows that people want the choice about how and when they retire. Already over 1 million people have chosen to carry on working in some form past pension age and I want to encourage people who still have something to offer in the workplace to keep on working.”
The Five Year Strategy calculations are based on the principle of what people are entitled to receiving a state pension of £105.
Minister of State for Pensions, Malcolm Wicks adds the Government is trying to eradicate the system where people perfectly capable of working, were forced into retirement due simply to their age.
He said: “It is not about forcing people to work longer, far from it. Instead we want the workplace and the state to be flexible enough that where someone wants to work and can do so we can accommodate this.”IFAonline
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