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'Thousands of pensioners' could benefit from payment top-ups

03 Apr 2014

The Government has announced that individuals over the age of 61 will be given the option of topping up their pension payments by up to £25 a week.

April 2016 sees the introduction of a new flat rate state pension, worth around £144 a week, which will replace the existing two-tier system plus various means-tested benefits.

However, those who are due to retire before 6 April 2016 could stand to lose out financially, and are being offered the opportunity to top up their State Pension by between £1 and £25 per week.

The facility will apply from 12 October 2015 until 1 April 2017, for individuals who are entitled to the basic State Pension or Additional State Pension before 6 April 2016.

Around 265,000 people are expected to make use of the top-up, which will involve paying a lump sum via a new form of voluntary national insurance contribution, known as Class 3A.

However, some experts have warned that the scheme may not offer the same value for money as an existing top-up scheme.