Pensions in The United Kingdom

Pensions in the United Kingdom fall into three major divisions and 7 sub-divisions; State Pensions (Basic State Pension and State Second Pension (S2P)), Occupational Pensions (Defined Benefit Pension and Defined Contribution Pension) and Indiviual/Personal Pensions (Stakeholder Pensions, Group Personal Pensions and Self-Invested Personal Pension). Personal accounts, automatic enrolment and the minimum employer contribution will be new policies joining these from 2012.

The state provides basic pension provision intended to prevent poverty in old age. Until 2010 men over the age of 65 and women over the age of 60 were entitled to claim state pension; from April 2010 the age for women is gradually being harmonised to match that for men. Longer-term, the retirement age for both men and women will rise to 68 by no later than 2046 and possibly much earlier.

The basic state pension, then known as the "Old Age Pension" was introduced in the United Kingdom (including Ireland) in January 1909. A pension of 5 shillings per week (25p, equivalent, using the Consumer Price Index, to £19 in present day terms), or 7s.6d per week (equivalent to £29 today) for a married couple, was payable to a person with an income below £21 per annum (equivalent to £1600 today), following the passage of the Old Age Pensions Act 1908. The qualifying age was 70, and the pensions were subject to a means test.