The pension fund will be able to use about 1.5bn a year on new nuclear projects - enough money to support the country, including infrastructure - for 30 years. The new pensioner pay of those three decades also rises to 75,000 annually, a figure that will be equivalent to about 1.5 per cent of median age for a pensioner.
But there is debate as to whether these benefits will apply to the pensioner or not. Those who are eligible under the scheme would receive only about 0.2 per cent of the money their benefits depend on. The Government, in a statement, said the payments to pensioners and their constituents would be fair and proportionate, but that no pensioner should receive more than they need in that time.
But the Prime Minister’s Office will insist on more generous terms.
It has said that in line with its commitment to deliver the lowest possible public-sector pay of pensioners, it would assign extra funds within the next financial year to support existing nuclear and other generation and operation facilities throughout the future.
The plan is intended to keep the current level of pension and benefit rates, but cut it to 1 per cent for those who pay no more than they have in their pension, and to 1 per cent for those who do not pay more than they paid when they applied for the change.
The increase in pension rate will be phased back - up to 20 per cent in each new pensioner - and will not be retroactive. It does not mean that many pensioners who make the same amount of money would be able to take the extra money. But there is no suggestion that this will mean those who lose more money will be able to receive the additional money, and many have already changed their mind.
The prime minister has made it clear that if the new scheme is funded, the pay of those under it will be lower than their annual pension allowance. In 2011, the Government promised to increase benefits for pensioners by 2 per cent - more than double the current 2 per cent rise.
The savings from the existing funding will also be included in the changes. The Government will make adjustments after consultation with stakeholders, including those with vested interests in how the scheme gets funded, to help it meet this target.
The change also involves the addition of a new section 8 payment scheme. The new scheme will set the level of pay, and the payment for a pensioner, at the time of their birth
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