SOME two million retiring pensioners will miss out on getting the full new state pension when it comes into force next year.
About 3.5 million workers will reach their state pension age between 2016 and 2020 but, out of these, only 45per cent will be entitled to a full new state pension of at least £148.40, pensions firm Hargreaves Lansdown has said.
The current means-tested state pension, which is made up of a basic payment and top-ups linked to career earnings, is set to be replaced with a single payment of at least £148.40 in today's money.
People who reach pensionable age after April 2016 will see their national insurance contributions count towards a "single tier" amount.
But a freedom of information request submitted by Hargreaves Lansdown has revealed that just 45per cent of those retiring between 2016 and 2020 are set to receive the full state pension amount.
It includes one million pensioners in the first five years who are set to receive less than 86per cent of the new state pension.
The majority of people falling short of the full state pension are likely to have been contracted out during their working lives. Others who get less than 100per cent are likely to be those with interrupted National Insurance contribution histories, such as mothers and the self-employed.
Tom McPhail, head of pensions research at Hargreaves Lansdown, said: "The new state pension will ultimately be a simpler and fairer system. However, in the short term it will be complicated and many people are likely to get less than they may expect."
He added that, with new pension freedoms meaning that people will be able to spend all their private pension savings, it is imperative that workers receive a proper state pension forecast.
Mr McPhail said: "Without this, they could get a nasty shock when they do reach state pension age."
The Department for Work and Pensions (DWP) insisted that no one would lose out as a result of the changes and many people would be better off.
While contracting out is being abolished - meaning that payments will become increasingly similar over time - the DWP insisted that it had always made clear that the differences could not be eliminated overnight.
A DWP spokesman said: "Language about people 'missing out' is utterly misleading.
"Those retiring when the new state pension is in place will get at least what they would have got for the NI contributions they have paid in the current system, and many will get more.
"Our historic pension reforms will create a simplicity that hasn't existed in decades, giving people a greater sense of economic security and peace of mind in retirement.
"The new state pension will tackle inequalities of the past, with women, carers, lower earners and the self-employed set to benefit the most."
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here