A growing number of campaigners and pension experts in the UK are calling on the Department for Work and Pensions (DWP) to introduce a universal state pension worth around £28,500 a year. This comes amid concerns over the growing inequality between pensioners who receive the new State Pension and those still on the basic State Pension system.
Currently, retirees in the UK receive different pension amounts depending on when they reached pension age. Those who retired after April 6, 2016, are eligible for the new State Pension, which pays up to £221.20 per week (about £11,500 per year). However, many who retired earlier remain on the old basic pension rate, which is significantly lower unless topped up with additional payments like Pension Credit or SERPS.
The Push for a Universal Flat-Rate Pension
Experts and advocacy groups say the two-tier system is unfair and leaves millions of older pensioners struggling to make ends meet, especially during the ongoing cost of living crisis. To fix this, they are proposing a universal State Pension rate that applies equally to all retirees, regardless of when they reached pension age.
Their suggested rate—£28,500 a year—would align more closely with the real cost of living, especially for elderly people who often face higher healthcare, heating, and food costs. That’s equivalent to £548 per week, which is over twice the current maximum payment under the new State Pension.
The campaign is backed by former pensions minister Baroness Ros Altmann, who has long called for reforms to address pensioner poverty and system inequalities. She recently stated that the gap in income between older and newer pensioners is “shocking” and unsustainable.
Millions Left Behind
There are currently over 12 million people receiving the State Pension in the UK. Of these, around 9 million are believed to be on the old basic State Pension. Many of them receive less than £9,000 per year, especially women who took time off work to care for family and thus have fewer qualifying National Insurance years.
For this group, the proposed flat-rate pension would be life-changing.
Campaigners argue that a universal system would eliminate confusion, remove injustice, and help prevent older people from falling into poverty. They also point out that a simpler system would reduce administrative costs and errors in pension payments, which are common in the current setup.
Can the Government Afford It?
Critics of the proposal argue that increasing the State Pension to £28,500 per year for all would put massive pressure on public finances. They warn it could cost the government tens of billions of pounds more each year.
However, supporters say the current system is already inefficient and that funding a universal pension could be balanced by simplifying means-tested benefits and re-evaluating tax reliefs given to high-income pension savers.
There’s also a growing debate about fairness across generations, especially as today’s young workers may end up with fewer workplace benefits than current retirees.
What Happens Next?
So far, the DWP has not announced any plans to introduce a universal flat-rate pension. However, pressure is mounting ahead of the next General Election, with pension fairness becoming a hot topic among older voters.
Groups like Silver Voices and the National Pensioners Convention continue to push the issue in Parliament and in the media.
Until then, millions of pensioners will have to continue relying on a system that many say is outdated and unfair.
Grant Wilkinson is a content editor at The Landscape Insight, where he helps to produce engaging and informative articles about the industry. With a keen eye for detail and a passion for quality, Grant works closely with a team of writers and designers to bring the latest news and insights to readers. You can reach Grant at – Grant@landscapeinsight.com or on Our website Contact Us Page.
