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Amendment of section 109 of Principal Act (conditions for receipt of State pension (contributory))
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46. Section 109 of the Principal Act is amended—
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(a) in subsection (1)—
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(i) by the substitution of the following paragraph for paragraph (a):
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“(a) subject to subsection (3), that the claimant has entered into insurance at least 10 years before attaining pensionable age or deferred pensionable age, as the case may be,”,
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and
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(ii) in paragraph (c), by the substitution of “subject to subsection (6D), that the claimant” for “that the claimant”,
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(b) by the insertion of the following subsection after subsection (1A):
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“(1B) (a) In the case of a claimant to whom section 108(1C) applies, who is, during the relevant period, in receipt of a specified weekly payment, the period or aggregate of periods during which he or she is in receipt of such a specified weekly payment shall be regarded as reducing his or her deferred pensionable age by the equivalent period or aggregate of periods, measured in days, that he or she was in receipt of such a specified weekly payment and the age referenced rate of State pension (contributory) shall be calculated accordingly.
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(b) In this subsection, ‘relevant period’ means the period beginning on the date on which the claimant attains pensionable age and ending on the date on which he or she was first awarded State pension (contributory).”,
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(c) in subsection (6A) by the substitution of “Subject to subsection (6D), in the case of” for “In the case of”,
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(d) in paragraph (a) of subsection (6B), by the substitution of “Schedule 2 or, if having attained deferred pensionable age, the age referenced rate of State pension (contributory) appropriate to that deferred pensionable age, if eligible,” for “Schedule 2”,
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(e) by the insertion of the following subsection after subsection (6C):
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“(6D) Notwithstanding any other provision in this Chapter, the rate of State pension (contributory) payable to a claimant who attains pensionable age or deferred pensionable age, as the case may be, on or after 1 January 2025 shall be calculated as follows:
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(a) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, between 1 January 2025 and 31 December 2025, either—
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(i) the age referenced rate of State pension (contributory) payable to the claimant calculated according to the aggregated contributions method, or
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(ii) the aggregate of—
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(I) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the yearly average approach multiplied by 90 per cent, and
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(II) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the aggregated contributions method multiplied by 10 per cent,
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whichever is the more favourable to that claimant;
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(b) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, between 1 January 2026 and 31 December 2026, either—
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(i) the age referenced rate of State pension (contributory) payable to the claimant calculated according to the aggregated contributions method, or
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(ii) the aggregate of—
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(I) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the yearly average approach multiplied by 80 per cent, and
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(II) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the aggregated contributions method multiplied by 20 per cent,
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whichever is the more favourable to that claimant;
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(c) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, between 1 January 2027 and 31 December 2027, either—
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(i) the age referenced rate of State pension (contributory) payable to the claimant calculated according to the aggregated contributions method, or
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(ii) the aggregate of—
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(I) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the yearly average approach multiplied by 70 per cent, and
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(II) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the aggregated contributions method multiplied by 30 per cent,
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whichever is the more favourable to that claimant;
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(d) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, between 1 January 2028 and 31 December 2028, either—
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(i) the age referenced rate of State pension (contributory) payable to the claimant calculated according to the aggregated contributions method, or
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(ii) the aggregate of—
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(I) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the yearly average approach multiplied by 60 per cent, and
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(II) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the aggregated contributions method multiplied by 40 per cent,
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whichever is the more favourable to that claimant;
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(e) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, between 1 January 2029 and 31 December 2029, either—
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(i) the age referenced rate of State pension (contributory) payable to the claimant calculated according to the aggregated contributions method, or
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(ii) the aggregate of—
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(I) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the yearly average approach multiplied by 50 per cent, and
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(II) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the aggregated contributions method multiplied by 50 per cent,
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whichever is the more favourable to that claimant;
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(f) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, between 1 January 2030 and 31 December 2030, either—
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(i) the age referenced rate of State pension (contributory) payable to the claimant calculated according to the aggregated contributions method, or
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(ii) the aggregate of—
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(I) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the yearly average approach multiplied by 40 per cent, and
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(II) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the aggregated contributions method multiplied by 60 per cent,
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whichever is the more favourable to that claimant;
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(g) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, between 1 January 2031 and 31 December 2031, either—
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(i) the age referenced rate of State pension (contributory) payable to the claimant calculated according to the aggregated contributions method, or
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(ii) the aggregate of—
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(I) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the yearly average approach multiplied by 30 per cent, and
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(II) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the aggregated contributions method multiplied by 70 per cent,
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whichever is the more favourable to that claimant;
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(h) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, between 1 January 2032 and 31 December 2032, either—
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(i) the age referenced rate of State pension (contributory) payable to the claimant calculated according to the aggregated contributions method, or
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(ii) the aggregate of—
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(I) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the yearly average approach multiplied by 20 per cent, and
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(II) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the aggregated contributions method multiplied by 80 per cent,
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whichever is the more favourable to that claimant;
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(i) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, between 1 January 2033 and 31 December 2033, either—
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(i) the age referenced rate of State pension (contributory) payable to the claimant calculated according to the aggregated contributions method, or
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(ii) the aggregate of—
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(I) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the yearly average approach multiplied by 10 per cent, and
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(II) the age referenced rate of State pension (contributory) payable to the claimant, calculated in accordance with the aggregated contributions method multiplied by 90 per cent,
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whichever is the more favourable to that claimant; and
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(j) in the case of a claimant who attains pensionable age or deferred pensionable age, as the case may be, on or after 1 January 2034, solely in accordance with the aggregated contributions method.”,
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and
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(f) in subsection (17)(a)—
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(i) in subparagraph (iii), by the substitution of “purposes,” for “purposes, and”,
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(ii) in subparagraph (iv), by the substitution of “subsection (6A), and” for “subsection (6A)”, and
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(iii) by the insertion of the following subparagraph after subparagraph (iv):
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“(v) long-term carer’s qualifying contributions attributable to him or her which are reckonable for State pension (contributory),”.
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