Radical new pensions policy for women
He announced that the rules which penalise women who take career breaks will be scrapped by an incoming Conservative government, which will offer the prospect of an automatic state pension for all, regardless of how many years they contribute to the scheme.
Mr Willetts said: "The pension system as it exists today is biased against women. It was designed for the days when men earned their pensions by work and women by marriage. It is much less well suited to a modern world. We need to modernise it so that it offers a fairer deal for women. We are going to make the rules for contributory pensions family-friendly for the first time. We will offer women a better deal by properly recognising the contributions they make at work and at home."
Mr Willetts declared: "Tony Blair promised to end the stigma of means testing forever. That was all talk. Twice as many women as men are having to rely on means-tested benefits in retirement. Our policies will help reverse the spread of means tests."
He unveiled the plans to modernise the contributory state pensions system to make them fairer to women, and argued the case for a more flexible approach that fits with how people live their lives, during a keynote speech to the Institute for Public Policy Research.
The reforms include bringing the contributory principle for women up to date by scrapping the rule which says that if you've worked for less than ten years, you can't receive anything from the basic state pension, and replacing it with a pension for everyone who has paid National Insurance contributions; granting better, more flexible pension rights to people who stay at home to look after children or sick relatives; making it easier for people who have not made National Insurance Contributions in previous years to "buy back" their state pension rights; and examine ways of ensuring that people earning less than £79 a week who don't build up entitlements to a state pension, can still qualify to do so. This reform would not affect anyone's take-home pay.
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Promoted by Mark Slater on behalf of Torridge & West Devon Conservatives