Hutton's report earlier this month said public sector pensions should no longer be related to final salaries, but by 2015 they will be connected to average career earnings.
This afternoon in his Budget speech, chancellor George Osborne commended Hutton on his review. He also announced the development of a single-tier system for the state pension and a flat rate of payments for pensioners.
National Association of Pension Funds' chief executive Joanne Segars said: "This is a turning point for pensions in the UK. Over half a million new pensioners a year will get a simpler and more generous state pension and reliance on means-tested benefits will be slashed. "For too long, we have put up with one of the most complicated and meanest state pensions in Europe. "This reform provides a clearer foundation for saving for old age. For the first time in a generation, people will know that it pays to save."
