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State pension income varies from £7 a week to £230 a week, DWP finds

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The amount of state pension money paid out to pensioners can differ by more than £200 a week – that’s a difference of £10,000 a year, according to the Department for Work and Pensions.

This is because the level of basic and additional state pension payouts can vary so much in the current system.

According to the latest DWP administrative data, state pension income varies from £7 a week to £230 a week. And 130,000 people get £7 or less a week and the same number of people get £230 or more a week.

State pension regulations have multiplied so much over recent decades and made the system so complex that people have no way of working out what they will get a week, and can't budget properly for their needs.

Pensions minister Steve Webb (pictured) said: "The range of state pension payouts at the moment is simply staggering. The current system is so complex and would baffle even Einstein. Worse, if people have no idea what they will get, they can't make sure they have enough savings for their retirement.

"We can't go on playing roulette with pensions. A flat-rate single-tier state pension will restore simplicity and give people certainty instead of chance. And it will provide a sure foundation for further saving."

The state pension is made up of the basic state pension and various additional state pension entitlements. It will be replaced by a simple flat-rate state pension for new pensioners set above the level of the means test, currently estimated at approximately £140 a week.

A White Paper will set out further details later this year.