The Queen’s Speech set out the personal finance agenda for the year ahead, as 15 bills were outlined for the government’s legislative programme.
Two of the main personal finance related bills were a cap of social care costs and the introduction of a flat-rate State Pension, at £144 per week.
The cap on social care costs follows the recommendations made by the Dilnot Commission, although there was no indication in the Queen’s Speech at what level this lifetime cap would be introduced.
It was announced in the Budget in March that this lifetime cap would be introduced in 2016 at a level of £72,000.
The means testing threshold would also be increased to a more generous £118,000, with those with assets up to this level able to claim assistance from their local authority.
In the forthcoming Pensions Bill, the government will aim to legislate for a single-tier pension worth £144 a week at today’s prices.
This will also be introduced in 2016, a year earlier than originally planned.
Those planning for retirement will be able to factor in the receipt of around £7,500 a year in State Pension income when planning for their own retirement income needs.
It will also see the date at which the pension age is increased to 67 brought forward to 2026, reflecting rising life expectancy.
As the Baby Boomer generation reaches retirement, we expect the focus of the government to increasingly become on the personal finance issues of income in retirement and care fees.
