ROS ALTMANN

UK pensions are in the midst of the biggest shake-up in generations – the most fundamental reforms since before the Edinburgh International Festival first took place or the Stone of Destiny was famously removed from Westminster Abbey.

A whole raft of reforms are under way to protect the living standards of today’s senior citizens while at the same time encouraging the pensioners of tomorrow to start saving and preparing for later life.

Our promise to safeguard key pensioner benefits, despite the tough economic climate, saw nearly 800,000 households in Scotland receive hundreds of pounds each in Winter Fuel Payments last year.

And the triple lock, the mechanism which raises the State Pension by at least 2.5 per cent each year, is guaranteeing Scotland’s 1 million pensioners a meaningful annual increase once more – something they were denied in the past.

Right now, we are preparing to introduce a new State Pension that, when it comes in next year, will sweep away years of baffling bolt-on complexities and offer unprecedented clarity for the future.

This reform will particularly benefit many women and the self-employed, who may receive higher pensions. Across the UK, 650,000 women will benefit by getting on average £8 a week more in the first 10 years of the new system.

While the new State Pension will give people much more clarity over what they can expect to receive from the state in their old age, our Automatic Enrolment policy is also making it easier for people to save into their own workplace pension from an earlier age.

This has helped turn around the long-term decline in private pension saving, with 75 per cent of eligible workers in Scotland now saving into a workplace pension - a 10-year high.

Plus, in a ground-breaking move, people over the age of 55 are now able to access their pension savings in a way that best suits them, subject to their marginal rate of income tax. No longer are they forced to buy a poor value or potentially unsuitable annuity.

It’s a reform of which Scotland’s most famous economist, that most distinguished proponent of individual freedom, Adam Smith would surely have been proud.

Alongside this, we have outlawed age discrimination in the workplace for the first time in history, made flexible working a realistic option for more people, and radically improved our approach to helping jobseekers in their 50s and early 60s get back into work.

Taken together, the initiatives we have delivered since 2010 are empowering working people to get on at every stage of their lives and take charge of their own later life.

But a year on from Scotland’s momentous decision to remain a part of this United Kingdom, it is unsettling to think how close we came to saying goodbye to the secure retirements offered not just by prudent policy decisions but by being part of a successful, single UK-wide economy.

As more and more people feel the effect of the way this UK government has safeguarded the pensions of today and tomorrow, I am sure growing numbers will resolve that – on pensions as on other issues – Scotland made the right choice in September 2014.

There is still much more to do. By the end of this Parliament, I am committed to making sure the State Pension is worth more than it has been in decades; that everyone in full time work has the opportunity to pay into a workplace pension; and that saving for later life is cheaper and easier than ever before.

A thriving Scotland, as part of a thriving UK, can achieve this and deliver a fair deal for tomorrow’s pensioners as well as today’s.

Baroness Altmann is Minister for Pensions in the UK government