Pensions may be stripped of means testing criteria in the coming years.
A universal pension rate might be implemented if new proposals are accepted.
Saving for retirement will be encouraged by the government when it reforms the current complex pension system into a clearer flat-rate scheme.
Work and pensions secretary Iain Duncan Smith suggested that a universal pension payment could be made to all pensioners in the future at an event organised by Age UK. He did not to provide a figure, however, experts have speculated that the basic state pension could be set at £140 a week if means tested benefit is scrapped.
The proposed changes should make it fairer to people who fail to make enough National Insurance contributions to qualify for a full state pension after opting out of work to raise a family.
Mr Duncan Smith said: “The state pension system is so complex that most people have no idea what it will mean for them now and in their retirement. And too many people on low incomes who do the right thing in saving for their retirement find those savings clawed back through means-testing. We have to change this. We have to send out a clear message across both the welfare and pension systems: you will be better off in work than on benefits, and you will be better off in retirement if you save”.
People who are already receiving a state pension will not be affected by the changes.
Labour shadow pensions minister Rachel Reeves said: “Vague promises of jam tomorrow don’t do anything for pensioners today. With higher VAT and fuel prices rising, they want help now”.