93.Sections 16 to 18 provide for arrangements to defer the payment of a new state pension.
94.Under the old retirement pension rules, individuals can choose not to claim their pension at pensionable age or to give up their pension for a period of time after they have started to receive it. As a consequence, they will qualify for either an increase to their weekly pension (known as increments) or for a lump-sum payment from the point they claim (subject to some conditions). This is known as deferral.
95.The basic principle of deferral is being retained for the new state pension, but only the ability to accrue a weekly increase. Those who reach pensionable age on or after the start date of the new state pension will not be able to accrue a lump-sum. The accrual rate of the weekly increase will be set out in regulations (see section 17(4)). Regulations may modify the amount of the increment in relation to overseas residents who are deferring their pension (see section 18(3)). There will be no inheritance of a weekly increase accrued by the deferral of a new state pension.