Figures from the Department of Work and Pensions (DWP) have highlighted the disparities in the amount of state pension people receive per week.
Around 130,000 people get £7 or less a week and the same number get more than £230. This can equate to a difference of more than £10,000 per year.
Confusion over figures and a complex system means people find it increasingly difficult to budget for their needs when they are unsure how much they will receive.
Pensions Minister Steve Webb described the process as "roulette." He said: "The range of state pension payouts at the moment is simply staggering. The current system is so complex and would even baffle Einstein. Worse, if people have no idea what they will get, they can't make sure they have enough savings for 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."

A flat-rate of about £140 is being introduced, as announced n the 2012 Budget and a White Paper will set out further details on this later this year.
Tom McPhail, head of pensions research at Hargreaves Lansdown, said: "The government is right to point out the current system is horrendously complicated. Consequently building any accurate idea of what you might get from the State is nigh on impossible.
"By moving to a simple £140 a week the government can provide everyone with greater certainty over what they will get from the state, allowing them to properly plan what they need from their private retirement savings."