Plans to make major change to state pension could be delayed – here’s how it will affect you
PLANS to raise the pension age to 68 could be pushed back – amid falling life expectancy in the UK.
The current age which people can claim a state pension – which is 66 – is due to rise to 67 by the end of 2028.
An official review is due to look again at the pension ages by May.
But now the major decision could now be kicked into the long grass until after the election.
A government source told the FT: “They were gung-ho to raise the pension age. But they got cold feet.”
The Sun revealed earlier this year that ministers were locked in discussions about bringing the rise to 68 forward – currently it’s pencilled in for 2044.
Some ministers were pushing to bring it forward to as early as 2033.
A previous review recommended bring it to between 2037 and 2039 as people were living for longer, and therefore needed to work for longer to put extra cash into their pots.
The state pension bill is set to balloon from £110billion this year to £150billion within the next five years alone, the Office for Budget Responsibility have warned.
But the DWP were resistant to raising the age again – as life expectancy has plateaued in recent years.
It could mean some people dying before they are able to access their hard-earned pots.
Around 7 million people born in the 1970s and later would have been told they have to work for longer – but now the plans may be put on ice for a while longer while more data is collected.
Sir Steve Webb, a former pensions minister, said: “The improvement in life expectancy at retirement that was predicted at the time of the last [pension age] review, basically didn’t happen. Life expectancy at retirement now is two years shorter than it was when they did the last review.”
Catherine Foot, Director of Phoenix Insights, the longevity think tank, said: “Many people on low incomes in the UK fall out of work because of ill health and disability years, and in a significant number of cases, decades before reaching state pension age.
“Today’s reports reflect the fact that it is not the right time to accelerate the increase given our recent declines in life expectancy and where we are in the political cycle.”
Any move to bring the age forward in law would likely spark anger amongst Brits in their 40s and 50s who would be told to work for longer.
It comes after President Macron in France faced a huge backlash at raising the pension age there from 62 to 64 – with violent protests and clashes.
He had to force it through under special powers without a vote.
Most read in The Sun
Jeremy Hunt recently raised the cap on pensions allowances for the wealthy in last week’s budget in an attempt to try and encourage people to stay in work for longer.
A Department for Work and Pensions spokesperson said: “The government is required by law to regularly review the state pension age and the next review will be published by 7 May.”