Save, make, understand money


Govt will have to justify planned increase to state pension age

Joanna Faith
Written By:
Joanna Faith

The government will have to justify proposed changes to raise the state pension age, which could see millennials working until they are 70.

A petition by trade union Prospect has secured 12,000 signatures. When a petition gets 100,000 signatures, it must be debated in Parliament.

The petition called “Reverse government decision that will increase State Pension Age for millions” was launched after the government said it would raise the state pension age to 68 by 2039, a full seven years earlier than planned.

The government put the decision down to increased life expectancy but charities and unions said the proposed changes were unfair to middle-aged and young workers.

Legislation means that the secretary of state is expected to formally review the state pension age on a regular basis.

Prospect general secretary, Mike Clancy, said: “I’m delighted the petition has been so strongly supported by Prospect representatives and members.

“It is very important that government is forced to explain why it believes future generations should expect to spend a lower proportion of their adult lives in retirement. In doing so they have ignored their own independent reviewer who recommended that 32.87% was an appropriate proportion to use. We need an open and honest debate about the impact of this proposal before any changes are implemented.”

Steven Cameron, pensions director at Aegon, said: “The main justification for increasing the state pension age is to make it affordable as average life expectancy increases. The timing of the planned increase to age 68 is based on Government Actuary life expectancy projections with the government deciding on what proportion of predicted adult life should be spent receiving a state pension.

“It’s very difficult to predict future improvements in life expectancy and it’s right that the analysis should be revisited as we gather statistics on actual experience and likely future trends. Equally, it’s important to give people lengthy notice of any increases so they can plan ahead and make the necessary private provision.”