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Home General News Featured

UK raises retirement age to 68

Attah Dabone by Attah Dabone
July 19, 2017
in Featured, International News
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Millions of workers will have to work an extra year before retiring after the Government announced plans to extend the retirement age to 68.

The state pension age had been due to rise by a year – from the current age of 67 – in 2044.

But David Gauke, the Work and Pensions Secretary, said the cash-saving move would be implemented from 2037, seven years earlier than planned.

It will leave anyone aged 47 or younger having to work for an extra 12 months before they can claim their state pension.

Debbie Abrahams, the Shadow Work and Pensions Secretary, called the announcement “an astonishing continuation of austerity”.

She said 34 million people would have to work longer than under Labour’s plans.

The change, which will be brought in over two years, will affect everyone born between 6 April 1970 and 5 April 1978, who under current legislation had been due to retire at 67 but will now work a year longer.

No one born on or before 5 April 1970 will see a change to their current state pension age.

There is also no change for those born after 6 April 1978, whose state pension age was already due to rise to 68.

The new timetable, which it is claimed will save £74bn by 2046/47, is intended to “maintain fairness between generations in line with continuing increases in life expectancy”, the Department for Work and Pensions (DWP) said.

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Mr Gauke, who revealed the change in a statement to the Commons on Wednesday lunchtime, said: “As life expectancy continues to rise and the number of people in receipt of State Pension increases, we need to ensure that we have a fair and sustainable system that is reflective of modern life and protected for future generations.

“Combined with our pension reforms that are helping more people than ever save into a private pension and reducing pensioner poverty to a near record low, these changes will give people the certainty they need to plan ahead for retirement.”

Responding to the announcement, Labour’s Ms Abrahams said: “We cannot allow this Government to push people to work longer and longer to pay for its failed austerity agenda.

“That’s why Labour will leave the state pension age at 66, while we look again at the emerging evidence, with a view to guaranteeing a secure and healthy retirement for the many, not just the few.”

Plans to extend the retirement age follow a review carried out by John Cridland, published in March, which proposed bringing forward the increase.

The DWP cited calculations contained in the review which found that under the previous timetable, by 2036/37 annual spending on the state pension would have increased by 1 per cent of GDP on 2016/17, equivalent to £20bn in today’s terms.

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Steven Cameron, pensions director at Aegon, said the timing of the announcement was “ironic…days after statistics show improvements in life expectancy may be levelling off”.

He said the increase “may be less justified on affordability grounds” and called a blanket increase in the state pension age “particularly concerning for those who through health concerns, job pressures or lack of employment opportunity”.

Source : www.independent.co.uk

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