Hope for a rethink on pension age changes
Hope for a rethink on pension age changes
by Dr. Ros Altmann
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The Government’s proposals for increasing State Pension Age have attracted huge protest, anger and despair. Many of you have asked for my help and I have been inundated with letters and emails from people who say they cannot cope with a sudden two year rise in pension age in only a few years’ time. Thousands of you have supported our petition. I have relayed those concerns to Ministers and the media has also highlighted this problem.
At last, there may be a sign of a change of heart by the Government over its plans. We can’t get too excited just yet and it is important to keep up pressure on MPs if you want the proposals changed, but press comments over the weekend suggest they are working on a compromise solution that will be far fairer, cost no more money, and be a better solution for the longer-term sustainability of our pension system.
Any such proposals could be announced when the Pensions Bill is debated in the Commons in the coming weeks. If so, it could mean that 2.3million men and 2.6million women currently in their late fifties, will not have their pension age changed as was originally planned. Men and women’s pension age is already set to be equalised at age 65 in 2020 and the Coalition Agreement promised that no more changes would be made before that. If the Government sticks to its Agreement, and then increases the state pension age to 66 in April 2021, it will have given people ten years’ notice of their pension age change so they have more time to plan their retirement. Pension planning is, after all, a long-term business so people need sufficient time to adjust to big changes.
It looks like the Government may be considering moving to age 66 in 2021 and then towards age 66½ in the following years. This would achieve the aims of increasing the state pension age (which is clearly necessary) and saving money on state pensions in future (which is also important for a sustainable pension system), as well as being fairer to people by not making sudden changes too close to their promised pension age.
Our petition has attracted support from thousands of people and thanks to all of you who have signed up. It would be fantastic if the Government showed it has listened to people’s legitimate concerns and found a better way of saving money than its original plans.
Isn’t that what we would want from a Government? To listen and adjust if needed, rather than ploughing on regardless and ignoring important concerns.
It is too early to know whether change really will happen, but there are promising signs and we are hopeful that a good compromise will be announced. I will keep you posted!