State pension age could rise earlier - Pensions - News - Moneyfacts

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State pension age could rise earlier

State pension age could rise earlier

Category: Pensions

Updated: 22/11/2011
First Published: 12/09/2011

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The Government is considering bringing forward the date that the state pension age will rise to 67, it has been revealed.

Over the weekend, the Pensions Minister, Steve Webb, and the Secretary of State for Work and Pensions, Iain Duncan Smith, both discussed bringing forward the increase in state pension age to 67, perhaps by 2026.

Both voiced the opinion that the current timetable of change is too slow - at the moment, the age is due to rise to 67 in 2036 and 68 by 2046.

While a final decision on the new suggestion has yet to be taken, the ministers have made it clear that they would like to push the proposals through.

With people living longer than ever, and public finances already stretched to their limit, the Government says the drastic action is necessary to cut the amount it has to pay out in pensions.

This latest review of the situation has been seen by Dr. Ros Altmann, Director-General of Saga, as a chance for the Government to undo what she has called the 'betrayal of millions of older women'.

Under existing proposals, the state retirement age of women is set to gradually be brought in line with that of men.

However, with the current plans also set to see the state pension age to rise to 66 in 2020, Dr Altmann says some women, in particular those who are already aged 57 or 58, are being left with little time in which to alter their plans for retirement.

She believes the Government could still save over £30 billion, but also give people fairer notice about when they can retire, by amending the timetable so that the pension age is changed to 66 in 2022, and then followed by a rise to 67 in the following few years.

"The Government has a chance to rethink current unfair plans and have a better timetable," she added. "Bringing forward the increase to 67 by 2026 will however allow the Government to undo its terribly unfair plans that were hastily announced in the Pensions Bill.

"Having promised in the Coalition Agreement that it would not increase state pension age beyond age 65 before 2020, it went back on that promise and announced increases for some women in their late fifties and they have not had enough time to prepare.

"They have written to me in despair as to how they can manage at such short notice to prepare for a two year delay in their pension, having already accepted a four year rise in the 1995 changes."

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