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Women win reprieve as state pension rise delayed

Women win reprieve as state pension rise delayed

Category: Pensions

Updated: 22/11/2011
First Published: 14/10/2011

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 It is now over 6 months old so the content may be out of date.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 has decided to delay raising the state pension age to 66 by six months after backtracking on original plans that would have seen thousands of women have to wait an extra two years for their pension.

While the state pension age for women will still rise from 60 to 65 by 2018, plans to then increase the age for both men and women to 66 from April 2020 have now been pushed back to October 2020.

Under the original proposals, around a quarter of a million women in their late 50s would have had to wait two years longer than they originally anticipated to get their pensions.

Following the shift in the timetable, however, the wait will now be capped at 18 months.

"Under the Government's original plans this group would have had little time to adjust their retirement plans to compensate for waiting up to two years longer for their state pension," said Richard Eagling, editor of Investment Life & Pensions Moneyfacts.

"Numerous research has shown that women over 50 are particularly vulnerable to retirement poverty as they have been unable to make adequate private pension provision for themselves.

"The state pension provides them with a lifeline, so any delay to its payment will be felt hard."

Drastic action has had to be taken in raising the state retirement age because of dramatic increases in life expectancy.

The fact that Government coffers are also far from flooding also made the move necessary.

It is estimated around £30 billion will be saved in the next Parliament by raising the state pension age and making it the same for both men and women.

The six month delay is expected to cost around £1 billion.

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