Sections

UK not ready to raise state pension age - report

UK – The UK is not ready to raise the state pension age, says the Pensions Policy Institute, but it should be kept as a “live policy issue”.

The PPI has launched a report arguing that while the UK is clearly not ready for a rise in the state pension age at present, the advantages of a rise should not be forgotten and it should not be ruled out as a policy option in the future.

Says the PPI: “It may be the only way to sustain a better state pension in future, and it fits with the potential for longer working lives as we live longer. “

At the moment, the policy is unpopular, but many of the perceived problems could be mitigated as part of wider reforms of state pensions and social security policy. The PPI suggests that if the age were raised then state income supplements would need to be available to support those people with no other income available before the new pension age.

“A better understanding of the likely future patterns of work and income at older ages is therefore needed,” the report says.

Expected changes in work practices such as anti-age discrimination, retraining, more part-time working, should help to make later working lives a reality, and the raising f the state pension age would be more popular if the potential positive impact of such changes could be demonstrated, claims the PPI.

The report underlines that the raising of the state pension age (SPA) is not a stand-alone policy, however, and that “its role must be clear to avoid confusion and misunderstanding”.

Says Alison O’Connell, director of the PPI: “Despite the policy’s current unpopularity, raising SPA could play an important part in making the state pension system better. I hope this paper will lead to a better discussion of the policy intention and its likely consequences. Labour market policy, social security policy and pensions policy must be considered together to determine exactly what role raising SPA could play within an improved state pension system.”

In the UK, the state pension age is currently 65 for men and 60 for women. Between 2010 and 2020, the SPA for women will increase so that by 2020, SPA will be 65 for everyone.

Have your say

You must sign in to make a comment

IPE QUEST

Your first step in manager selection...

IPE Quest is a manager search facility that connects institutional investors and asset managers.

  • QN-2467

    Asset class: Search for a broker (mainly ETFs).
    Asset region: Global.
    Size: 250m.
    Closing date: 2018-08-28.

  • DS-2468

    Closing date: 2018-08-24.

Begin Your Search Here