Interactive investor welcomes reports that the decision on the state pension age rise to 68 has been delayed. It’s believed that a decision will now be made in 2026. It was previously reported the Government was considering plans to raise the state pension age to 68 as early as 2034.
Alice Guy, Head of Pensions and Savings at interactive investors says: “Today’s reported decision to shelve plans to raise the state pension age more quickly comes after sad news that life expectancies are currently falling rather than rising. The state pension age is closely linked to life expectancies. The regular report into the state pension age is due out any time soon and its recommendations are based on us spending an average of one-third of our lives in retirement.
“It’s a sad fact that life expectancies are falling as Britain for a whole host of reasons and it’s difficult for the government to justify pushing raising the state pension age more quickly.
“Not only are life expectancies slightly falling, reducing 7 weeks for men between 2017 to 2020 (ONS figures), they also vary widely around the country with life expectancies 3 years lower in the North East compared with the South East (ONS figures) and are also often linked to income level. It’s also a sad reality that those with chronic health conditions often live for less time in retirement.
“We also know that many adults enter their 60s with at least one health condition and the average healthy life expectancy much lower than the state pension age: 62.8, according to ONS figures. According to interactive investor’s 2022 Great British Retirement survey, more than one in five (21%) of 56-to-65-year-olds cut their hours because of ill health.
“It’s also almost impossible to work into your 60s in some professions. If you’re a builder or carpenter in your early sixties and you injure your back then it’s game over.
“It’s important to remember that this decision only kicks the can down the road. The state pension age is still rising to 67 in between 2026 to 2028 and 68 between 2044 to 2046. Today’s reported announcement only delays the decision on whether to raise the state pension age to 68 earlier than 2046.”