In an announcement back in 2017 by then Secretary of State for Work and Pensions, David Gauke, he stated that the planned increase in State pension age from 67 to 68 which was due to take place starting in 2044[1]The Mirror: State pension age to rise to 68 as DWP to increase retirement age SEVEN years earlier could possibly be brought forward seven years to 2037.
The government have announced that they are going ahead with the changes which will affect those currently aged between 39 and 47.
The amendment was suggested by an independent review which was conducted by former CBI chairman John Cridland.
The change appears to be due to the increase of people who will be claiming state pensions, while the number of people contributing to them will decrease in the coming years. This is mainly due to an increasingly aging population who are drawing pensions rather than paying into them – statistical trends show that there will be an additional 7.5 million people over the age of 65 in 50 years time [2]ONS: Overview of UK Population (2021)
The state pension age was originally set at 65 for men and 60 for women[3]Full Fact: Increasing the state pension age but the age for women was brought into line with men in 2011.
A law was enacted in 2007 which provisioned the increase to 66 – 68 between 2024 and 2046. In 2011 the government fast tracked the time table so that state pension ages would equalise by 2018 and rise to 66 for everyone by 2020.
A further amendment raised the age to 67 which would come into effect from 2034 but The Pensions Act 2014 brought the increase in the State Pension age from 66 to 67 forward by 8 years[4]Gov.UK: State Pension age timetable and the rise in age was discussed several years ago but nothing was done at the time[5]Sky News: State pension age increase from 67 to 68 brought forward.
According to some sources, the increase in the pension age to 68 will save an estimated £74 billion pounds a year by 2045 but it will affect around 34 million people who will now be expected to work longer that they previously assumed.
It’s important to note that if you’re born on or before the 5th of April 1970 you won’t see the increase in pension age and it will remain at 66 or 67 depending on your date of birth.
Katy is the editor-in-chief of FlippingHeck.com a blog about Self-Improvement, Productivity and Small Business Tips. When she’s not working, she enjoys gaming, making music and Reviewing Things.
Additional Sources:
- BBC News: State Pension Age Rise Brought Forward[6]BBC News: State Pension Age Rise Brought Forward
- Age Concern: Changes to state pension age[7]Age Concern: Changes to state pension age
