How will the Pensions Bill affect you?

The House of Lords has been in the news more than usual recently, as the marathon sittings on the Parliamentary Voting and Constituencies Bill attracted coverage and debate. The ritual and procedures of the House of Lords can sometimes look archaic and out-of-touch, but one bill currently in the queue for debate will have very real consequences for many women in the UK.

The Pensions Bill received its first reading a few weeks ago. One of its key proposals is about speeding up the rise in the women’s State Pension Age. Women’s pension age is already rising under current legislation – it is due to equalise with men at 65 and then increase to 66, along with men, between 2024 and 2026. The Directgov State Pension Age calculator can tell you when you’ll reach State Pension Age under the current system.

However, this new Bill proposes that men’s and women’s State Pension Age will now be equalised at 65 in November 2018 and that the pension age for both men and women will then increase to 66 by April 2020.

What does this mean in practice? Around 330,000 women born between December 1953 and October 1954 will see their State Pension Age increased by eighteen months or longer. Those worst affected are the 30,000 or so women born between 6 March and 5 April, who will see their State Pension Age increase by a full two years. These women will be eligible to receive their State Pensions in March 2020 – meaning that a two-year increase will be introduced with less than nine years’ notice if the Bill passes unamended later this year. This makes it more difficult for women to plan for their retirements, particularly as the women affected have already seen their pension age increase from 60 under previous legislation.

At Age UK, we think that there shouldn’t be any increase in the State Pension Age beyond 65 before 2020. We believe it is wrong for the Coalition to cut short the retirements of millions of hardworking people by speeding up equalisation and bringing forward the increase in State Pension Age six years earlier than planned by the previous Government. Fast-tracking the State Pension Age rise will hit the poorest the hardest by shortening the retirements of those living in areas where life expectancy is low. By moving the date forward, the Government has denied the people affected time to plan properly for a delayed retirement.

Are you likely to be affected by the changes in the Pensions Bill? Tell us what you think below.

12 thoughts on “How will the Pensions Bill affect you?”

  1. Unfortunately, being born in April 1954, I am one of the 300,000 women who will have two years added at a stroke to my, already increased, state pension age. I thought I had sorted my pension plans in the most beneficial way, to retire at 64, but if the two years are added, then my plans will go to pot and I will have made the wrong decisions. I don’t understand how increasing the pension age so quickly can be beneficial because all those coming up to retirement who do not have jobs will have to be paid JSA or income Support etc for a longer period. I am not sure of the current rates for these benfits but I think they are more than the state pension.

  2. I was born in 1954 and originally thought I would receive a state pension at age 60, then the government changed it to age 64 and now they want to change it to 66 yet my firends got their’s at 60 – 6 year’s earlier than I will. It makes financial planning impossible and there is no guarantee that the government won’t increase the age further still before I receive my state pension. It creates a sense of insecurity (and anger). Government did not plan properly whereas I did – until they decided to take 2 years of my pension to plug the financial hole they made by incorrect or inadequate planning.. Yes, we all live longer but the government did have all the facilities available to them to work out the statistics and in any case will I really live 6 years longer than a women born only 4 years before me? I have read Steve Webb’s replies to MPs querying how badly women are going to be affected by losing 2 years pension and it implied that he could not give any figures because it depended on the individual. Well, the answer is simple – they will lose up to 2 years’ state pension or up to 9% of their lifetime state pension, depending upon the exact month they were born in 1954 and these figures are taken from the government’s own ‘Impact Assessment’. Some of them may carry on working but prior to the government’s proposals those women could have carried on working and still receive the state pension. Unfortunately some women will be unable to carry on working or find work and they will have to claim benefit, thus negating the savings of not paying them a pension (unless the women will be worse off on benefit, which is sad as pensions are not massive anyway.)

  3. I have worked for the civil service and I know how they work. High paying civil servants do not understand how hard it is for anyone of a low income exist. They are like our bankers they receive high incomes and make decisions that do not really effect them but seem reasonable for them and work for them. I have worked in an environment where our high payed civil servant found it hard to make a decision on what to spend their £6000 bonus on, discussing it with people who are a wage of £15000 a year supporting a family. These people do not understand what it is like to look to the future and plan your finances so that you can just pay their bills. They have no idea that if you are told that you can claim your state pension when you are 63/64 that you plan your life and future around that, and then to be told that it will be 66. Really I cannot understand how they can sleep at night. Maybe it is their £100000 a year and above salaries that buys their comfortable beds that does it for them. I hope someone makes them aware that a lot of people will now be going to bed with hot water bottles in the winter rather than having their heating on because of their decisions. They must be patting themselves on the backs for such a good idea of saving money. My idea would be to cut their bonuses and wages and that would save this amount and more.

  4. Spare a thought for British age pensioner living in some Commonwealth Countries, who having paid the same National Insurance contributions as you and when they get the Pension it is frozen at whatever amount they get. That means no increases ever, every year there is a special meeting of Parliament to pas a bill to deny that years cost of living increase to pensioners living in Canada, South Africa, New Zealand, and Australia, plus a few more smaller countries. That is a good kick in the guts to former residents who have emigrated to join family members abroad, and in doing so save the government about 487 million Pounds a year in savings to National Health alone. We have had promises but no action so far. We live in hope that someone actually carry out the much vaunted British “Fair Play”.

  5. I cannot see how it can be fair to make all women born in 1953/4 bear the brunt of the raised pension age. This is a general unfairness but it applies to me personally (born Dec 1953). I have recently had to take early retirement and have divorced. The settlement is such that I will have to find the extra 18 months’ income from my savings and maybe will also have to cover the loss or reduction in DLA. It is a total joke that this government is in any way protecting its most vulnerable citizens or that it is in any way fair.

  6. This is miserly piece of legislation. Just how much better off is the country going to be by doing this? 300,000 people having there legal entitlement removed at a stroke surely cannot benefit the deficit to that degree. Is this being pursued by Age UK? Are we writing to our MP’s? We should be & maybe we should be lobbying our European courts to challenge this short term-ism that will affect people’s lives so adversely.
    How long before we go back to a work till you drop society (unless of course you’re one of the new *billionaires* – how grotesque that have benefited in recent years).

  7. There is one point to understand, that is the National Insurance fund is a separate entity from general revenue, a totally separate fund containing at the moment some 50 Billion Pounds, Part of the reason I think that all Governments deny this fund exists because they borrow from it. Like I said in a prior post about overseas pensioners, Politicians can look in a mirror and lie to themselves.

  8. Middle aged women have always felt invisible but never more so than on this issue. I feel that this has slipped completely under the public’s radar. I do not disagree with the principle of equalisation of pensions at all but the speed with which this has been introduced for women is outrageous. The government originally planned to start the increase for men from 2016 by one year but considered it too soon to give them time to prepare. However, they have no problem increasing it for women by up to two years!

    The government is overlooking the realities of women of my generation. Some of us didn’t even have equal pay when we started work. Like many women at the time, I left work when my children were born and returned to the workforce part time at a later date. I wasn’t even allowed to join the pension scheme for many years simply because I was part time. I now work part time and have caring responsibilities for both grandchildren and elderly parents. Consequently, I have very little in the way of private pension provision. I cannot simply change my plans at this late stage. It was a shock to discover in the late 90s that I wouldn’t retire at 60 like my friends only four years older than myself and now suddenly it is 66 instead of 64. Women of my age who are aware of this are simply devastated and also furious.

    At a stroke, the women worst affected have lost over £10,000. The government have made much of the fact that their changes are fair and how the poorest in society will not be affected. This change affects all women. It is also completely discriminatory. Men have been given eight years to prepare for an increase of one year. Women have been given seven years to prepare for an increase of two years. There is now a three year difference in pension ages for women born only one year apart. It is an anomaly which owes more to mathematical convenience than fairness.

    The government have shown no inclination to make changes to any of their policies but we must continue fighting this while we can.

  9. Joy Waters’ comments echo mine entirely. I was born in 1954 and having already adjusted to the idea of receiving my state pension at the age of 64, I now discover I have to wait a further 18 months before payment is due. Like many women of my generation I worked for several years before devoting 10 years to raising a family. I returned to work in 1990 and have remained in employment since then. I belong to a generation of women who did not benefit from the generous maternity rights afforded to younger women today, who wish to raise a family and continue with a career.

    I agree that the issue of raising the pension age has to be addressed, but the speed with which this is happening for women born in 1954 is hugely unjustified and in my view will have a long term detrimental effect on family lives. Many couples in their 50s and 60s are facing a time when, along with hoping to enjoy retirement together, they have to juggle responsibilities of caring both for grandchildren and parents. Denied this because of the enforced lengthening of their working lives has a damaging effect on the support network within families, a fact which appears to be totally unrecognised by a government who claim to have the interests of families at heart. One historical factor in men and women having received their pensions at 65 and 60 respectively also appears to have been ignored – on average, statistics show that women marry men older than themselves, thus giving couples a reasonable expectation that they could enjoy most of their retirement together. My husband is 11 years older than me and has already enjoyed 3 years of retirement. With the prospect of my having to work for a further ten years, there now looks to be a thirteen year gap between our retirement ages. How much time we shall have to enjoy our retirement together remains to be seen.
    We are told that our life expectancy is longer than previous generations, hence the need for raising the pension age. But can the Secretary of State for Work and Pensions explain the remarkable anomalies in the calculations and reasoning behind the new proposals. It implies I may expect to live 6 years longer than a colleague currently 60 but only 1 year less than a colleague who is now 40.
    Those women currently aged 60 and over are enjoying much of the benefits of recent pension legislation and those in their 40s and younger have time to prepare for the new changes ahead – but those of us currently in our mid to late 50s appear to belong to a ‘forgotten generation’, having to take the full burden of necessary but unfairly rushed changes for the future.
    I give full backing to Rachel Reeves MP in her Hands Off Our Pensions campaign to fight the current government’s proposals and have signed Barbara Bates’ petition in support of this.

  10. The state pension is paid from the same pot as the civil service pensions. Final Salary schemes, both in the private sector and in the public sector will eventually fail. To many of the senior staff have their final salary boosted with huge pay increases in the final year, and in some cases by bonuses and rolling bonuses into their final year. This increases substantially their final salary and thus pensions. They havent paid enough to warrant these pensions, so in years to come, the pension plans will fail as the lower paid people will in effect be paying for these nose in the trough managers. The government will not universally pay a fixed pension to all pensioners. It will take away benefits, it will means test by another title, it will continue to under report the increases in cost of living, and will shaft the public in the future as in the past. But it will not be increasing the basic state pension. I also believe that the pension, whatever it is, should only be paid to UK citizens who have made the correct contritbutions, not recent immigrants. Perhaps we should look at this as a way of saving pensions.

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