The House of Lords is sometimes seen as old-fashioned and anachronistic, but last week it debated an issue affecting nearly five million people. The Pensions Bill, which has just received its Second Reading in the Lords, does two things relating to the State Pension Age. Firstly, it speeds up the equalisation between men’s and women’s state pension ages at 65. Secondly, it brings forward the date when the State Pension Age would start to rise from 65 to 66, from 2024 under current legislation, to 2018.
We understand that there’s a need to increase the State Pension Age as people live longer on average. But these proposals will force millions to delay their retirement and also give them barely any time to make the necessary financial provisions. 330,000 women will see their State Pension Age rise by 18 months, and the 30,000 unlucky enough to be born between 6 March and 5 April 1954 will have to wait a full two years extra before receiving their state pensions – with less than ten years’ notice.
Many of the women affected by these changes will have spent most of their working lives expecting to receive their state pensions at 60 and will have planned accordingly. They have already seen their state pension age rise once, but with the countdown to retirement already underway, they face the prospect of further delays. Most people would agree that the state pension age should be the same for men and women, but the speed of adjustment under the new proposals is just too quick. The Government should also recognise that women face greater barriers in building up both state and private pensions, for reasons such as time spent caring and lower earnings during their working lives.
The average weekly state pension paid to women is around £93 a week compared to £124 a week for men.
At present, around seven in ten women aged 55-59 and four in ten women between 60 and 64 are working. The majority of women in their fifties who aren’t in employment at the moment are sick, disabled or unable to find work. These women particularly will find the Government’s plans a huge shock – many will find themselves facing years more with no job prospects, no pension and an increasing reliance on meagre state benefits.
By pushing ahead with these plans, the government is breaking the promise it made in the coalition agreement not to start increasing the state pension age to 66 for women before 2020. We don’t believe that rushing through these changes is the best way to take account of increased life expectancy. People ought to be able to plan properly for retirement. Any changes to the state pension age must be part of a more coherent government strategy to narrow health inequalities, provide better support for older workers, and end pensioner poverty once and for all.
You can get involved with Age UK’s State Pension Age campaign via our website.