The state pension in Britain will be increased to 68 years of age. This was originally planned to occur from 2044, but it has been announced that the change will be phased in between 2037 and 2039.
What that entails is that those currently aged between 39 and 47 years of age will have to work longer before they receive a state pension. The change will affect those born between April 6th 1970 and April 5th 1978.
The increase in the pension follows recommendations from a report by former CBI director general, John Cridland, who published a report in March of this year. He claimed that at current levels, pension payments would become unsustainable for the British economy.
The report recommended the increase in pension age because the life expectancy in Britain continues to rise. The number of people who will reach the age of 100 in Britain is expected to rise from 6,000 today to 56,000 by 2050.
The move has been condemned by opposition parties and NGOs. Caroline Abrahams, Charity Director of Age UK said: “In bringing forward a rise in State Pension age by seven years, the Government is picking the pockets of everyone in their late 40s and younger, despite there being no objective case in Age UK’s view to support it at this point in time.
"Indeed, it is astonishing that this is being announced the day after new authoritative research suggested that the long term improvement in life expectancy is stalling.
"For people in midlife and younger their State Pension may seem a lifetime away but the fact is that the change announced today will have a real impact on them later in life.”
The Labour Shadow Secretary for Work and Pensions said that “most pensioners will now spend their retirement battling a toxic cocktail of ill-health.” She added, “the government talks about making Britain fairer but their pensions policy, whether it is the injustice that 1950s-born women are facing, or today’s proposals, is anything but fair.”
What is certain is that with rising levels of life expectancy in developed countries, governments will be forced to address the age at which pensions are paid out.
Countries such as Canada have initiated investment plans to ensure that their pension pots are sustainable for future generations.