Major changes to the state pension rules are taking effect now
Major changes to the state pension qualifying rules are on the books and could happen sooner than expected. But experts that changes to the DWP rules risk devastating the country’s most vulnerable.
The Government is increasing the age when you can claim your state pension, with another increase also legislated for. But Catherine Foot, director of the Standard Life Centre for the Future of Retirement, fears these changes could have a dire impact on some people forced to wait longer to claim their payments. Ms Foot said: “The UK’s demographics are gradually changing, and in the long term the proportion of the population above the state pension age is expected to increase.
“However, we also know that 15 million people are already not on track to save enough during their working lives for a comfortable retirement. Further rises in the state pension age would be likely to deepen inequality, given we know that about a quarter of all 60 to 65 year olds already live in poverty.”
A widening divide
She warned that while policymakers may see increasing the state pension age as necessary given the ageing population, it could also “widen Britain’s socio-economic divide”. The state pension age is currently transitioning from 66 to 67, between April 2026 and April 2028.
Proposals are on the books for another increase to 67 to 68, between 2044 and 2046. There have been suggestions of bringing forward this move to 68. The OBR was the latest to advocate such a change, saying recently the move to 68 should happen between 2037 and 2039.
‘Not achievable for everyone’
But Ms Foot warns that where to set the state pension age is a tricky question. She said: “Ultimately there is no ‘correct’ state pension age, but as a framework for its basis is considered it’s crucial that any changes do not risk deepening inequality and hardship for those least able to work for longer.
“Decisions should be based on a balanced assessment of life expectancy, affordability and fairness considering that, even at the current age of 66, working until state pension age is not easy or achievable for everyone.”
Labour confirmed plans in 2025 for another review of the state pension age. The law states the Government must provide an update on the state pension age at least every six years.
The Government has commissioned Dr Suzy Morrissey to produce an independent report with her own recommendations, which ministers will then look at.
