UK state pension age review launched amid rising demographic pressures

Dr Suzy Morrissey today announced she has been appointed by the Department for Work and Pensions (DWP) Secretary of State to prepare the expected independent report for the government to consider ahead of the third review of State Pension age with a view to making recommendations for future State Pension age arrangements, in light of the long-term demographic pressures the country faces. 

The report will look at key factors the Government should consider in determining State Pension age for future decades. This includes the merits of linking State Pension age to life expectancy, the role of State Pension age in managing the long-term sustainability of the State Pension, and the international experience of Automatic Adjustment Mechanisms for making decisions about State Pension age.

The current legislated timetable is for State Pension age to rise to 67 between 2026 and 2028 and 68 between 2044 and 2046 and a review is undertaken every 6 years.

David Pye, a client consulting director at leading independent financial services consultancy Broadstone, commented: “The launch of the State Pension Age Review is a critical step in laying out the long-term future of this hugely important core benefit for retirees to aid their individual planning and cashflow modelling that many now undertake.

With an ageing population, previous governments have almost exclusively used an increasing State Pension age to control costs – especially at a time of creaking public finances. But it will be interesting to see if the final Report recommends anything different especially as life expectancy plateaus and our health landscape changes.

If the State Pension age is increased or the amount provided is reduced or means-tested, it will only re-iterate the need for urgent reform in the private savings landscape to ensure adequate incomes at retirement.”