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UK Needs State Pension Age Increase to Balance Books

08 October 2012 (PLANSPONSOREurope.com) –The UK will need to increase its state pension age by around three months a year on top of its existing plans to balance its books, a thinktank will recommend imminently.

Analysis of Office for National Statistics figures by the Centre for Policy Studies published today reveals in 2010/11, households the proportion of tax payers who are net recipients of the state pension – along with other benefits – has risen 10 percentage points, to about 53%, since 2000.

The group announced research at the conference of the UK’s Conservative Party conference – the largest in its coalition government – and attributes part of this to changes in effective tax rates and to changing demographics.

Knox told PLANSPONSOR Europe the thinktank will publish firm recommendations by the end of 2012, claiming existing plans by the UK government to increase the state pension age to 66 in October 2020 do not go far enough and the figure needs to be sped up to the tune of three extra months per year, the fastest he believes is politically palatable.

“It is a small step in the right direction. We need to go much further and much faster,” he said. It needs to be explained to people very clearly.

“We can’t really increase [the state pension] at more than three months a year. That would be the fastest rate we could increase it.

“There is also the political judgement. In terms of taking the public with us - this is not going to be a popular policy.”

 

PLANSPONSOREurope Staff
editors@plansponsoreurope.com





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