Faced with criticism from every quarter and extensive lobbying from pensions campaigners and women’s groups, Ministers have now agreed to delay the second rise in the pension age from the April to the October of 2020.
Work and Pensions Secretary Iain Duncan Smith agreeing that the existing plans were “on balance, unfair”, adding that the new 18-month cap “will free up a lot of women, I hope, from their concerns and worries.”
Echoing his comments, Lib Dem Pensions Minister Steve Webb said that the Government has “delivered on its promise “ to consider the impact of the pension changes on those “most adversely affected.”
Joanne Segars, Chief Executive of the National Association of Pension Funds (NAPF), said: "This takes some of the sting out of what was a very raw deal for many women. People need time to prepare their finances for the transition into retirement, and there is now a clearer ceiling on what to expect.”
It has been calculated that this move will cost the Government around £1bn. And it will spend £45bn extra on pensioners by 2025 because of the triple guarantee to uprate the basic state pension by the highest of earnings, prices or 2.5 per cent.
When the state pension age was set at 65 in1926 there were nine people of working age for every pensioner. There are now three people of working age for every pensioner and that is set to fall to nearer two by the end of this century.
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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