Experts say the State Pension Age could be set to rise to 70 years old, meaning people will have to work significantly longer before they can retire. Former Chancellor Rachel Reeves said a review into increasing the state pension age was necessary to ensure the system remains "sustainable and affordable".
Government Review Timeline
The Government's review is scheduled to report in March 2029, and it will examine the age at which people can start receiving the state pension as life expectancy continues to increase. The current state pension age is 66, but this is set to increase to 67 by 2028, and the Government is legally obliged to review the age periodically.
There have been calls for Andy Burnham to accelerate the rate at which the state pension age increases in the face of the rising welfare budget. The current plan is an increase to 68 between 2044 and 2046.
Financial Pressures
Samuel Mather-Holgate, an independent financial adviser at Mather and Murray Financial, said: "The state pension system is ripe for squeezing, so an increase to the state pension age is coming down the tracks, probably to 70. Changing the triple lock would save a fortune, but it would be politically difficult as the older generation votes."
The pension system currently accounts for nearly 5% of the UK's GDP, a figure expected to rise to almost 8% within the next half-century. The Office for Budget Responsibility (OBR) has warned that the cost will exceed previous estimates by £10bn annually.
Union Reaction
Unions have warned that any rise in the pension age could trigger strikes.
Eddie Dempsey, the general secretary of the Rail, Maritime and Transport union, stated: "The UK state pension is already one of the worst in the entire developed world, which is a direct result of decades of governments transferring both our national and personal wealth to the super rich."
"Any decision to squeeze more out of working people by forcing us to work even longer would be a national disgrace."
He added: "Our members work in physically demanding, round-the-clock, safety-critical jobs. Many already struggle to reach retirement in good health, especially shift workers.
"Raising the pension age even further isn't just cruel and unnecessary, it's a slap in the face to the very people who keep this country running."
"If this government makes any move to drastically increase the retirement age, we intend to lead our movement onto the streets and will not hesitate to protest nationally and take co-ordinated direct action."
Government Response
A Government spokesperson said: "Supporting pensioners is a top priority, and thanks to our commitment to the triple lock, millions will see their yearly state pension rise by up to £1,900 by the end of this parliament.
"We have also run the biggest-ever campaign to boost pension credit take-up, with nearly 60,000 extra pensioner households being awarded the benefit, worth on average around £4,300 a year.
"But we know there is a real risk that tomorrow's pensioners will be poorer than today's, which is why we are reviving the Pension Commission, to tackle the barriers that stop too many people from saving."
