Nicolai Haugsted
Retirement plans thrown into doubt as pension age change moves closer.
Millions of Brits could find themselves working longer than expected as the UK government moves closer to accelerating a major change to the state pension age.
Acording to Ladbible, a policy shift outlined by the Treasury suggests the increase to age 68 may arrive years earlier than many had planned for, affecting millions of people currently approaching retirement.
Current legislation states that the state pension age will increase to 68 between 2044 and 2046.
However, according to information provided to the Office for Budget Responsibility (OBR), the government’s current policy is to introduce the change between 2037 and 2039 instead.
The OBR said:
“We assume that the state pension rises to 68 in 2037-39. The Treasury has confirmed to us that this is the government’s current policy position, rather than the legislated increase set in the Pensions Act 2007.”
If implemented, the earlier timetable would affect around five million Britons currently aged between 49 and 55, many of whom expected to qualify for the state pension at 67 rather than 68.
Billions in potential savings
Bringing the increase forward is expected to reduce government spending by roughly £6 billion each year.
The proposal is not entirely new. A government-commissioned review published during Theresa May’s premiership recommended the same timetable, and subsequent administrations have continued to signal support for moving the increase forward, although no formal implementation schedule has yet been announced.
A Treasury spokesperson stressed that the policy has been under consideration for years.
“The previous government publicly committed to raising the state pension age to 68 between 2037 and 2039 and the OBR has reflected that position for years.”
The spokesperson also noted that an ongoing review of the state pension age is still examining the appropriate timetable and that ministers are not yet prepared to announce its conclusions.
Many already leave work before retirement age
The debate comes as research suggests a growing number of Britons stop working before reaching state pension age.
Analysis by the Resolution Foundation found economic inactivity increases sharply throughout people’s 50s and early 60s. By the early 60s, around 40 percent of people are no longer working or actively seeking employment, with that figure approaching 60 percent by age 65.
Currently, around 70 percent of Britons are economically inactive by the time they reach the existing state pension age of 66, highlighting the gap between leaving the workforce and becoming eligible for government pension payments.
