Debates Continue Amidst The Looming Review Of The State Pension Age
The controversial impact – how different sections of society will be or are being affected
Many are concerned regarding the increase of the State Pension Age (SPA), but some are more concerned about the impact than others. Despite the clear pushback and angst amongst the public, the SPA must rise according to changing life expectancy rates, the ageing population, and the laws in place. This makes the topic inevitably controversial.
One must look at the ‘eligibility to receive state pension benefits’, as a person can only claim these once they reach the SPA. The delay could mean some people may not have enough savings to afford to retire, until the basic state pension is available. Those who are from poorer areas, or have a lower income, are more likely to have to remain in work until they are granted their state pension.
Many will suffer financially if they go ahead with the plan, especially in the cost-of-living crisis climate right now, as well as the fact that many older people are out of work post-pandemic. According to The Guardian, Charity Age UK said any government decision to accelerate the rise in the SPA “will condemn millions to a miserable and impoverished run-up to retirement”.
Many older people have stated that the government is not considering the older generations who will be most affected by the increase. The experience of old age is worsening for many, and the inequalities faced by the older generations are getting more extreme. There is not enough being done to support the ageing population, and increasing the SPA will only make the situation worse. The government should focus on a long-term strategy to support everyone in having a comfortable old age.
Another group of people who are seeing the impact more severely are women. Over the years, women’s SPA has been increased gradually to equal the men’s SPA. Women Against State Pension Inequality (Waspi) have been fighting for this, as many women who were born in the 1950s feel that they are at a disadvantage because of the increase. As women are more likely to stop work or work part-time, due to having children, caring for children, or caring for their elders, and so on, they are less likely to have the right amount of pension savings, and so are more likely to be reliant on state pension. With the longer waiting time to receive the basic SPA, this leaves them at an unfair disadvantage.
In response to the rising SPA, certain job sectors have reacted with anger. For example, members of the UCU (University and College Union) have been striking over pension cuts. Recently there were changes made to the USS (Universities Superannuation Scheme), which has caused ‘increased contributions and reduced benefits’. The goal of the strikes is ‘a secure, valuable and affordable retirement income for university staff’, once again reiterating the idea of a satisfactory old age. This is as a result of the pension cuts in April 2022, which ‘saw them lose an average of 35 percent of their retirement income’.
While this review could majorly affect members of the public in varied ways, the government could benefit from putting back the SPA, as it will increase revenue for The Treasury. The government have been rather quiet regarding this issue, and as the second review is looming, many people are getting more and more agitated.
France has been facing riots after President Macron raised the retirement age, and the UK government have been facing similar challenges. With negative discourse surrounding the issue of bringing the rise of the SPA forward to 2037-39, the government has delayed their decision until after next year’s election, according to the Financial Times. This is mainly due to a ‘fall in life expectancy and concerns that the move could spark a backlash from working-age voters’. The review going ahead could have meant billions of pounds in revenue for the government, but it also would have caused major controversy and unpopularity for the Conservatives at the next election.
REFERENCES:
https://www.theguardian.com/money/2023/jan/25/uk-state-pension-age-rise-68
https://commonslibrary.parliament.uk/research-briefings/cbp-9387/
https://www.ft.com/content/97818be3-a2d9-4e1f-b8a1-c96737a7b8c8
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