- State Pension age increasing to 68 (current plan by 2028)
- State Pension age increasing to 68 (current plan by 2028) + compulsory pension contribution
- State Pension age increasing to 67 (current plan by 2021)
- State Pension age increasing to 67 (current plan by 2021) + compulsory pension contribution
- State Pension age remaining at 66
- State Pension age remaining at 66 + compulsory pension contribution
- State Pension age returning to 65
- State Pension age returning to 65 + compulsory pension contribution
The State Pension scheme is a mess. Even at the height of 15+% unemployment in the last recession the cost of pensions was higher than Jobseekers payments, which is frightening. It has since grown further.
Govt solution was to increase retirement age for State Pension to 66, 67 (by 2021) and 68 (by 2028).
The 66 change went relatively unprotested, mainly I think as there was a transition payment given to those from 65 to 66. This is now gone.
We go to 67 next year and this became a big political issue during the Election. I actually think all the parties were caught a bit on the hop by how much of an issue it was. There are promises now to not let it go to 68, reviews, etc.
This can has been kicked down the road for years, if not decades. It is clear we cannot keep the status quo. People are living longer. As the solution of don’t pay it til 3 years later (65 to 68) now seems untenable by the electorate, the Govt needs a solution.
Simply saying we’ll keep it at 66 or 67 doesn’t solve the problem of what people live off for those 1 or 2 years.
CSO had a survey lately where 60% of workers had no private pension and of those 60%, 40% plan to live solely off the State Pension. That’s 24% of workers who wish to rely on the State Pension, which they now won’t get for 1-3 years after they retire and we know is unaffordable for the State long term!
Many countries now require mandatory contributions into a private pension, such as Singapore and Australia. We have looked into this option as part of past reviews and one hurdle was an employer contribution, which some businesses may not be able to afford.
IMO mandatory contributions has to be introduced asap. This is a long term game. Setting the bar low at say 4% personal contribution and 1% employer could get the ball rolling.
This, in turn, allows a Govt fudge of keep it at 66 short-medium term.
I’ve a poll created; vote away and interested to hear other solutions.