PwC: UK needs pension age of 70 and £20bn in cuts
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A further £20bn austerity package and an increase in the pension age to 70 is necessary to reduce public debt, according to a report from PricewaterhouseCoopers.
PwC has calculated that to bring down public debt to its pre-financial crisis level of below 40 per cent of GDP by 2050, would mean fiscal tightening of around 1.3 of GDP by 2020, the Daily Telegraph reports.
PwC says this would mean a further £20bn in austerity measures and a retirement age of 70.
If the additional £20bn was to be raised through taxes alone, it would be the equivalent of a rise in VAT from 20 per cent to 24 per cent, or a two percentage point rise in employer and employee national contribution rates.
The Government is planning to increase the state pension age for women from 60 to 65, the same age as for men currently, by 2018. The pension age for both men and women will then rise to 66 by 2020.
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Readers' comments (1)
Anonymous | 6 Jul 2011 2:29 pm
I was born in November 1953 and won't now get my pension until I'm 63 years and 7 months old. I'm self employed with a couple of chronic illnesses so have made sure I had waiver of premiums on my pension policies and permanent health insurance (not cheap and with waiting periods of either 6 or 12 months). Unfortunately these all expire at 60, the state pension age when I took them out. Are the companies concerned likely to offer extended cover on the same terms without further medicals? Can pigs fly?
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