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Budget 12: State pension to be linked to life expectancy

Chancellor George Osborne has confirmed future increases in the state pension age will be linked to life expectancy.

Speaking to Parliament today as part of the Budget, Osborne (pictured) said details of how the “automatic review” system will work will be published in the summer.

He said: “I’ve also said that we would consider proposals to manage future increases in the state pension age, beyond the increases already announced.

“I can confirm today that there will be an automatic review of the state pension age to ensure it keeps pace with increases in longevity.

“Details of how this will operate will be published alongside the OBR’s long term fiscal sustainability report this summer.”

Osborne also told MPs that if Government departments continued spending at current rates the welfare bill will have to be cut by £10bn by 2016.

Plans to introduce a link between the state pension age and longevity were first outlined in a Department for Work and Pensions green paper published in April 2011. The move could mean younger people will not receive a state pension until their mid-70s.

The green paper also set out proposals to introduce a flat rate state pension worth £140 a week.

For Money Marketing’s full coverage of the Budget click here.

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Comments

There are 6 comments at the moment, we would love to hear your opinion too.

  1. While the link between longevity and cost of provision is obvious, the link between retirement and requiring a pension is not. The welfare state now assumes as we live longer we are healthy enough to work later in life.

  2. Medical science is keeping old tired bodies alive so good old George says send them to work. lmao

  3. Both parts of this coalition are as useless as the last lot.

  4. If an aim of government is to get the youth of today employed, why has no one thought that keeping us ‘oldies’ working ever longer denies that youth a job. That young unemployed may have a family to support and is thus claiming more in benefits than the ‘oldie’ will get in the OAP. Mad world innit. Confused !!

  5. Bet he won’t be working till mid 70s. He will enjoy his special pension

  6. I agree with the above. If we all work longer,and it is a huge assumption that we all can, health varies from one person to another, it will certainly keep the younger generation out of work. I have never known such short sighted policies and sadly daft policies. This is yet again a process of short term thinking with short term fixes. I am 54yrs and work full time, however, I am finding that I get so tired, what hope is there for me in my 70’s, like to see Mr Osborne and crew struggle on wth a low income and very little savings and long hours!

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