Legal & General has accused the Government of ageism after ministers tabled concessions to public sector pension reforms that protect everyone over the age of 50.
Last week, Treasury chief secretary Danny Alexander tabled two significant concessions in discussions with public sector unions as policymakers try to avert planned strike action on November 30.
In a statement to the House of Commons, Alexander outlined plans to increase the cost ceiling for Government spending on public pensions and introduce “transitional arrangements” so no one within 10 years of retirement will see any change in when they retire or any decrease in the amount of pension they receive.
He said: “I believe this package is affordable. I believe it is also fair, not just to public sector workers, but delivers significant long-term savings to taxpayers who will continue to make a significant contribution to their pensions.”
L&G pensions strategy director Adrian Boulding says: “This concession may be found to be ageist. The Government is saying that if you are an older person you will not be any worse off under the reforms, but if you are young you could be.
“People who are close to retirement have already benefited the most from the previous, more generous system. It does not seem to me to be fair to single out older workers for protection without offering the same protection to younger workers.”
But Hargreaves Lansdown head of pensions research Tom McPhail says: “I do not think the concession is ageist. These kind of reforms will inevitably result in discrepancies but I think younger employees are more likely to be resigned to such changes.”
A Treasury spokesman says: “It is right that those closest to retirement, whose plans are farthest advanced and have least time to adjust, should receive this protection.”