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TUC: Govt should ditch state pension age rise plans

Pearson-Jeremy-Canada Life-2013-blog

The Trades Union Congress says the Government should ditch plans to link state pension age increases to average life expectancy after research exposed huge disparities in different parts of the UK.

The Department for Work and Pensions has proposed introducing a five-yearly review of the state pension age in the next Parliament, which begins in 2015.

This review will be informed by analysis from the Government Actuary’s Department, which will consider the proportion of adult life people in the future can expect to receive the state pension. 

In addition, an independently-led body will consider wider factors that should be taken into account when increasing the state pension age, including variances in life expectancy.

The TUC has today published research setting out the impact geographical area has on average life expectancy.

It suggests a woman in her late 40s from East Dorset can expect to receive £67,000 more in state pension when she retires than a woman of the same age living in Corby.

The TUC says this is because, on average, women in East Dorset live nine years longer than women in Corby.

The report goes on to say people living in other “poor” areas, such as Manchester, Salford and Hull, will lose out when the state pension age rises.

TUC general secretary Frances O’Grady says: “There is already a shocking divide in life expectancies across England, and if current trends continue that inequality will get worse in the coming decades. The Government’s pension reforms will add to the problem, with people in richer areas receiving more from the state, while those in poorer areas receive less.

“It cannot be right that people living in a wealthy area can receive tens of thousands of pounds more in state pension than someone living in a less well off part of the country, particularly as richer people are likely to have earned more during the career and have a bigger private pension too.

“The Government should abandon its plan to raise the state pension age in light of the new evidence on projected life expectancies. It should instead set up an independent commission to examine health inequalities and the impact on people’s expected retirement incomes.”

A DWP spokeswoman says: “Life expectancy is rising across the whole of the UK and we need a sustainable state pension system. Future rises in the state pension age will be independently reviewed taking in a range of relevant factors. 

“These are expected to include variations in healthy life expectancy, between different socio-economic groups, regional variations, and wider economic considerations.”

Life expectancy by local area and occupation
Life expectancy at 65 by local area (years)      
  2011 2016 2028
East Dorset (male) 20.9 21.8 24
Manchester (male) 15.4 15.9 16.9
Gap 5.5 5.9 7.1
East Dorset (female) 23.7 25 28.1
Corby (female) 18.6 18.8 19.1
Gap 5.1 6.2 9
Life expectancy at 65 by occupation (years)      
  2006 2016 2028
Routine and manual (male) 15.8 17.4 19.3
Managerial and professional (male) 18.4 20.2 22.4
Gap 2.6 2.8 3.1
Routine and manual (female) 18.9 19.8 20.8
Managerial and professional (female) 21.3 22.8 24.6
Gap 2.4 3 3.8


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There are 4 comments at the moment, we would love to hear your opinion too.

  1. The whole idea of pensions is that the long lived get more over their lifetime than the short lived. What do the TUC think pensions are for?

    Early retirement due to ill health is a separate issue, as is age-related unemployment

  2. This is just another government con to avoid paying out what people paid in to. We will all be working till we drop at this rate.

    It isn’t about how long you live, it is about the quality of life.

    People should be able to retire and enjoy some quality time before they die. In current times people do not have much spare cash to save for the future and if they could they certainly wouldn’t choose a pension after all the negative publicity, selling scandals, colapses associated with them over the last 20 years.

  3. Could it be healthier people in Corby move away when they retire, whereas people in Dorset stay where they are?
    The statistics aren’t useful without details of where someone was born, lived and worked AND retired.
    It’s like saying becuase they produce really good Cider in Devon, Dorset and Somerset that it must be the reason for the longevity!

  4. @ Anonymous | 30 Aug 2013 1:03 pm
    The unregulated collapses are worse than the regulated.
    As I say to clients, all a pension, bond and ISA are are tax wrappers. Most can hold pretty much the same investments within them. the failure is in knowing what is in the tax wrapper and choosing an adviser who doesn’t identify what their client wants and/or needs.
    It’s very much like having a party pack of crisps. The outer bag is just the tax wrapper i.e. pension/isa/bond, it is the flavour of the packaging on the inside and then the flavour of the product that needs more care than the outer wrapping.

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