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Turner rues not being radical on retirement

FSA chairman Lord Turner says raising the retirement age to 70 by 2030 would reduce the need for means-testing by enabling the state pension to be fully equivalent to the minimum income guarantee.

Speaking to the BBC, Turner said he believed that the state pension age should be raised more quickly and admitted he would be more radical in his report on pensions if he were rewriting it today.

The pension age is currently set to rise to 66 in 2024, 67 in 2034 and 68 in 2044. Turner also said that public sector workers should be moved out of final-salary schemes and into more flexible pensions.

He said: “There were proposals around at the time that you might take the state pension age to, say, 70 by as early as 2030. If you did that, you could afford to simply have a state pension which would be fully equal to the minimum income guarantee. Having seen what I have seen, I would probably say, if anything, we should have been more radical.”

Pension consultant Ros Altmann says she welcomes Turner’s admission that the Pensions Commission recommendations should have been more radical. “We have wasted four years now in rearranging the deck-chairs on the Titanic of a system that is not sustainable rather than rebuilding the ship to make it seaworthy. The sooner we start properly, the better.”

Standard Life head of pensions policy John Lawson says: “Lord Turner is effectively saying he got it wrong when the Pensions Commission made its recommendations in late 2005. With three years still to go before auto-enrolment comes in, there is still time for a policy U-turn.”

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  1. Turner & Radical Proposals
    Hmmm! Maybe not radical enough for Turner to propose; Turner who has no doubt secured a decent FS pension pot which allows him to retire whenever he wishes (>55). Will he consider the working wo/man who would like to retire and enjoy a minimal state pesnion at the age of 65/6/7/8 until they finally expire? Clearly the state pension has no impact on Turner’s income but for a lot of people it does and will. Never mind Tesco ‘shop til we drop’ with Turner it’s ‘work till you drop…’

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