The Government is preparing to shelve a planned rise in the state pension age, as a decline in life expectancy leaves ministers struggling to justify the change, according to newspaper reports.
Chancellor Jeremy Hunt is preparing to delay a decision on when to increase the state pension age to 68 from the current 66, according to reports in the FT and Daily Telegraph.
The state pension age will rise to 67 between 2026 and 2028 and is scheduled to rise to 68 by the mid-2040s, but Hunt had been hoping to bring this forward, as recommended by an independent review in 2017.
But Whitehall insiders, quoted by the papers, said there was an “emerging consensus” among the key cabinet ministers that the decision should be postponed until after the next election.
Pushing a decision to the other side of the general election, which is widely expected in 2024, could have political benefits for the Tories as they seek to overturn a major poll deficit.
Older workers in their 50s are a core bloc of traditional Conservative voters that the party cannot afford to alienate.
France: "We are increasing the retirement age by two years"
The French: "We will drop kick the eiffel tower into the f*cking moon if you do"
Britain: "We've made it easier for old rich people to stay rich and if you're poor you can never retire"
Brits: "oh crumbs oh bother"
— TechnicallyRon (@TechnicallyRon) March 17, 2023
Steve Webb, former pensions minister and partner at LCP, said: “In many ways, people in their 50s are probably your swing voters. Upsetting people in their 50s is probably not what you want to do just 18 months before an election, especially if you don’t get any money until the 2030s.”
Bringing forward the increase could also trigger a rebellion amongst Tory MPs, Webb suggested.
Eight years ago, John Cridland advised the government to raise the state retirement age to 68 between 2037 and 2039. He suggested increases should be linked to rising life expectancy, helping to justify the rise.
However since then, British life expectancy has unexpectedly dropped. It was lower in 2021 than in 2011, according to the Office for Health Improvement and Disparities.
It is understood that the final decision on the Government’s approach to the state pension age has not been made, meaning changes to the policy remain possible and the Chancellor may still opt to announce an increase in the state pension age.
Baroness Neville-Rolfe has submitted a new independent review of the state pension age and the Government has a May deadline to publish and respond to her recommendations.