State pension age set to rise to 68 seven years earlier than previously planned, but government faces battle to secure votes for change.
The government has announced the state pension age will rise to 68 seven years earlier than previously planned.
The change is in line with a government-commissioned report led by John Cridland, former director general of the Confederation of British Industry and published in March this year.
Under current legislation, from December 2018, the state pension age for men and women will increase to 66. It will then rise to 67 between 2026 and 2028 and to 68 between 2044 and 2046.
Cridland's report said the state pension age should rise from 67 to 68 between 2037 and 2039.
Now the secretary of state for work and pensions David Gauke (pictured) has said the government accepts this recommendation.
'This is about the government taking responsible action in response to growing demographic and fiscal pressure,' he said.
In an article for the Financial Times last month Gauke said he was prepared to make ‘big decisions’ on pensions.
Labour said it opposed the government's plans, and stood by its manifesto pledge to keep the SPA as it is.
In response to this announcement, Labour’s shadow work and pensions secretary Debbie Abrahams said the opposition party did not support the government’s decision.
‘Labour wants a different approach, in our manifesto we committed to leaving the state pension age at 66,’ she said.
Gauke said Labour’s approach was ‘reckless, short-sighted and irresponsible’.
‘Fixing the state pension age at 66 demonstrates a complete failure to deal with the situation in front of us,’ he said.
The Scottish National Party also opposed the plan to raise the state pension age above 66.
Tom Selby, senior analyst at AJ Bell, said because of this opposition from other parties it would be very difficult for the government to secure the votes needed to make the change.
‘The government could well face a serious battle to get this unpopular measure through the House of Commons,' he said.
'Labour has already indicated it will oppose such reform and, with a wafer thin majority, only a few rebellious MPs would leave the plans on a political knife edge.'
Former pensions minister Steve Webb, who served under the Conservative-Liberal Democrat coalition government, said bringing forward the rise was the right move.
'The government is right not to have left this increase in the pension age until the mid-2040s. Without this decision people of working age would have faced a heavy tax burden.'
But Steven Cameron, pensions director at insurer Aegon, said the plans would be 'particularly concerning for those who through health concerns, job pressures or lack of employment opportunity simply can't keep working into their late 60s'.
'It's ironic that the government is proceeding with an accelerated increase in the state pension age days after statistics show improvements in life expectancy may be levelling off, meaning this increase may be less justified on affordability grounds.'