By Keith Aitken in Edinburgh | 23 September 2013
An independent Scotland could choose to postpone the next scheduled rise in the UK pension age, reflecting Scotland’s lower average life expectancy, the Scottish Government said in a paper published today
The paper’s main aim is to reassure pensioners following claims by opponents that independence could put pensions at risk. Ministers promise that the basic state pension would continue to be paid in full and on time, that it would be index-linked to incomes and costs, and that a range of income safeguards would be put in place, including retention of the savings credit element of pension credit.
But Deputy First Minister Nicola Sturgeon also argued that independence would create an opportunity to tailor provision more specifically to Scottish circumstances. She announced that ministers planned to set up an expert commission in the event of a ‘yes’ vote at next year’s referendum to consider the pensionable age most appropriate to Scotland.
Scottish ministers, she said, had accepted the equalisation of pension age at 66 but were not persuaded that Scotland would need to follow the UK timetable to raise it to 67 from 2026.
She said that pensions represented a smaller share of gross domestic product in Scotland than in the UK. Though life expectancy in Scotland was, like the UK figure, going up, it remained lower on average by 2.5 years for men and 2.8 years for women, helping making pensions more ‘affordable’ in Scotland.
‘That’s the benefit of independence,’ Sturgeon said. ‘We get to have Scottish solutions based on Scottish conditions, not solutions imposed on us by the rest of the UK.
‘Successive UK government decisions have resulted in a pensions crisis. Independence will bring decision-making on pensions home to the Scottish Parliament and provide the opportunity to do things differently and better,’ Sturgeon said.
As an example, Finance Secretary John Swinney promised a less confrontational approach than UK Ministers had adopted on public sector pensions.
‘Independence will allow us to harness the considerable expertise that exists in the pensions industry in Scotland to help us deliver a pensions system that incentivises saving for retirement, provides encouragement where it is needed and protects people’s private pension savings,’ Swinney said.
The UK Treasury has estimated that postponing the next rise in pensionable age would cost Scotland £6bn across a decade. In a BBC interview, Labour pensions spokesman Gregg McClymont accused the Scottish National Party of making uncosted promises and of trying to wish away the realities of an ageing society.
But Sturgeon responded that the expert commission would be able to examine the figures in detail and work out what Scotland could afford.
