State pension age is already being increased from 65 to 67 by 2028 but the Conservative Centre for Social Justice said it should be “accelerated” to avoid great cost to the taxpayer.
“Evidence suggests that the UK is not responding to the needs and potential of an ageing workforce,” the Ageing Confidently report out yesterday said.
It calculated that by 2035 more than half of all adults in the UK will be over 50 years of age.
The CSJ said with life expectancy predicted to rise, an ageing society poses “significant challenges to the UK’s fiscal balance”.
“An increase in the Old Age Dependency Ratio (OADR) and a greater demand for public services along with an increase in state pension costs raises questions about the sustainability of our social security system,” the report stated.
The think-tank suggested that getting more people aged between 55-64 into work would cut costs of out-of-work benefits and would help boost the country’s GDP by around 9%.
It added: “Removing barriers for older people to remain in work has the potential to contribute greatly to the health of individuals and the affordability of public services.”
CSJ chief executive Andy Cook said: “By increasing the state pension age, we can help people stay in gainful and life-enhancing employment while also making a sound long-term financial decision.”
But Conservative peer and former pensions minister Ros Altmann said that the proposals “must not be allowed”.
Reports of State Pension Age rising to 75 are shocking. Must not be allowed to happen. Major changes in pension attitudes required due to big life expectancy differentials. Using age as a strict cutoff is not good policy
— Ros Altmann (@rosaltmann) August 17, 2019
The CSJ report made other suggestions including:
- Increased access to flexible working
- Enhanced healthcare support through improvements in occupational health
- Implementation of employee-tailored mid-life MOT (where employees discuss wealth, work and health).
A Department for Work and Pensions spokesperson said: “Everyone’s state pension age is unique to them and in 2017 we raised the future retirement age to 68 so that it is sustainable now and for future generations.
"We’re creating opportunities for people of all generations with record employment.”
Figures released by the DWP last week showed a recent increase in state pension age has caused a drop of 120,000 claiming their pension in the last year.
