State pension age increase delayed by Government until after Easter

Work and Pensions Secretary Mel Stride said he agreed the planned increase in the state pension age from 66 to 67 should occur between 2026 and 2028, noting this has been legislated for since 2014.

MPs heard an independent report has recommended the rise from 67 to 68 should take place between 2041 and 2043, four years later than previously accepted by the Government but still earlier than set out in legislation.

Mr Stride said the current rules for the increase to 68 “remain appropriate” but also noted he is “mindful a different decision” might be needed once a further review is conducted within two years of the next Parliament.

This review would assess various factors including life expectancy and public finances. The next election is expected to take place in 2024.

Mr Stride, making a statement to the House of Commons, said: “As a society we should celebrate improvements in life expectancy, which has risen rapidly over the past century and is projected to continue to increase.

“Since the first state pension age review was undertaken in 2017, however, the increase in life expectancy has slowed.”

He added: “Given the level of uncertainty about the data on life expectancy, labour markets and the public finances, and the significance of these decisions on the lives of millions of people, I am mindful a different decision might be appropriate once these factors are clearer.

“I therefore plan for a further review to be undertaken within two years of the next Parliament to consider the rise to age 68 again.”

For Labour, shadow work and pensions secretary Jonathan Ashworth said stalling life expectancy rates are a “damning indictment” of the Government.

He said: “Today’s announcement that they are not going ahead with accelerating the state pension age is welcome, and it is the right one.

“But it is the clearest admission yet that a rising tide of poverty is dragging life expectancy down for so many, and stalling life expectancy, going backwards in some of the poorest communities, is a damning indictment of 13 years of failure which the minister should have acknowledged and apologised for today.”

Former pensions minister Sir Steve Webb, who is now a partner at consultants LCP (Lane Clark & Peacock) raised concerns about the potential for the state pension age to rise in the future.

He said: “It is welcome that the Government has taken account of the big slowdown in life expectancies in recent years and has held off any further increases in state pension ages for now.

“But there is a sting in the tail in the analysis which the Government has published today.

“If it adopts the idea of placing a cap on the share of national income spent on pensions, this would mean a rapid increase in pension ages, including a rise to 69 before the end of the 2040s.

“This would be a draconian shift in policy which would be likely to mean today’s younger workers facing a pension age of 70 or above.”