The Government has announced a change in its plans for the State Pension Age, delaying it by a year for six million people.
The plans will increase the State Pension Age to 68 for people currently aged between 39 and 47. The change will be phased in between 2037 and 2039, seven years early that had previously been proposed.
The Government believes the change will reduce the cost of the State Pension by £74 billion by 2045/46.
In an announcement today, David Gauke, the Secretary of State for Work and Pensions, confirmed that the Government has decided to accept recommendations made by John Cridland.
Mr Gauke told MPs: “As the Cridland Review makes clear, the increases in life expectancy are to be celebrated, and I want to make clear that even the timetable for the rise that I’m announcing today, future pensioners can still expect on average more than 22 years in receipt of the State Pension. But increasing longevity also presents challenges to the Government. There is a balance to be struck between funding of the state pension in years to come whilst also ensuring fairness for future generations of taxpayers.”
With life expectancy on the increase and the Government looking for ways to reduce expenditure, the news comes as no surprise.
The change will affect those born between the 6th of April 1970, or the 5th of April 1978. Anybody born after 5th April 1978 will need to wait further announcements confirming when they can expect to receive a State Pension.
A more in depth look at the changes to the State Pension Age will follow when more information becomes available.