Government urged to raise age of retirement to 70
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Your support makes all the difference.The Government was urged yesterday to raise the retirement age to 70 to solve the looming pensions crisis.
With people living much longer than when the current system was set up, the Pensions Policy Institute (PPI) said the Government could not duck hard decisions on the issue any longer.
It suggested that by increasing the pensionable age to 70, payments could be increased at no extra cost from £75.50, at current prices, to £110 a week. Alternatively the state pension could be kept at its current level for people under 75, but increased to £130 a week for older pensioners. Ministers intend to produce a Green Paper later this year on the future of pensions, with the retirement age among the key issues.
The Institute for Public Policy Research (IPPR), a Blairite think-tank, has already called for the Government to increase the official retirement age to 67 by 2030.
But the PPI, a research organisation bringing together academics and pensions experts, wants the Government to raise the retirement age to 70 as early as 2022. People now under 42 would be affected by the change.
Alison O'Connell, director of the PPI, said: "People are living significantly longer. Health and job prospects for the over 65s are improving.
"Working longer can help to fund better retirement income, and the real prize is that, with a higher state pension age, a better state pension can be offered at no extra cost."
The PPI said 90 per cent of people now live to claim their pension compared with just 66 per cent in 1950, and are collecting their pension for an average of eight years longer.
It added that to take full account of these "startling" changes the state retirement age could be as high as 75, and if it was raised to 70 it may have to be put up again as life expectancy increased.
There are currently 10.6 million pensioners in Britain, and the number is expected to rise to around 16 million over the next 40 years, even taking into account the raising of the state retirement age for women to 65 by 2020.
A spokesman for the Department of Work and Pensions said no decision had been taken on retirement age, but the Government was looking at ways of enabling older people to carry on working.
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