On the go: The government should rethink its plans to increase the state pension age as life expectancy estimates show a further decline, according to a former pensions minister.
Figures published on Wednesday by the Office for National Statistics, based on 2020 population data, showed a decline in life expectancy for those at the current state pension age (66) among both men and women.
According to Sir Steve Webb, a former pensions minister and LCP partner, this data reinforced the case for a fundamental rethink of the timetable for increasing state pension ages.
The government wants to raise the state pension age to 67 between 2026 and 2028, with a further rise to 68 between 2044 and 2046.
However, a review of state pension ages in 2017 — which was based on ONS population projections based on 2014 data — has since suggested reaching a state pension age of 68 in 2039, seven years earlier.
But Webb said the data suggested this should be pushed back. He said the new projections suggest that for men and women currently at pension age, their life expectancy was now more than two years shorter than previously thought.
He added that the full impact of Covid-19 had not yet been seen on long-term life expectancies.
“The last review of state pension ages was based on data which is now more than six years out of date. Since then, life expectancy at pension age for both men and women has dropped by more than two years,” he said.
“Such a dramatic shift in such a short space of time calls for a fundamental rethink of the government’s plans for increases in state pension age. With the move to 67 due to start in only four years, [the Department for Work and Pensions] needs to speed up its current review, as the case for rapid increases is simply not justified by the evidence.”
The government’s dilemma is illustrated by the fact that long-term life expectancy is still expected to increase.
Baby boys born in the UK in 2020 are expected to live on average to age 87.3 years, while girls to age 90.2 years. But boys born in 20 years’ time are expected to reach 90.1 years, while girls will reach 92.6 years.
By 2045, the chances of reaching 100 years are expected to rise to one in five for boys and one in four for girls. Boys born in 2020 are given a one in seven chance of reaching 100, while for girls it is a one in five chance.
This article originally appeared on FTAdviser.com
