Changes to state pension age to effect 30 and 45 year olds

The possibility of working until 70 for those aged 30 and under has been raised in two government reports released during March 2017.  The report by John Cridland goes further to the analysis from the Department of Work and Pensions, proposing that those under 45 today will have to work a year longer to 68 before they are eligible for a state pension.
The Cridland report also recommends:

  • A new system for carer's leave.
  • A mid-life MOT.
  • Vulnerable people in their 60's should have access to a means-tested retirement.
  • The option to take an early state pension should be rescinded.
  • The option to defer taking a state pension made available to allow for a higher benefit to paid later.

A decision on both the analysis by the Department of Work and Pensions and the report by John Cridland will be made by the government by May 2017.  


Responding to the reports Rachael Saunders, Age at Work Director, Business in the Community said:

''Business in the Community welcomes the recognition in the Cridland report that supporting people to work longer is a vital part of achieving fairness and equity as the state pension age is reviewed.  We are mobilising business to meet the One Million More target, which would see, on average, 12% more older workers working for each UK employer. Whilst the average age of exit from the labour market has increased over the last decade, it is still not keeping pace with life expectancy.  A number of groups are at particular risk. 

We welcome the mitigations that have been set out for those groups who are not currently living longer and those who, because they are caring for others, or because of their own health, are not able to make sufficient pensions contributions. We support the proposal for elder care benefits for employees – peace of mind whilst at work is hugely important for carers.  We support the proposal for statutory carers leave – a level playing field on this will be good for business, and good for carers.

The Mid Life MOT is a great idea, building on the Mid-Life Career review concept that leading employers have piloted.  The concept of older people as trainers in the report is useful. Already, leading employers are utilising experienced workers to develop those younger, for example through apprenticeship schemes.  It is important not to pigeonhole older workers – some will be ready step back from the day job and refocus on passing on their skills, others will want to pass on their skills, others will be ambitious to be promoted and progress.
There is far more that both business and government can do.  The report sets out the strong evidence on the value of flexible working for older workers.  We know that, even when businesses offer agile work, fewer older workers feel able to take it up. That has to change.  Many employers and individuals will welcome the clarity in the report, which makes it much simpler to plan for the future.  

This is not about “work until you drop”.  The report represents a measured response to our ageing population.  The review settles on 32.87 years of adult life to be spent in retirement, on average.  This is the same average proportion of adult life in retirement that adults have experienced over the last ten years. 

Older workers are a massive untapped resource – for business, and for the economy as a whole.  Still, though, poorer people are not benefiting from the longevity revolution. Business will rise to the challenge of the One Million More target – a key business contribution towards the societal shift we need to make to respond to our ageing population.''

Learn more about the One Million More Target and how you take action >>

Andy Briggs, CEO, Aviva UK, Chair of the Business in the Community Age Leadership Team, the government's Business Champion for Older Workers said:  

"Reviewing the state pension age is a key part of how government needs to respond to an ageing population –  as we are living longer,  we each need to ensure that we appropriately fund our later years. The state pension plays an important role and this report faces up to these key questions.
Working longer, with increased life expectancy, has benefits beyond the purely financial. Many people are choosing to work longer because they wish to stay active and contribute to their community as well as enjoying the social aspects of work. As the Government’s Business Champion for Older Workers I have launched a target to support a million more over-50s in the UK workforce by 2022 to encourage businesses to utilise the skills and experience of their older workers.
I will continue to seek opportunities for greater flexibility in state support for older workers, to maximise opportunities for individuals to balance work, family and other commitments."