State pension age may hit 70 for those now in their thirties, experts warn

People in their thirties may not get a state pension until they reach 70 years of age because of the “pressure” being placed on the system, experts have warned.

The age at which people receive the weekly payment is set to rise to 67 between 2026 and 2028 before hitting 68 by 2046 with experts saying it could hit 70 by as soon as the mid-2050s.

Former pensions minister Steve Webb told i that a move to increase the state pension age to 70 within the next 40 years “could not be ruled out”.

This could mean that today’s 30-year-olds would not hit the state pension age until they were 70.

Tom Selby, director of public policy at AJ Bell, said changes could come even more quickly.

“Given the scale of the demographic timebomb hitting the UK and the fact there are already plans in place to increase the state pension age to 68 by 2046, it is not hard to imagine a future government setting out plans to increase the state pension age to 70 and possibly beyond by the mid-2050s,” he said.

If the state pension age were raised to 70 by 2055, that would mean those born in 1985, who are 38 or 39 currently, would not get their state pensions until then.

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Webb, now a partner at LCP, said that his projection was based on estimations given to the Government.

“The current government has undertaken two reviews which both advocated moving to age 68 sooner than the current legal timetable of 2046, but no law has been passed to implement such a change,” he explained.

“However, if a future government decided on a more aggressive timetable a move to 69 and even 70 within the next 40 years could not be ruled out based on estimates provided to the Department of Work and Pensions by the Government Actuary,” he said.

In a state pension age review last year, the Government was told that if it were to decide that the state pension age should be set so people spend 30 per cent of their adult life in retirement, it should be raised to 70 between 2062 and 64, though no legal timetable has been set for this.

Webb said that an increase in the state pension age to 70 would “raise some serious issues about fairness, particularly in parts of the country where healthy life expectancy is well below 70 and many people will have stopped work long before this age.”

Selby added: “While projected life expectancy improvements have stalled in recent years, the average life expectancy of Britons is still predicted to increase substantially in the coming decades.

“If those life expectancy improvements come to pass, the demographic pressure already placed on large parts of society, including the state pension system, will increase. That, in turn, will force future governments to consider how to control the cost of paying the state pension to a larger number of people for longer.”

He said potential increases to the state pension age “emphasised the importance of setting up a savings plan and building your own pension pot.”

The predictions come as the latest increase to the state pension, under the triple lock mechanism, kick in.

It ensures the state pension rises by the highest rate of inflation, earnings growth or 2.5 per cent each year. Pensioners have seen an 8.5 per cent rise this April, though there are concerns over the long-term cost of the policy.

Prime Minister Rishi Sunak said the triple lock would remain in place throughout the next Parliament if the Conservative Party wins the forthcoming general election, but economists have previously warned this could cost as much as £49bn.

Ex-ministers have also told i that state pension age increases could be sped up because of the triple lock.

Labour are also likely to commit to the Triple Lock in their manifesto, but it is unclear whether this would be for the duration of a whole Parliament.

Whoever wins the General Election will be under pressure to reform the triple lock, however, due to concerns over its long-term affordability.

Lord Willetts, a former Tory MP, told i the “precedent and evidence so far” indicates that the triple lock makes faster increases in the pension age more likely.

The Government plans to raise the pension age from 66 to 67 between 2026 and 2028 and has scheduled a further review within two years of the next Parliament to consider recommendations for an earlier rise to age 68, which it is currently scheduled to reach between 2044 to 2046.

A Government spokesperson said: “There are no plans to accelerate the timetable for raising the state pension age, which was reviewed and maintained last year.

“State Pension is the foundation of income in retirement and will remain so as we have delivered a further 8.5 per cent rise, increasing the state pension for 12 million pensioners. This sees the full rate of the new State Pension rise by £900.”