Comment by Joseph Lu on state pension age linked to longevity.
23 March 2011
Legal & General's Longevity expert, Joseph Lu commenting on the announcement by George Osborne in today's Budget that the Government will be seeking a 'more automatic mechanism' for increasing state pension ages linked to longevity;
"Over recent years it has been established that the population of many industrialised countries, including the UK, are living longer. In the next 20 years, the number of people over the age of 65 in the UK is expected to increase by about 5 million. Projections from the UK Office of National Statistics, for example, show that the proportion of people within the UK who are 65 years and older is projected to grow from 17% in 2011 to 25% by 2052.
In addition, once we get to retirement age we've been living longer. Retirees in the UK at aged 65 have seen their life expectancy increase by more than 2 years over the last decade and we expect people at retirement age to continue to live longer.
This will mean that the proportion of those in work versus those in retirement will change drastically over the next few decades, potentially increasing the pressure of the working population to fund the state pension of the retirees. So linking future rises in the state pension age to longevity looks a sensible option to explore."
Notes to editors
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