• Today marks an important milestone in the Independent Review, which is using evidence to identify the key factors the Government should consider when deciding the future State Pension age
  • Crucial that the Independent Report considers how to avoid deepening inequality and hardship for future generations
  • Report must take account of levels of private saving and ensure it is based on a balance between fairness, adequacy and sustainability
  • Government policies should help more stay in work until State Pension age

“The State Pension is at a critical juncture with questions over its long-term affordability and sustainability. In leading the Independent Report, on assessing the factors the Government should consider in its review of the State Pension age, Dr Suzy Morrisey has a difficult task ahead as ultimately there is no ‘correct’ State Pension age, but as a framework is considered it’s crucial that any recommendations do not risk deepening inequality and hardship for those least able to work for longer. Even at the current level, working until State Pension age is not easy or achievable for everyone./p>

“In balancing the considerations of fairness and sustainability the Independent Report should recognise that the State Pension forms part of a unique intergenerational social contract whereby those at older ages are supported by the taxes paid by those of working age. In our own deliberative research* which asked people what they thought was ‘fair’ there was a broad consensus that future pensioners should enjoy the same guarantees as those currently in retirement, striking a balance between State Pension age and life expectancy.

“A review of the State Pension age should also note that it is intrinsically linked to typical levels of private savings. While the State Pension provides the bedrock of most people’s retirement incomes, private savings are the other part of the equation. The Pensions Commission is currently looking at people’s projected retirement outcomes and our modelling points to issues in the coming decades with current rates of saving insufficient to secure people adequate retirement incomes**. To ensure the Commission’s recommended solutions will be thoroughly implemented, we believe a statutory requirement for the Government to review retirement adequacy every five years, alongside the State Pension age will be necessary.

“The final Independent Report must strike a fair balance between support, adequacy and sustainability. It should recognise that policies need to be in place to help more stay in work until reaching State Pension age and to support people financially who are unable to work until they reach this milestone, given we know a quarter of all 60–65-year-olds already live in poverty***. It’s also important that if the Government decides to make any changes to State Pension age arrangements in the future that there is a clear communication plan in place to ensure the financial security of those approaching retirement is protected.”

*To better understand public views and attitudes to the state pension, the Standard Life Centre for the Future of Retirement commissioned polling from YouGov in 2022 and a large-scale public deliberative project undertaken by the Policy Institute at King’s College London in early 2023. King’s conducted two public workshops in London and Birmingham, with 50 participants at each location, to understand public perceptions of what a suitable state pension means for retirement today and in the future.

**Tomorrow’s problem? Analysing the future impact of DC pension undersaving, Standard Life Centre for the Future of Retirement (October 2024)

***Pre-retirement poverty: Causes and solutions, Standard Life Centre for the Future of Retirement (April 2024)

About Standard Life  

Standard Life is a brand that has been trusted to look after peoples’ life savings for 200 years. 

Today it proudly serves millions of customers who come to Standard Life directly, through advisers and through their employers’ pension scheme. Standard Life is part of Phoenix Group, one of the UK’s largest long-term savings and retirement businesses. We’re proud to be building on 200 years of Standard Life heritage together. 
 
Our products include a variety of Pensions, Bonds and Retirement options to suit people’s needs, helping our customers to invest and save for their future. We’re proud to offer a leading range of sustainable and responsible investment options. 
 
We support our customers on their journey to and through retirement with comprehensive, easy-to-understand guidance so they can invest in the right way for their needs and plan a future they feel confident about. 
 
The value of investments can go down as well as up and may be worth less than originally invested. 

About Standard Life Centre for the Future of Retirement 

Standard Life Centre for the Future of Retirement is a pioneering UK think tank with a bold ambition to help everyone achieve long-term financial security. 

 How we work, save, and retire is changing, and it will look different for everyone. That traditional idea of spending decades in full-time employment and then retiring with a comfortable, guaranteed income is no longer going to be a reality for most people.  

 Standard Life Centre for the Future of Retirement uses research to provoke fresh debate, drive action and influence change so that people can secure their financial future and enjoy a decent standard of living in their later lives. 

 It is led by Catherine Foot, a leading research and policy specialist who was appointed as the Director of the think tank under its previous brand, Phoenix Insights, in June 2021. 

Catherine has over 20 years of experience in the field. From 2015 to 2021, she was Director of Evidence at the Centre for Ageing Better. She has also held senior roles with The King’s Fund and Cancer Research UK.  

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