Royal London has warned against a “drastic” proposal to raise the State Pension age to 75.
The Centre for Social Justice, a think tank chaired by former Work and Pensions Secretary and ex-Tory leader Iain Duncan Smith, recently published a report which recommended the change.
The rationale for upping the pension age to 75 by 2035 was cited as “removing barriers” for older employees and “health and wellbeing concerns”.
The report’s conclusion read: “ Removing barriers for older people to remain in work has the potential to contribute greatly to the health of individuals and the affordability of public services.
“Therefore, this paper argues for significant improvements in the support for older workers.
“This includes improved healthcare support, increased access to flexible working, better opportunities for training, an employer-led Mid-Life MOT and the implementation of an ‘Age Confident’ scheme.
“As we prepare for the future, we must prioritise increasing the opportunity to work for this demographic to reduce involuntary worklessness.
“For the vulnerable and marginalised, a job offers the first step away from state dependence, social marginalisation and personal destitution.”
In addition, provided that this support is in place, we propose an increase in the State Pension Age to 75 by 2035.
“While this might seem contrary to a long-standing compassionate attitude to an older generation that have paid their way in the world and deserve to be looked after, we do not believe it should be.
“Working longer has the potential to improve health and wellbeing, increase retirement savings and ensure the full functioning of public services for all.
But Royal London’s Helen Morrissey cautioned against the approach.
The pension specialist said: “While such proposals will undoubtedly save money, raising state pension age so quickly will cause huge issues for many retirees who will not have been given adequate time to prepare.
“We need to give careful thought to what kind of jobs people in their 70s are able to do and while some people will be able to work on for longer others simply won’t be able to.
“These people will face severe financial hardship if they have not saved enough into a pension to cover the years between leaving work and claiming state pension.”
She added: “The Government needs to think carefully before taking such drastic action.”