Chancellor George Osborne has stated that the state pension age must rise at a faster pace. Chancellor Osborne feels that the pension age for men should be 66 by the year 2016, which is around ten years earlier than the current system.
The Budget states: “Given the challenges posed by an aging society, the government will review when the state pension age will rise to 66. This will be supported by a call for evidence to be launched shortly. The review will be conducted quickly in recognition of the urgent need to press ahead with implementing these changes fairly. The government will also consider future increases to state pension age and how best to manage the ongoing challenges posed by increased longevity.”
Mr Osborne also wants to do-away with the current laws that stop people working after the age of 65. Employers are allowed to terminate the contracts of individuals 65 or over, but this is something that the Chancellor wants to change.
Pensioners will also no longer be forced into purchasing annuities at the age of 75. The Government will examine the current system with an eye to scrapping it completely by next April. Until that decision is made the age will rise to 77.