State pension age ‘can be hugely problematic’ – Rishi Sunak urged to grant early access

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The number of unemployed older workers has shot up by a third during the coronavirus pandemic, official statistics show. More than 340,000 people aged 60 to 64 are now unemployed – an increase of almost 85,000 on the last quarter (April to June 2020).

It’s prompted calls from Age UK for the government to help those at risk of long-term unemployment in the run-up to receiving their state pension.

The charity has suggested those nearing state pension age get early access to the payment, as well as a reduction in the age of eligibility to provide crucial money benefits to help the most disadvantaged.

With current job vacancies in short supply, the charity is warning a “perfect storm” is on the horizon for many over-50s who work in sectors badly affected by the pandemic.


It adds that even in a buoyant job market, systemic ageism can make it extremely difficult for many unemployed older people to find work.

A new report by the Pensions Policy Institute (PPI), Longevity Inequality – sponsored by Age UK and published today – lays bare the widening inequality gap between rich and poor in later life even before the pandemic hit.

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The research shows that in the five years between 2012 and 2017, the difference in life expectancy between the most deprived and the least deprived individuals (men and women) grew by eight percent.

The Chancellor of the Exchequer Rishi Sunak recently announced the new Restart scheme, but Age UK is warning the Government must ensure the new scheme – along with Jobcentre Plus – delivers the support that older jobseekers need to get back into work.

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State pension age is currently rising; it is set to increase to 67, coupled with a further review of the state pension age due by 2023.

Amid this, Age UK is calling for urgent government action to safeguard the financial futures of unemployed older workers who are facing a long and difficult wait for their state pension.

The charity is urging:

  • Early access to the State Pension for those within three years of their state pension age (SPA) who are unlikely to be able to work again due to caring responsibilities, a disability, or long-term joblessness.
  • The age of eligibility for vital money benefits such as Pension Credit and Housing Benefit lowered to help all older people struggling to manage on a low income. Additionally, it says take-up should be encouraged to help the millions of older people currently missing out on Pension Credit worth £1.6billion a year.
  • Back-to-work support and access to training must be ramped up by the Government to help all unemployed or struggling older workers to find a way back into the workplace.


The current government policy is to increase state pension age to ensure that individuals, on average, spend approximately a third of their adult life in receipt of the state pension.

However, the new PPI/Age UK report has set out how a single state pension age can be “hugely problematic” for those on the lowest incomes.

It shows that even in non-pandemic times, many older people struggle to make it to state pension age, through no fault of their own.

Around 50 percent of those reaching retirement are expected to live long enough to spend a third of their adult life in receipt of state pension, according to the report.

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However, some of the population can expect to get the state pension for significantly less of their adult life.

Despite those on lower incomes being invariably more reliant on the state pension, a lower life expectancy means they receive it, on average, for much less time than their wealthier counterparts.

Currently, half of pensioners derive nearly two-thirds (64 percent) of their income from the state.

Statistics show men in the lowest ten percent receive the state pension for just over a quarter of their adult life (26 percent), compared to those in the highest 10 percent who receive it for a third of theirs (33 percent).

This marks a difference of six years.

Caroline Abrahams, Charity Director at Age UK, said: “It’s deeply worrying that there are so many older people falling out of work and struggling to get back in.

“With the unemployment rate across all generations shooting up, we need urgent action from the Government to help – they must ensure that the new ‘Restart’ scheme and Jobcentre Plus are delivering the support that older jobseekers need and ensure they are not left on the scrapheap.

“The pandemic looks likely to cause lasting damage to the labour market, leaving many older workers unexpectedly facing a deeply challenging and uncertain future.

“Unless measures are brought in quickly to help them keep their jobs and to support those who lose them, it seems certain that hundreds of thousands will soon be staring prolonged unemployment and premature retirement in the face.

“This new report shows just how much inequality there is among older people, even before the pandemic took hold – an important reminder that the differences in income and wealth within generations are greater than those between them.

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“Given the impact of the pandemic on the jobs market, we strongly believe that it is only fair for some groups who are within three years of their state pension age to have early access to their full State Pension. We are thinking particularly of people who are never likely to be able to work again because of caring responsibilities, a disability, or because their chances of getting another job are particularly slim.

“Furthermore, the Government should also lower the age of eligibility for benefits such as Pension Credit and Housing Benefit to support these older people. Action of this kind would have multiple benefits.”

“Unless the Government takes bold action, hundreds of thousands of older people could face a dire end to their working life and a long, painful road to retirement.”

Chetan Jethwa, Policy Modeller at the Pensions Policy Institute, said: “On average, people are living longer within the UK. However, the increases in life expectancy are not shared equally among the population.

“Shifts in healthy life expectancy are also distributed unevenly among the population.

“The briefing note highlights the changes to inequalities linked to depravation in life expectancy and healthy life expectancy.

“People with the lowest incomes are less likely to recover from physical difficulties, making it more difficult for them to work, save and prepare for retirement over the later stages of their working lives.

“Policies targeted at this inequality during working lives could reduce the impact is has on people’s retirement.”

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