Here are the recent and future changes to the state pension age, so you can find out when you will be allowed to retire.
What is happening to the state pension?
The state pension age is rising. And it’s happening at breakneck speed.
For donkey’s years, the age at which you could claim your state pension benefits was 65 for men and 60 for women.
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But huge jumps in life expectancy have seen costs shoot up for the Treasury, which is paying some pensioners for more years in retirement than they spent paying National Insurance as workers.
Both men and women’s state pension ages have risen to 66, as of 6 October 2020. And between 2026 and 2028, they will both rise again to 67.
The increase to age 68 is currently scheduled to happen between 2044 and 2046, which would affect those born on or after April 1977
A previous Government review already recommended this should be brought forward to 2037-2039, meaning people born in the early 1970s could be forced to postpone retirement.
The Department for Work and Pensions will have another look at the issue in a review conducted before spring 2023.
This will look at whether hastening the age rise to 2037-2039 is justified based on the latest life expectancy data, the costs of an aging population and the state pension, and labour market trends.
The exact date that you get your state pension will depend on the year you were born. You can work this out using the state pension calculator.
Why is there controversy over women’s state pension age increases?
Many women born in the 1950s face financial hardship while they wait longer than they expected to draw the state pension.
A version of the plans to equalise men and women’s state pension age was outlined in 1995, when the then Conservative Government stated the intention of gradually raising women’s retirement age to 65 between 2010 and 2020.
This was followed in 2007 by a Labour announcement that both men and women would see their retirement age go up to 66 between 2024 and and 2026.
But in 2011, Chancellor George Osborne brought forward the timing of both changes to 2018 and 2020 respectively, hitting women particularly hard because their increases happened both sooner than expected and in quick succession.
Initially, the overhaul included a cap of a maximum two years’ extra wait for a state pension, but protests led to the cap being reduced to 18 months.
The Women Against State Pension Inequality or WASPI campaign says it agrees with equalising women’s and men’s pension ages, but not the ‘unfair’ way the changes were implemented. It is fighting for measures to cushion the financial blow.
A separate group, BackTo60, brought a legal challenge but this was dismissed by the Court of Appeal in September 2020.
The Parliamentary Ombudsman has since accused the Government of ‘maladministration’ over delays to informing women about the changes.
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It has now moved on to consider ‘the impact that injustice had’. After that stage of the Ombudsman’s investigation, it is expected to make recommendations to remedy what happened.
However, it remains unclear whether the Government will have to stump up some kind of compensation to women, many of whom have struggled financially because they were unaware of the delay in when they could draw a state pension.
Who can get a state pension?
Not everyone is entitled to the full state pension, which is a regular payment from the government until you die. Eligibility depends on meeting certain criteria.
As well as being the required age, you must have made National Insurance contributions during your working like, or have paid voluntary National Insurance, or received credits from the government for years spent caring or other issues.
Until April 2016, workers needed to have 30 years of qualifying National Insurance contributions to get the full basic state pension, but everyone retiring since then will need 35 years of contributions to get the new flat rate state pension.
However, even if you paid in full for a whole 35 years, if you contracted out for some years on top of that it might still reduce what you get.
How much is the state pension?
The basic state pension is currently £137.60 a week and next April it is due to rise by 3.1 per cent or £4.25 to £141.85, or around £7,370 a year.
That is topped up by additional state pension entitlements – the now abolished S2P and Serps – if you paid for them during your working years.
The two-tier state system has changed for people retiring since 6 April 2016, when it was replaced by a new ‘flat rate’ state pension.
The full flat rate for people retiring since 2016 is currently £179.60 a week and will rise in April by £5.55 to £185.15, or around £9,630 a year.
However, people who have contracted out of S2P and Serps over the years will get less than this.
Everyone gets the option of deferring their state pension to get more in their later years, and of filling in gaps in their NI record or buying top-ups.
If you delayed in the past, the rules were more generous, but if you reached state pension age since April 2016 you still get the option of an increased state pension for the rest of your life.
Also, you can stop claiming the state pension after doing so for a period. If you carry on working after state pension age, you don’t have to carry on paying National Insurance contributions, but you will have to pay the new social care levy.
The state pension increases every year according to the triple lock, which means whichever is the highest of earnings growth, the inflation rate or 2.5 per cent.
However, the Government dropped the earnings element from the 2022-2023 rise, because wage growth was temporarily distorted to more than 8 per cent due to the pandemic.
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