Pensions  

Actuaries calls for early access to state pension

Actuaries calls for early access to state pension

The government should consider giving people with shorter life expectancy early access to the state pension to offset the potential inequity of increasing retirement age, the Association of Consulting Actuaries has argued.

In a submission to the Independent Review of State Pension Age, the ACA stated it would be “increasingly difficult” to continue to push up the universal state pension age in step with increasing longevity.

This, the submission argued, was because while overall life expectancy was on the increase, the differences in life expectancy between different “sectors of society” would persist, meaning a flat retirement age would be unfair.

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But the ACA argued that, rather than having different state pension ages for different sections of society - which it said would be too difficult - the government should target individuals with shorter life expectancy.

The association suggested allowing “broadly actuarially neutral early access to the state pension” - though it added there would be costs associated with implementation and means-testing implications.

The ACA claimed other options, such as granting early access to individuals meeting certain ill-health criteria, or basing it on length of working life, would involve additional costs and would require reduced state spending elsewhere or a higher state pension age for the rest of the population.

The state pension review is being chaired by former director general of the Confederation of British Industry, John Cridland.

He is expected to deliver his findings to Damian Green, secretary of state for work and pensions, by May 2017.

Mr Cridland said of his appointment in March: “I look forward to meeting many stakeholders, hearing the views of experts and the experience of organisations working in this area to help shape the review.

“I know how important this issue is, and will consider all the evidence to ensure that we have a state pension age fit for the future.”

james.fernyhough@ft.com