The proportion of the UK population receiving the state pension is now lower than 10 years ago, despite the ageing population, research has found.
Aegon analysed data from the Department for Work and Pensions (DWP) and concluded that the proportion of claimants in May 2018 was almost 2 per cent lower than a decade ago, with the total number in receipt of the benefit having fallen every year since May 2015.
In May 2008, there were 12.4 million claimants among a population of 61.8 million people, which compared with 13.1 million beneficiaries ten years later, among 66.5m people.
The Office for National Statistics estimated there were about 12 million people aged 65 and above in 2017, 2.2 million more than 10 years earlier.
Aegon stated the downward trend may be due to a number of factors, such as the equalisation of the state pension age.
Since 2010, the age at which women can receive the state pension has risen from 60 to 65 in November 2018, and the age for both men and women is set to increase to 66 by 2020.
Aegon’s analysis also showed discrepancies in claimant numbers between different councils.
West Somerset had the highest proportion of state pension claimants in the UK, with more than a third (34.1 per cent) of its population in receipt of the state pension, rising from 30.9 per cent in 2008.
At the opposite end just one in twenty people in Tower Hamlets was receiving a state pension. The East London Borough has seen a consistent decrease in the number of recipients since 2014 whilst experiencing a boom in population.
All of the bottom 10 local authorities were based within the Greater London region, Aegon said.
Top 10 local authorities by state pension claimants | Bottom 10 local authorities by state pension claimants | ||
Local authority (LA) | % state pension claimants of LA population, 2018 | Local Authority (LA) | % state pension claimants of LA population, 2018 |
West Somerset | 34.08% | Tower Hamlets | 5.00% |
North Norfolk | 31.73% | Newham | 6.12% |
East Dorset | 31.32% | Hackney | 6.60% |
Christchurch | 31.03% | Southwark | 7.32% |
Rother | 30.72% | Lambeth | 7.60% |
West Dorset | 30.29% | Islington | 7.85% |
East Lindsey | 30.07% | Barking and Dagenham | 8.50% |
East Devon | 29.84% | Westminster | 8.58% |
Tendring | 29.39% | Camden | 8.68% |
Arun | 28.03% | Wandsworth | 8.74% |
According to Steven Cameron, pensions director at Aegon, this trend might continue in the future, as further increases to the state pension age are rolled out.
He said: "However, we cannot escape long-term effects of the UK’s ageing population and the strains this will bring on limited resources.
"Regions such as those in the South West of England, will face very different budget pressures from those with younger populations such as Tower Hamlets, where just one in twenty people receive the state pension.
"As we face up to the challenge of funding social care in old age, the government needs to look at how to tailor the level of central government support accordingly at a local level."
maria.espadinha@ft.com
