Monday 20 June 2011

Rise in state pension age for women widely criticised

The coalition’s Pension Bill will raise the age of entitlement to the state pension for women from 60 to 65, leaving nearly half a million women with their retirement plans in tatters.

Critics of the Bill say it is unfair to women as it increases their working life by five years and does not give them enough fair warning.

Currently men can receive their state pension at the age of 65. Women, however, can access their state pension at 60. In order to equalise the state pension age, women will now also have to reach 65 before they claim their entitlement. The Bill proposes to implement this change by 2018.

The Bill also proposes to raise the entitlement age of both sexes to 66 by the year 2020. The previous Labour government had agreed to implement equalisation measures by 2020.

Critics of the Bill, who span across all political parties and include charities and over-50 organisations, say it unfairly affects women who are close to retirement age. They will have to rethink their retirement plans and may have to work between 18 months and two years longer than they planned. Critics also say it is unfair because the women will have had as little as five years notice of the changes.

Conservative MP James Gray said the Bill would cause “an injustice to be done to a small number of people.”

Lorely Burt, the chair of the Liberal Democrat Parliamentary party, said that many of those affected will “be financially a great deal worse off.”

The shadow equalities minister, Yvette Cooper, said the changes to pensions, along with the Government’s cuts to benefits, were an “assault on women”.

She said: “no men will see their pension age increase by more than a year but half a million women will.”

The work and pensions secretary, Iain Duncan Smith, said he would stick to the timetable to raise and equalise the state pension entitlement age. A spokesperson for the Department of Work and Pensions said that if the Government delayed increasing the retirement age to 66, the taxpayer would have to pay £10bn and the next generation would have to shoulder the burden.

However, ministers have said they are looking at ways of softening the blow for women near retirement age.

The Bill and its affect on women is to be further debated in Parliament today (20 June 2011).

For legal advice on retirement, contact Job Justice today. Job Justice works with employment solicitors throughout the UK and can find the right local solicitor for employers and employees in need of legal advice.

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