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DWP terms calls to lower state pension age 'unaffordable'

written by Bella Palmer
dwp

It comes in response to a petition which urged the UK Government to lower the age people can receive their state pension to benefit young people

The Department for Work and Pensions (DWP) has termed the calls for lowering the State Pension age as 'unaffordable' and 'unfair.'

It comes in response to a petition which urged the UK Government to lower the age people can receive their state pension to benefit young people. The petition calls for the age to return to 60 - having been increased to 66 for men and women in recent years. It said doing so would help in the aftermath of the pandemic.

It said: Young people are struggling to find work and losing their jobs due to the pandemic. Why not allow older people to retire earlier, thereby freeing up jobs for younger people?

There would be a cost, however, surely a far more positive cost than paying Universal Credit? Not to mention the option of restoring the balance back into young people's favour and helping restore their future, it said.

The petition gained 10,000 signatures which meant the UK Government was required to issue a formal reply - published on Wednesday.

It replied: Parliament has voted to equalise the State Pension age (SPa) and subsequent retirement ages for men and women. Reducing it to 60 is neither affordable nor fair to tax payers and future generations.

The statement, issued by the DWP, said official statistics show that the number of people over SPa compared to working age is expected to increase in the near future. It said people are living longer on average and increasing SPa in line with life expectancy changes helps to maintain the cost and sustainability of pensions in the long term.

The DWP added: The State Pension is funded through the tax contributions of the current working-age population. Reducing the SPa to 60 would therefore increase the tax burden of the current working-age population.

It said previous estimates suggested that had the SPa not increased, the total additional cost to taxpayers would've been around £215 billion between 2010/11 and 2025/26. This takes into account State Pension, other pensioner benefits, and savings made on working age benefits.

Addressing concern over employment, the DWP said unprecedented support has been given to help people find work and get the skills they need to return to work.

It mentioned the Kickstart scheme and said that since it was launched last year employers have created more than 247,000 approved vacancies for young people. Around 44,000 young people are said to have started their job.

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