Retirement for women 'should be set at 65'

Click to follow
The Independent Online
WOMEN should work until they are 65 to bring their pension age into line with men's and to release pounds 3bn for increasing the incomes of Britain's poorest people, the Government's social security advisers argue today.

The switch should be phased in over 15 years, beginning in 2000, to cushion the impact on working women. No woman now over 52 would be affected.

The Government began a review of state pension ages, now 60 for women and 65 for men, last year after the European Court ruled that occupational pension scheme ages should not discriminate between the sexes. State pensions account for about half of all social security spending. In its submission to that review, the independent Social Security Advisory Committee comes down firmly against the widely-floated idea of a 'flexible decade of retirement'.

Under this scheme, individuals would be able to take a state pension at any age between 60 and 70, with payments linked to the age at which they retire. Sir Peter Barclay, committee chairman, said yesterday: 'The advantages of the 'flexible decade' of retirement are largely illusory. People in vulnerable groups, such as those in ill- health, would feel they had no option but to take their state pension at 60. But they would have less than had they left it until later, and so the effect might be to increase poverty and dependence on state benefits.'

Setting a pension age of 60 for both sexes would cost an extra pounds 3.4bn that would have to be raised by increasing taxes or cutting public spending in other areas, the committee says. 'This would mean giving men a huge gift from the state, regardless of need,' Sir Peter said. Another option of fixing the age at 62 or 63 for men and women would not produce the scale of savings required to recycle to those on the lowest incomes, Sir Peter added.

State pension ages vary widely in Europe, but both Germany and Italy have plans to fix them for both sexes at 65 early in the next century. Danish men and women have to go on working until they are 67. Only France, Greece and the UK allow women to collect their pensions as early as 60.

The UK government's social security advisers have placed the needs of people on low incomes at the heart of their proposals. They say that if ministers opt for their scheme, the savings must be invested in improving benefits for those in greatest need. They want to see an income support premium for those aged 55 and over who are either unemployed for over two years or long-term sick.

They also want the invalid care allowance raised from pounds 32 a week to pounds 54, to help carers - mainly women - who give up jobs to look after a relative at home.

The report 'recognises the increasing economic activity of women, but the reality that such activity remains bound by the interruptions caused by child rearing and caring for others.'

The Government's final decision on how to equalise pension ages is expected later this year.

Donald Dewar, Labour's social security spokesman, said there was 'a strong case for a flexible approach, with men and women having the same right to nominate their retirement age between the ages of 60 and 70'.

Options for Equality in State Pension Age: A Case for Equalising at 65; Social Security Advisory Committee; HMSO; pounds 5.85.

----------------------------------------------------------------- STATE PENSION AGES ----------------------------------------------------------------- Country male female ----------------------------------------------------------------- Belgium Flexible pension age 60-65 Denmark 67 67 France 60 60 *Germany 63 63 Greece 65 60 Irish Republic 66 66 **Italy 60 55 Luxembourg 65 65 Netherlands 65 65 Portugal 65 62 Spain 65 65 United Kingdom 65 60 ----------------------------------------------------------------- *Germany plans to equalise pension age at 65, phased in by 2012 **Italy plans to equalise pension age at 65, phased in by 2016 ----------------------------------------------------------------- Source: Options for Equality in State Pension Age DSS (1991) p34 -----------------------------------------------------------------

----------------------------------------------------------------- SUPPORT RATIO (People of working age per pensioner) ----------------------------------------------------------------- 1990 2012 2030 2050 Present scheme 3.4 3.1 2.4 2.6 Common pension age 60 2.6 2.0 2.2 Common pension age 65 4.0 3.0 3.1 ----------------------------------------------------------------- Source: Department of Social Security, December 1991 -----------------------------------------------------------------

Comments