A shake-up of the British pensions system is being recommended.
People are going to be asked to work longer and save harder before they retire. That is what is being proposed in a long-awaited report by a government-appointed Pensions Commission. The proposals mean people could be working until the age of 68 by 2050. When the Beatles sang: ‘Will you still need me, will you still feed me, when I’m 64 ?”, pensions were not a pressing problem. Now things are different in many industrialised nations where people are living longer while birth rates are falling. The result is that there are fewer workers to support an increasing number of pensioners. Although Britain is far from being the worst case, it is widely felt that its private and state sector retirement systems should be reformed to deal with the changes. That is why the Pensions Commission was appointed to look at what needs to be done. The retirement age varies in European countries, with men and women often calling it a day at different times. In Britain, a gap between the plight of public and private sector staffhas added tension to the debate, amid claims a two-tier system is being created. It comes after the government struck a deal that will allow millions of existing public sector workers to continue to retire at 60. Meanwhile, the retirement age for others looks set to go up and up. State sector staff have fought hard to hang onto their retirement rights, even threatening strike action. From next year, however, the normal pension age for new workers in health, education and the civil service will be 65. Kay Carberry of the Trades Union Congress rejects talk of double standards. “We have been told quite a lot about so-called ‘gold-plated’ public sector pensions,” she said. “The average public sector pension is between four and five thousand pounds. It is not riches. We are talking about nurses and low-paid civil servants and teachers.” But anger is rising among privately-employed workers, many of whom feel their contributions to state coffers are being used to finance an earlier retirement for their public sector counterparts.