There’s speculation in the Financial Times today suggesting that the Pensions Commission will announce that the state pension should be higher, but also that the retirement age should rise to 67.
The Pensions Commission is due to publish a report at the end of November and is looking to outline proposals which will overhaul the struggling state pension system.
According to details of the report obtained by the FT, the commission will call for a generous rise in the state pension. This should rise from the current £80 a week to closer to the £109 a week paid out through the means-tested minimum income guarantee. To pay for this increase, the report will recommend that the age at which people can claim the state pension should rise from 65 to 67.
Whilst the rise in the state pension is likely to be welcomed (although will probably not be enough for a lot of people), a rise in the retirement age would be a very controversial matter.
There is also speculation that a National Savings plan will be introduced which makes it simpler for people to sign up for a pension when they start a new job. This is to be modelled on a similar system used in New Zealand.