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What is the State Pension Age and how will it change?

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State pensions have been paid since 1909, but the age at which state pension can be claimed has increased over time. The table below summarises historic state pension age (SPA) changes and anticipated future increases.

On overview of the historic State Pension Age:

Date of Birth

SPA

Man born before 6 December 1953

Identify the relevant risks, governance requirements and areas of focus for the scheme.

Women born before 6 April 1950

Audit current policies and procedures to see if they comply with the relevant requirements and what gaps there are.

Woman born between 6 April 1950 and 5 December 1953

Update the scheme's governance policies, procedures etc.

Born between 6 December 1953 and 5 October 1954 (both sexes)

Prepare for the first ORA if required (or if one is to be adopted as best practice).

Born between 6 October 1954 and 5 April 1960

Undertake regular reviews of the ORA, the ESOG and other matters which require review, noting timescales and new developments.

Born between 6 April 1960 and 5 March 1961 Between the ages of 66 and 67, increasing incrementally by month of birth
Born between 6 March 1961 and 5 April 1977 67
Born between 6 April 1977 and 5 April 1978 Between the ages of 67 and 68, increasing incrementally by month of birth
Born 6 April 1978 and later 68


The SPA is currently set at age 66 for both men and women

The Pensions Act 2014 legislated for a gradual increase in the SPA from 66 to 67 between 2026 and 2028. The increase is phased such that people born between 6 April 1960 and 5 March 1961 will reach their SPA at 66 years plus a specified number of months. A further gradual increase from 67 to 68 is currently planned to take place between 2044 and 2046 for those born on or after April 1977.

The Secretary of State for Work and Pension is obliged to review the rules on the SPA every six years

The last report was published on 19 July 2017, following which the government announced an intention to accelerate the increases in the SPA from 67 to 68 over the period 2037 to 2039, seven years earlier than originally planned. However, no legislative changes were introduced in 2017, with the Department for Work and Pensions (DWP) awaiting the outcome of the 2023 review to ensure that any changes reflected more up-to-date life expectancy changes. In the meantime, those individuals, born between 6 April 1970 and 5 April 1978 have been left not knowing exactly when they will reach their SPA.

A review of State Pension Age

On 14 December 2021, the DWP launched the second SPA review, which must be published by 7 May 2023. The review will look at various pieces of evidence including in relation to life expectancy, the costs of providing a state pension to an ageing population, changes in the labour market and the population's ability to work beyond the SPA.

The review will be informed by two independent reports, one provided by the Government Actuary which will look at the latest life expectancy information and the second which will be led by Baroness Neville-Rolfe DBE CMG on 'other relevant factors'. This second report will analyse recent trends in life expectancy and recommend the setting of SPA metrics. Baroness Neville-Rolfe has issued a call for evidence from members of the public and all interested parties. It looks at questions such as how to achieve intergenerational fairness, changes in the nature of work, and how can state pension costs be managed in a sustainable and affordable way. The consultation closes on 25 April 2022.

What can we expect from the State Pension Age review?

The DWP's press release notes that the 2023 review will "develop options for setting the legislative timetable for State Pension Age that are transparent and fair". There are no straightforward solutions to the issues facing the Government around future trends in life expectancy and the cost of providing a state pension with any increase in SPA likely to be contentious for some. The Government will need to make sure that any further changes are effectively communicated so that those impacted know exactly how they will be affected and have sufficient time to make relevant adjustments to their retirement plans. 
 

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