Pensions - Articles - Falling life expectancy for women pour fuel on SPA debate


Comment from Ian Browne, pension expert at Quilter on the ONS statistics about the changing healthy life expectancies for men and women and their impact that these have on the state pension age.

 ONS statistics released today which show healthy life expectancy for women is falling, with women living 19 years in poor health, pours fuel on an already blazing debate about the recently increased age at which women can access their state pension. Just last month a group of women won a judicial review into the increased pension age for women which is set reach age 66 in 2020.

 According to the ONS, a women could potentially suffer in poor health with no means of working for around three years before they are able to access the state pension at the new age of 66. Considering the average life expectancy of a women in the UK is now 82.9 years, the statistics show that they potentially start to suffer with ill health 19 years before they die at the age of 63, three years before they are able to access any state pension. This creates a situation where hundreds of thousands of people struggle financially because they are unable to carry on working but are years away from accessing their pension.

 The statistics clearly highlight that retirement needs are very individualised and a one size fits all approach is very crude. However, conversely as a society we should also look to embrace the principle of everyone being treated equally and fairly – so a regression to different state pension ages for men and women is not appropriate. But that doesn’t mean the Government can bury its head in the sand and ignore this problem because they deem that there are no better solutions. A more flexible approach could be taken with the state pension where we have a standard state pension age with a standard benefit level. Everyone could then have the option to receive a reduced state pension for early access and an increased state pension for late access. This would give people who are in need the ability to avoid a situation where they might be too ill to work but only slightly too young to access their state pension.

 Despite the incessant noise of Brexit leaving little to no time for any other debate, there is a social care crisis silently brewing in the background which desperately needs addressing. Considering the Government’s social care white paper is still yet to be published despite numerous delays, it’s clear that it is not at the forefront of anyone’s mind right now. However, we are in desperate need of a sustainable social care policy and the pressure on the state pension and company pensions won’t be going anywhere. The burden remains on policymakers to provide practical policy solutions to tackle the issues an ageing society brings.

 With that in mind, people need to take how they intend to fund their later life into their own hands. It is now more important than ever to build up your own personal savings throughout your life as early as possible to help fund any necessary care if you fall ill before you can access the state pension. Similarly, these statistics highlight the risk of the UK’s ‘protection gap’. A critical illness product could provide someone with a monetary lifeline if health problems force them to retire before they can access their pension.”

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