Will the UK state pension age rise to 71?

The UK state pension age will need to be increased to 71 by 2050, according to a recent report from the International Longevity Centre (ILC).

The report explained that if we are to maintain the ratio of workers to retirees, the state pension would have to be increased from the current 66 years to 71 years by 2050.

The state pension age is currently due to rise to 67 years between May 2026 and March 2028, and then expected to rise to 68 years from 2044. However, the report warned that “longer term, the pressure will be on to increase it to 68 or 69 before that.”

Les Mayhew, associate head of global research at the International Longevity Centre and author of the report "State Pension Age and Demographic Change", said: "In the UK, state pension age would need to be 70 or 71 compared with 66 now, to maintain the status quo of the number of workers per state pensioner."

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In a separate report by the Resource Solutions, despite being furthest away from retirement age, 72 per cent of Gen Z (1997 – 2012) workers said they were worried they may not be able to stop working at the state pension age because of financial hardship, followed by millennials (1981 – 1996) at 70 per cent.

An aging population

In September 2023, the Office for National Statistics (ONS) released statistics showing that over the past century, the number of centenarians living in England and Wales has increased 127-fold, shown in Figure 1 below. Figures are reported to have hit a record high of 13,924 centenarians in 2021; of this number of centenarians, 11,288 were women and 2,636 were men. 
 

Figure 1. The number of centenarians in the population increased rapidly from the second half of the 20th century, Source: Historic Census data (1991 to 2021) from the Office for National Statistics

ONS report the UK ranking as the seventh country worldwide for the highest number of centenarians and in 2021, the ONS reported that there has been a 24.5% increase from 2011 of centenarians living in England and Wales.

Find out more in our article: Living to 100 years - are you financially prepared?

What does this mean for the UK?

As the report from the ILC outlined that in the UK, state pension age would need to be 70 or 71 compared with 66 now to maintain the status quo of the constant number of workers per state pensioner. If this number were to drop it would create numerous issues around the working population being able to support the retired population. A smaller working population and a large economically inactive population paves the way to labour shortages which inevitably will need to be filled by migrant labour, creating additional complications.

A possible solution discussed in the report involved enabling people to work for longer to make up the difference. However, as the report outlined, research shows that by age 70, 50% of adults have some sort of disability that restricts or completely eliminates their potential to work and be economically active.

With the state pension age on the rise, it’s more important than ever to manage your retirement plans carefully to ensure you don’t get caught out. We’re offering anyone with savings, pensions or investments of £100,000 or more a free financial review worth £500. If you want to find out more why not give us a call on 0333 323 9065 or book a free non-committal initial consultation with one of our chartered advisers to find out how we might be able to help you.

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