Further calls to raise pension age

Increasing the state retirement age is the "logical way" to improve the state pensions system, it has been claimed.

10:50 26 September 2005

Increasing the state retirement age is the "logical way" to improve the state pensions system, it has been claimed.

The Pension Policy Institute (PPI) has recommended that the government consider increasing the state retirement age as a part of a strategy to counteract the predicted pension crisis.

In a review of the pension debate, the PPI has predicted that later-working will become the natural choice of many individuals, in response to demographic and social trends. However, it concedes that at present the public may be deterred by negative preconceptions of later working.

The PPI urges the government to counteract public misunderstandings, particularly the notion that later working equates to "work till you drop". It recommends that an independent body, investigating health, demographic and work trends, may improve public attitudes.

To facilitate later working the government must also encourage employers to support their older employees, it was further argued.

The PSI recommends a measured increase of the retirement age, targeted first at those currently under 40. It argues that this would send the message that later-working will be necessary whilst pre-empting what it predicts as a natural trend.

The Institute of Directors and business leaders group CBI are also urging the government to increase the retirement age. They warn of a public sector worker pensions crisis unless the retirement age is raised from 60 to 65.