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Too much froth in Laird’s pensions fury

Raising the state pension age and bringing the date forward was never going to be popular. No wonder David Gauke, the Work and Pensions Secretary, announced the latter change just before he jetted off on holiday.

Opposition MPs have been in a froth, accusing the government of reneging on earlier commitments and betraying another generation of future pensioners. New shadow Scots Secretary Lesley Laird described it as a “disgraceful and unjustified attack” on the state pension. 

But hang on a minute. The argument put forward by the WASPI women – those born in the fifties and being forced to wait up to six years for their state pension – may be one thing, but the outrage over this latest change looks a little like political posturing, or plain ignorance.

Yes, the data produced by the House of Commons library shows that raising the state pension age will affect 611,000 Scots. Labour is spitting tacks over “this Tory Government, which is asking millions of people to work longer to pay for its failing austerity plans.”

This is nothing new. Plans to extend the state pension age have been known about for years and the number of Scots affected will have barely changed since the proposals went through the Commons.

What has changed is the date of bringing about the delayed SPA and even this was expected. Last week’s decision brought forward by seven years the change from 67 to 68, a move that had been recommended in March by former CBI director general John Cridland in his review. If Mr Cridland’s recommendation had been rejected then no doubt the anger from the opposition benches would have focused on how the government was ignoring the advice of its own consultation process.

The shadow Scots Secretary needs to keep up. If she is apopletic over this latest change then it’s worth reminding her now that a separate report from the Government Actuary’s Department, also published in March, pointed to a possible SPA of 70 for anyone currently aged 30 or under. Be warned, Mrs Laird, that change may soon be upon us.

Where she is on stronger ground is in her argument that the decision to bring the change forward followed evidence from Professor Sir Michael Marmot that a century-long rise in life expectancy was ‘pretty close to having ground to a halt’.

This was also a puzzle to some of those working in the pensions industry. Of course, the answer to that lies in the pensions budget.

Labour argues that the austerity programme is the cause of the change to the SPA and even ministers would admit that bringing it forward seven years will cut £74 billion from the pensions bill.

Depending on which way you look at it, this is either prudent use of taxpayers’ money, or daylight robbery on the 7.6 million individuals in the affected age range who each stand to lose £9,800.

Labour wants to put a brake on the change while it takes another look at this issue. But it will still have to face up to the rising cost of state pensions and the state’s ability to pay for them.

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