Womens’ pension robbery warning
Ministers are being urged to end a retirement 'robbery' which could force half a million women in their late 50s to work longer and lose out in thousands of pounds in state pension payments.
The Government is proposing bringing forward the date it plans to raise the retirement age to 66 for both men and women to 2018 - two years earlier than planned.
But the changes to the original timetable means that 500,000 women aged between 56 and 57 will have to wait for more than a year longer than they planned before receiving the state pension sparking fears that their retirement plans will be derailed because they have too little time to adjust to the increase.
Ministers are currently consulting on a range of reforms to the state pension, which also includes plans to scrap means testing for a guaranteed flat payment of �140 a week aimed at ending a system many believe penalises women, low earners and the self-employed.
But while the plans have been largely welcomed plans to equalise the state pension age, Labour has warned that the 300,000 women born between December 6 1953 and October 5 1954 will have to wait an extra 18 months, while an unlucky 33,000 born between 6 March 6 1954 and April 5 1954 will have to wait an extra two years, before being entitled to their state pension.
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The opposition said that the majority of these women will already be well under way in their plans for retirement, with many already working reduced hours in order to care for grandchildren or elderly parents. Yet they are now being forced to make significant changes to their financial plans, with just five years notice before the changes kick in.
And it said that those born between March and April 1954 are set to lose around �10,000 in lost state pension or more than �15,000 if they get the full pension credit, with less than seven years to try and accommodate the change.
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But the issue has also raised alarm bells on the government benches and Norwich North MP Chloe Smith said she has been holding regular meetings with pensions minister Steve Webb, urging him to look again at how women could be affected.
'I'm pressing ministers on this because a number of women have raised it with me, and it so happens that members of my own family are in this group,' she said. 'It's certainly an issue I sympathise with greatly. It's not a matter for party politics. All parties thinking seriously about the matter, know that equalisation is the right thing to do. I have been in almost weekly contact with the pension's minister about it and I hope he is looking seriously into it.'
Rachel Reeves, shadow pensions minister, said: 'Despite the coalition agreement stating that they would not raise the state pension age for women before 2020, the government have taken another 'U-turn' on their policy. I will be fighting these changes every step of the way to ensure fairness for those approaching retirement feeling that the goalposts keep being moved.'
In April the government changed the state pension rules to allow people to qualify for a full basic pension with only 30 qualifying years of national insurance contributions. Previously men normally needed 44 years and women 39 years.
This month sees the end of a government consultation on the state pensions shake up which were originally put forward in a green paper launched in April.
A Department for Work and Pensions spokesman said: 'In a country where 11m of us will live to be 100, we simply can't go on paying the state pension at an age that was set early in the last century.
'Although women will experience the rise in the state pension age more quickly than previously planned, they will still draw the state pension for an average of 23 years. Our 'triple guarantee' means someone retiring today on a full basic State Pension will receive �15,000 more over their retirement than they would have done under the old prices link.'