TUC: Pension changes are bad news for poorest

Friday, June 25th 2010

The plans to raise the state pension age will hit only the poorest Britons, the Trade Union Congress (TUC) has suggested.

While the organisation admits it is in favour of pensions secretary Iain Duncan Smith's proposals to end the arbitrary retirement age of 65, his policy of starting state pension handouts at 66 could mean money worries for scores of older people.

One issue to contend with is that the richest can expect to live longest, with a 65-year-old man in Kensington, London averaging a further 23 years of life from the point of retirement.

This could mean poorer people, such as those in Glasgow where the average is only 14 more years, miss out on a significant portion of their planned pension cash.

"Raising the state pension age will not help any of them stay in work. It will simply turn a generation of 65-year-olds from pensioners into the unemployed," says Brendan Barber, general secretary at TUC.

Further money worries may have been caused for many this week by the government revealing it is to up the rate of VAT to 20 per cent.