Our Smaller Firms Pension Survey has pointed to many more firms retaining employees beyond age 66 compared to two years ago and to expectations that typical retirement ages will outpace the increases due to age 66 (by 2020) and 67 (by 2028).
Improving lifespans are clearly a boon, but they have placed considerable strains on the pension system and employers; and stretched many individuals’ personal finances over the last few years. Our findings suggest smaller firms are increasingly looking to retain, or are expecting to have to retain, many more employees beyond state pension age, potentially boosting the incomes of this group. However, conversely, the relative rapidity of change is likely to further exacerbate the intergenerational challenges that are increasingly being highlighted in the media and beyond.
The survey explored some of the changes that should be considered in the review of state pension age (SPA), where an announcement is due in May.
By far the most popular call was for any further change to allow for a flexible SPA from age 66, which is supported by more than half of the survey’s respondents. This was clearly judged to be a more acceptable proposal than outcomes where the SPA might be lower for those in manual occupations or a solution that in some way reflects regional disparities in lifespans.
Copies of the survey reports are at www.aca.org.uk (Publications page).