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a former minister has called upon the government Paying people who arrive state pension age For At least five years, even if they die,
Sir steve webbwho was the Pension Minister at that time triple lock Was introduced, the state said pension Age should increase, but urged the Chancellor Rachel Reeves Enacting a five-year “minimum guaranteed payment” that would protect those who are less expected to live as long. Then, if someone dies within those five years, their heirs will receive the payment instead.
Writing in a report for pensions consultancy LCP, where he now works, Sir Steve argued that the pension age should rise by one year every decade to account for increased life expectancy, because people receive the state pension for an average of 20 years.
He said people who die before reaching state pension age but have paid into the system should also get the same guaranteed payments, such as through the working-age bereavement benefit system.
The calls come as pressure grows on Ms Reeves to plug the hole in the country’s finances in the coming months Budget This month.
Sir Steve said I: “Our proposal for a five-year guaranteed minimum payment period represents a ‘something for the few’ reform. People who have paid into the system throughout their lives will be guaranteed that they or their heirs will receive the minimum payment once they start receiving a pension. This would be a concrete way of addressing concerns over unfairness every time the state pension age rises.”
According to the Office for Budget Responsibility, spending on state pensions has increased from about 2 percent of GDP over the past eight decades to about 5 percent currently, which is projected to reach 7.7 percent by the early 2070s.
The fiscal watchdog said in a report released in July that the increase is due to the combined effects of the triple lock policy along with a growing population.
After remaining the same for decades, the state pension age rose from 60 for women to 65 in the 2010s, before reaching 66 for both men and women between 2018 and 2020.
According to the latest figures from the Office for National Statistics, life expectancy in the UK is now 83 years for women and 79 years for men.
In the UK, life expectancy at birth in 2021 to 2023 was 78.8 years for men and 82.8 years for women, while life expectancy at age 65 was 18.5 years for men and 21.0 years for women.
The proposal comes amid reports that the Chancellor will target employee pension contributions to raise more money. She is said to be preparing to limit the amount of a person’s salary that can be sacrificed for extra pension contributions before National Insurance contributions to £2,000 a year.