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Why retiring at age 68 isn't too late
Public sector unions have launched a campaign against government plans to increase the state pension age to 68 but fail to take into account the burden faced by taxpayers.
by Michelle McGagh on May 08, 2012 at 13:04
The row over public sector pensions has been rumbling on for over 18 months now and thanks to strike action planned for Thursday it looks like it is set to continue.
Public sector workers are angry that they will have to work until age 68, rather than 60, and contribute more to their own pensions but receive less when they retire.
It is difficult for private sector workers who do not benefit from taxpayer-funded, gold-plated pensions to sympathise with the strikes.
However, the unions representing public sector workers are clearly trying to get the general public onside with the launch of a new campaign called ’68 is too late’.
Instead of focusing on the disruption the strikes will cause, through this campaign the unions are trying to mobilise the general public to stop the state retirement age increasing to 68, and more than likely beyond.
But before the general public gets behind this campaign, they really have to ask whether 68 is too late to retire?
If you strip the politics out of the decision to increase the state pension age and look at it objectively, it is a move that makes financial sense.
When the basic state pension was introduced in 1948 the average person lived just two years in retirement – not a huge burden on the government or taxpayers.
Now, a person aged 60 can expect to live another 20 years, which is a huge financial burden for taxpayers whichever way you look at it. Looking at the bottom line, the state cannot afford to fund decades of retirement.
Life expectancy is improving by between 1.5 years and two years every decade and it is unrealistic to think that the state pension age will remain static.
Just because we feel entitled to retire at 65 doesn’t mean we should or that we, or the state, can afford to.
The employment debate
The thrust of the unions’ argument against the pension age increase seems to be ‘it’s not fair’, but they have also said increasing the retirement age will have a negative impact on the jobs market for younger people: more old people will be in jobs that young people could have.
More about this:
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