UK Launches Statutory Review of State Pension Age
On 21 July 2025, the UK government officially announced a statutory review into raising the state pension age. This marks the third such review under the Pensions Act 2014. The decision comes amid concerns about rising life expectancy, increasing pressure on public finances, and the long-term sustainability of the pension system, which currently costs around £124 billion a year—about 5% of the country’s GDP. Work and Pensions Secretary Liz Kendall emphasized that the government must assess whether the current retirement age of 66 is still appropriate.
Revival of the Pensions Commission
Alongside the statutory review, the government has revived the Pensions Commission to address deeper issues with retirement savings in the UK. While auto-enrolment has significantly increased pension saving participation, around 45% of working-age adults still do not save for retirement.
Rising Poverty Concerns and the Triple Lock Debate
Studies suggest that future retirees may receive significantly less private pension income than today’s pensioners, further increasing reliance on the state pension.
One of the main concerns is the cost of the triple lock system, which ensures that pensions rise each year by the highest of inflation, wage growth, or 2.5%. Though politically popular, the policy is becoming increasingly expensive, now costing around £31 billion annually.
What Might Change?
Although the review does not guarantee a change in the pension age, many experts believe the government could bring forward the rise to 67 or even accelerate plans for a move to 68. In more extreme projections, some economists suggest that the retirement age may eventually rise to as high as 74, particularly if life expectancy continues to increase and public finances remain under pressure.
Any changes would be subject to a 10-year notice period, but they could significantly affect workers, especially those in physically demanding jobs or without sufficient private savings.
FAQs
1. Why is the pension age being reviewed?
A: Because the law requires a review every six years, and the government is responding to demographic changes, longer life expectancy, and economic pressures.
2. Will the pension age increase for sure?
A: Not necessarily, but it is highly likely. Experts predict it could rise earlier than currently planned, possibly to 67 or 68 within the next two decades.
3. What is the Pensions Commission’s job?
A: To analyze the broader retirement system and make recommendations to ensure that future pensioners are better prepared financially.
4. Is the triple lock being changed?
BNo changes have been proposed yet, but there is increasing debate about whether the triple lock is affordable in the long term.
5. Who will be most affected by changes?
A: People with low incomes, those in manual labor, self-employed individuals, and workers without private pensions will be most vulnerable if the pension age rises.
