Labour plans to introduce “flexible” retirement age

Pension age is due to rise to 66 by the end of 2020. Labour says it plans to commission a new review of the pension age, specifically tasked with developing a "flexible retirement policy to reflect both the contributions made by people, the wide variations in life expectancy, and the different nature of working lives".

It also wants to extend pension credit to 1950s-born WASPI women who "saw their pension age quietly pushed back leaving many of them in poverty".

The manifesto states: "Women born in the 1950s have had their state pension age changed without fair notification. These women deserve both recognition for the injustice they have suffered and some kind of compensation for their losses.

"This must never happen again. So Labour will legislate so that accrued rights to the basic state pension cannot be changed, but future benefits can."

Nathan Long, Senior Pension Analyst at Hargreaves Lansdown, commented: "Labour are making pensions a key battleground in the election. The State Pension figures prominently as they seek to maintain the triple lock, stop planned increases to State Pension Age past 66 and provide compensation for the women who have seen the age they can receive their State Pension rise. We already know the planned increases were due to save the Government £30 billion, so unwinding these will be very expensive. Plans to stop future tinkering impacting on accrued State Pension may be appealing, but risk create huge levels of complexity and are probably best avoided.

"It is curious that they plan a new review of State Pension specifically looking at the challenges of the population having a wide range of life expectancy. John Cridland has only recently conducted a review of State Pension that looked at exactly these issues, presumably this was not sufficient.

"Saving for retirement is somewhat absent, meaning we are unsure as to what the plans are for workplace pensions and whether crucially, the self-employed will be included in the auto-enrolment program that ensures people are automatically joined to a pension plan. We have already seen plans to tax those earning over £80,000 which could easily see a further limiting to tax relief for those impacted."