WPC launches inquiry into early state pension access

In a report published last week, the Committee called on the Government to explore the option of permitting a defined group of women who have been affected by state pension age changes to take early retirement, from a specified age, on an "actuarially neutral basis".
 
This would mean some women could choose to take a state pension sooner than scheduled in return for lower weekly payments for the duration of their retirements. The "reduction factor" used should ensure that, on average, over the lifetimes of the pensioners concerned, there would be no additional pension costs to the exchequer.

Around 300,000 women are affected by the accelerated increase in the state pension age to 66 introduced in the 2011 pensions act. Many more are affected by the changes originally introduced in 1995 which set in motion the increase in state pension age from 60 to 65 by 2020.
 
Following the publication of the report, the Committee is inviting written submissions exploring the fiscal impact of the scheme, how the scheme would interact with pension credit and other benefits, who should be eligible and why, how popular the scheme would be, and the impacts on those people.

Tom McPhail, Head of Retirement Policy at Hargreaves Lansdown, commented:

“This is a forthright move by the Select Committee, which seems determined not to let the Government off the hook on this contentious issue. After several parliamentary debates and repeated refusals by the DWP to countenance any changes to policy, the Select Committee is now set to explore in more detail a measure which could ameliorate the situation of the affected women, without costing the government any money.
 
"Working through the detailed implementation of this idea will be complex, in particular the interaction with any means-tested welfare entitlement. It also needs to be done quickly as the clock is ticking. Perhaps the recent change in personnel at the DWP will open up the possibility of a more accommodating response from the government.
 
"This enquiry and the evidence presented to it may also prove relevant to the recently announced DWP review of state pension ages, to be conducted by John Cridland.”