Lord Turner believes his report regarding future pensions was not radical enough, arguing that the age at which people should receive pensions should be raised more quickly.

He also suggests that those in the public sector should have more flexible pensions.

Four years ago the government used the same report to plan their current policy.

In the coming decades, the age at which people can start collecting their pensions is getting later according to the recommendations in Lord Turner’s Pensions Commission.

People will still be able to retire earlier than the legal pension age, but will not be able to seek state pensions until this point.

In 2024 men and women will have to be 66 in order to receive state pensions. In 2034 this will change to 67, and in 2044 this will rise again to 68. Each rise will be phased-in over two years.

Pension Stability Must Be Solved

However, according to Lord Turner, there are arguments for the state pension age to go up to 70 by 2030.

He said: “If I was redoing my report I would be more radical, arguing for an even faster increase in the state pension age.”

There were also other recommendations made in the policy that are set to become law. This includes the view that increases in state pension age should be linked to rising life expectancy, as well as the idea state pension be linked to average wages, not prices. Also, the introduction of ‘personal accounts’ for those who can’t access a company scheme.

Current economic problems have also forced the strength of company and public sector pension schemes into view.

Deficits are mounting and numerous household name companies have had to close their final salary schemes to new and existing members.

This has led to questions about public sector pensions, but unions and staff argue workers were paid less than jobs in the private sector so decent pensions are part of their employment package.

Public Sector Pensions Fair?

Lord Turner says public sector employees may have to commit to a scheme that’s based on retirement income on an average of their career salary, not their final salary.

“We have to make it sustainable and we have to make it fair. I think it should move to average salary from final salary,” he said.

Life expectancy is important in making pensions fair to different generations as we are unaware now of any major medical breakthroughs that may happen in the future that increase life span.

A Department for Work and Pensions spokesman said “Our bold changes to the state pension system respond to the demographic changes in society. They will ensure the state pension system is sustainable and affordable for the future.

“We have also taken steps to reform public sector pensions to ensure they are affordable into the future. These include ensuring new entrants to the civil service enjoy a pension based on a career average and a retirement age of 65.”

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