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Workers unwilling to delay retirement

Rachel Stevenson
Monday 25 July 2005 00:00 BST
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A study, published today by the Institute of Public Policy Research, found the public does not believe that life expectancy is increasing and people do not accept they may need to work beyond 65 before collecting their state pension. People still expect their health to decline at 70 and see the retirement age of 65 as "sacred", the study found.

Peter Robinson, author of the report, said many people were not facing up to facts about how long and how expensive their retirement is likely to be. "Someone who will be 65 in 2051 can expect to live until they are 87 if they are male and to the age of 90 if they are female," he said. "In the 1970s, people retiring at the age of 65 would only live until their late 70s. But people don't seem to believe the evidence and still think they will live to the same age as the parents and should retire at the same age."

The institute is urging the Government to raise the state pension age to 67. Mr Robinson said: "People retiring at 65 now need their pension to last 20 to 25 years. The arithmetic does not add up. It is great news that we are living longer, but it also means we will have to work longer." When the pension system started there were 10 people in work for every one in retirement. Now there are four people working for every pensioner. Within 50 years, there will only be two workers per pensioner.

Stephen Timms, the Pensions minister, said: "The Government has no plans to raise the state pension age but welcomes giving people increased choice; for example, voluntarily deferring their state pension for a few years."

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