The state pension age should be raised to 75 within the next 16 years to help boost the UK economy, according to a Tory think tank.
In a new report, the Centre for Social Justice (CSJ) has proposed an increase of the pension age to 70 by 2028 and 75 by 2035.
The pension age is already set to increase to 67 by 2028 and to 68 by 2046 – but the organisation, co-founded by former Conservative leader and work and pensions secretary Iain Duncan-Smith, wants to see a faster increase.
The CSJ’s latest report said evidence suggested the UK was “not responding to the needs and potential” of an ageing workforce, with hundreds of thousands of people aged 50 to 64 seen as “economically inactive”.
It recommended helping older people “access the benefits of work” by giving support to them and employers, such as increased access to flexible working and training opportunities.
The organisation proposes that the pension age should be increased once this support is in place.
The state pension age is already set to increase to 67 by 2028 and to 68 between 2044 and 2046, although in 2017 the government announced plans to increase it to 68 between 2037 and 2039.
However the CSJ wants to see faster increases to the pension age, and believes the cost of benefits would be reduced by employing more older people while it would boost the UK’s gross domestic product (GDP).
In its report, Ageing Confidently: Supporting an ageing workforce, the think tank states: “Removing barriers for older people to remain in work has the potential to contribute greatly to the health of individuals and the affordability of public services.
“Therefore, this paper argues for significant improvements in the support for older workers.
“This includes improved healthcare support, increased access to flexible working, better opportunities for training, an employer-led mid-life MOT and the implementation of an ‘Age Confident’ scheme.
“As we prepare for the future, we must prioritise increasing the opportunity to work for this demographic to reduce involuntary worklessness.
“For the vulnerable and marginalised, a job offers the first step away from state dependence, social marginalisation and personal destitution.
“In addition, provided that this support is in place, we propose an increase in the state pension age to 75 by 2035.
“While this might seem contrary to a long-standing compassionate attitude to an older generation that have paid their way in the world and deserve to be looked after, we do not believe it should be.
“Working longer has the potential to improve health and wellbeing, increase retirement savings and ensure the full functioning of public services for all.”
CSJ chief executive Andy Cook said: “Right now, we are not doing enough to help older people stay in work and the state pension age doesn’t even closely reflect healthy working life expectancy.
“By increasing the state pension age, we can help people stay in gainful and life enhancing employment while also making a sound long-term financial decision.”
Ex-pensions minister Ros Altmann said the proposed changes “must not be allowed to happen”.
She tweeted: “Reports of state pension age rising to 75 are shocking.
“Major changes in pension attitudes required due to big life expectancy differentials. Using age as a strict cut off is not good policy.”
Press Association contributed to this report.