Longevity think tank Phoenix Insights, part of Phoenix Group, is today calling for the Government to reinvest up to £1billion of the potential savings that will come about if it raises the state pension age again, to support those most negatively impacted by a rise. The last rise in state pension age did not simply lead to everyone working for longer, it also led to increases in rates of poverty and unemployment among those impacted¹.

Phoenix Insights’ new report, Reaching a certain age: Public attitudes to the state pension, reveals that people believe that the state pension is there to ensure everyone has a minimum level of income in retirement (87%) and to support older people who are unable to work (82%).  Fewer than one in ten people (9%) believe that your age should be the main factor determining when you stop working. Phoenix Insights warns that, without action, moving the goal posts again will leave many in a worse position.

The longevity think tank highlights the pressing need to prepare and support people through the expected transition to a later state pension age – especially those facing health issues, redundancy or caring responsibilities which can make it more difficult to work in the five years leading up to state pension age. These groups are among those most likely to be negatively impacted.

Catherine Foot, Director of Phoenix Insights, says:

“Nearly half of the population rely on the state pension for the majority of their income later in life²; to protect future generations of retirees from poverty, Government needs to act now. Reinvesting just a fraction of the money saved by increasing the state pension age can help more people stay in work longer and support those for whom that is simply not feasible.”

“We know people worry that health issues, caring responsibilities and having the right skills will prevent them from working for longer – so it’s clear that raising the state pension age without a plan to help people earn or save more is a recipe for disaster.  Living longer is one of the greatest gifts of the 21st century, but it’s one the UK really needs to plan for.”

Based on its findings, Phoenix Insights recommends a package of support measures that includes:

• An engagement campaign to target those who will be affected first by any change
• Greater investment in tailored job support and preventative workplace health programmes, and support for working carers for people during the five years before the new state pension age
• A programme of support from mid-life onwards, including mid-life MOTs, age-inclusive campaigns, access to lifelong learning and preventative health at work programmes.

The last state pension age rise enabled approximately £4.9bn of savings. Assuming a similar saving would be made by the next increase, a reinvestment of 10-20%, or £0.5bn-£1bn, would still enable a net gain for the Exchequer of 80-90%, or £3.9bn-£4.4bn, in savings.

Elsewhere in the report, it details how despite 84% of people believing that providing the State Pension is an essential role for government, one in three (34%) think that there probably won’t be a State Pension by the time they retire, including half of 18-24s (49%) and over half of 25-49 year olds (53%).

Phoenix Insights was set up in 2021 by the UK's largest long-term savings and retirement business Phoenix Group, with a mission to address the possibilities and challenges that come from longer lives. As well as calling for direct support to cushion the impact on individuals most impacted by a state pension age rise, it is asking for public funding to be directed towards supporting opportunities for better, longer and healthier working lives for all ages.

The report also shows:

• The public’s considers health (65%), individual circumstances (64%) and ability to do the job (61%) factors that should determine when a person stops working
• 76% of people support the idea of early access to the state pension for people who are unable to continue to work, for example due to health reasons
• 69% of people believe that the Government should 'top-up' the incomes of low-income pensioners, to make sure that they have a reasonable standard of living
• Conservative voters (61%) were more likely than Labour voters (56%) to agree that with people living longer, we should be prepared to pay more taxes to properly fund state pensions.

The full report and recommendations can be found here.

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Notes to editors:

About Reaching a certain age: Public attitudes to the state pension methodology

• Reaching a certain age: Public attitudes to the state pension was commissioned by Phoenix Insights; a longevity think tank with a mission to transform the way society responds to the possibilities of longer lives. The findings will be used to develop new ideas, policies and actions that government and the business community can use.
• Phoenix Insights is part of the UK’s largest long-term savings and retirement business, Phoenix Group, and is chaired by its CEO Andy Briggs, who is also the Government’s Business Champion for Older Workers.
• Polling for the report was conducted by YouGov. Total sample size was 2,003 adults. Fieldwork undertaken online 21st-22nd April 2022. The figures have been weighted and are representative of GB adults (aged 18+).
• In the Autumn, Phoenix Insights will be engaging members of the public to reimagine how the state pension could change to ensure it is fit for purpose in the twenty-first century, through two large deliberative workshops in partnership with The Policy Institute at Kings. This will support Phoenix Insights’ policy work around the review of the state pension age, provide public engagement in shaping future work in this area, and help increase debate on the role of the state pension in ensuring financial security for better longer lives.

About Phoenix Insights

People are living for longer. But longer lives are not yet always better lives. We want to change this. Phoenix Insights is a new think tank set up by Phoenix Group to transform the way society responds to the possibilities of longer lives. We will use research to lead fresh debate, prompt a national conversation, and inspire the action needed to make better longer lives a reality for all of us. The core of our work will look at financial security, work, and learning and skills, but we will also look at health and care, and homes and communities. Reimagining longer lives means making changes in all these areas. Some of our work will focus on the experiences of specific groups who face significant challenges. We also want to ensure that the ideas and solutions we advocate for contribute to a sustainable future for people and the planet. At the heart of all our work, we are committed to reducing inequalities and building a society that enables all of us, not just the fortunate few, to live better longer lives.

Phoenix Insights is led by Catherine Foot, a leading research and policy specialist in longevity and ageing who was appointed as the Director of Phoenix Insights in June 2021. Catherine has over 20 years of experience in the field. From 2015 to 2021, she was Director of Evidence at the Centre for Ageing Better. She has also held senior roles with The King’s Fund and Cancer Research UK. Catherine holds degrees from University of Cambridge and University College London.

The think tank is supported by an expert advisory committee including Baroness Camilla Cavendish, Rt Hon Amber Rudd, Lord Victor Adebowale, Professor Lynda Gratton, Professor Sarah Harper CBE and Baroness Ruby McGregor-Smith CBE.

¹ IFS, 2022
² Longevity inequality - Briefing Note Number 125, Pensions Policy Institute, 2020