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Pensions will soar as people live longer

By Nicky Burridge

The UK is facing a dramatic rise in pensioners as a record number of people turn 65 in 2012, the Government has said.

More than 800,000 people will celebrate their 65th birthday during the year — 150,000 more than in 2011, according to the Department for Work and Pensions.

The massive increase, which stems back to the post-war spike in births in 1946 and 1947, will lead to a significant rise in Government spending on state pensions.

Government spending on people of state pension age has already soared by nearly £14bn since the first of the baby boomers started to draw their state pension at the age of 60 in 2005/06.

It is expected to have increased by nearly another £4bn by 2012.

The number of people of state pension age is set to continue rising, despite moves to raise the age at which women can claim their pension from 60 to 65.

By 2030 it is estimated that there will be 5.2m more people aged over 65 than there are today.

The Government is currently considering bringing forward planned increases to the state pension age to 66, which had been due to be phased in between 2024 and 2026. It also wants to phase out the default retirement age to ensure those who want to work for longer can do so.

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