Belfast Telegraph

Saturday 19 April 2014

Gloom over pensions shake-up

On a day of rainstorms and gale force winds, the Chancellor George Osborne added to the gloom by essentially telling young people that they may have to keep working for the rest of their lives because of the growing cost of the state pension. It is a chilling thought to realise that someone born today will be 77 before they can lift a state pension.

We all know that the generous final salary pensions offered by many employers in the past are now being phased out faster than snow thawing at the equator.

Staff cannot even rely on employers making a significant contribution to the replacement pensions. Only politicians and civil servants, it seems, can look forward to retirement with any optimism.

With people living longer, how will the state fund future pensions, even if politicians keep deferring the date at which it can be claimed?

Will the young in work be taxed even more heavily to fund the reverse pyramid of population, top heavy with the silver-haired generation?

That would be politically dangerous and morally unfair.

Young people are already being burdened with large debts to pay for their tuition fees and have to defer their own life choices, such as buying a home or getting married, until they feel more financially secure.

The Chancellor may think that making people wait longer and longer for their state pension is one answer to the growing cost, but keeping older people working longer will only create a bottleneck with younger people unable to find a job.

That would be a self-defeating policy as the state would lose valuable tax revenue by preventing the coming generation moving along their career ladders.

It is clear that the whole issue of pensions needs to be examined carefully and not just subjected to party policy or expedient whim.

The halcyon days when men could look forward to retirement at 65 and women at 60 are now well and truly over, to be replaced by increasing demands from the state with no guarantee of ever getting a return.

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