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State pension age could rise to 80 unless major government reform made, expert warns

by Karl Matchett
September 17, 2025
in Finance
Reading Time: 4 mins read
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An trade professional has warned that the state pension age could must rise to 80 with out dramatic reforms, amid issues the nationwide invoice can be “fully unaffordable” as life expectancy will increase.

The UK’s state pension age is ready to extend from 66 to 67 between 2026 and 2028. There’s a additional improve to 68 lined up for 2046 however that is extensively anticipated to be introduced ahead considerably, with a wider pensions overview underway.

Nonetheless, the annual value of the state pension is rising and persons are residing longer – that means larger pension payments for longer. The most recent report from the Workplace for Finances Accountability (OBR) recommended the associated fee might be £200bn a 12 months by 2073.

The upshot is that both the triple lock must go or individuals must contribute much more to it throughout their working lives, with estimates saying the state pension will value 7.7-8.4 per cent of GDP by the 2070s.

Jack Carmichael, a pensions professional and actuary at Barnett Waddingham, warns that may’t be paid for in present phrases, and may even be undershooting the fact by then, too.

“A extra cautious strategy can be to imagine a closing of the life expectancy hole between the people with the bottom and highest life expectancy. Below this various, the annual value of the state pension would improve by round £8bn a 12 months – 4 occasions larger than the OBR’s central projection,” Mr Carmichael advised the Telegraph.

“Preserving the associated fee at an analogous proportion of GDP would then require an enormous improve within the state pension age, probably as much as the dizzying heights of 80.

“Even when the central projection is right and state pension spending hits 7.7pc of GDP, the associated fee continues to be going to extend by nearly half in right now’s phrases. That’s fully unaffordable. Staff are both going to should contribute 50pc extra to the state pension or [the government is] going to have to vary the system not directly.”

Different consultants have mentioned the pensions system might be bringing in lower than it pays out in as little as a decade.

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Meaning this authorities – or not less than its overview – might need to behave now regardless of the clear unpopularity of doing so.

“This newest state pension age overview, nonetheless, could ultimately power the federal government’s hand,” mentioned Rachel Vahey, head of public coverage at AJ Bell.

“State pension advantages are one of many single greatest bills for the Treasury and account for greater than 80 per cent of the £175bn pensioner welfare invoice. With out coverage intervention, state pension prices are set to spiral to almost 8 per cent of GDP over the subsequent 50 years based mostly on the present trajectory, up from 5.2 per cent right now.

“One choice is to boost the state pension age larger and sooner than at present deliberate. Though the elephant within the room is that state pension age is only one lever authorities has to assist handle the price of the state pension – the opposite is reforming the triple lock.”



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Tags: AgeexpertgovernmentmajorPensionreformRiseStateWarns
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