More than a million women £32 a week poorer due to state pension rise - IFS
More than a million women are £32 a week worse off with many pushed into income poverty under the latest rise in the state pension age, an independent thinktank has said.
The Government's decision to hike the female retirement age from 60 to 63 - a change brought in between 2010 and 2016 - has placed a “further pressure on household budgets,” the Institute for Fiscal Studies said.
The change is part of government efforts to bring the state pension age for women in line with that of men by 2018.
The Waspi campaign against womens’ pension rises said the hiking of the state pension age had "devastating consequences for the women affected".
But the Government insisted the changes to the state pension age were "fair and sustainable".
According to a new report by the IFS some 1.1 million fewer women are receiving a state pension as a result of the changes - while the Treasury has already seen an income boost of £5.1bn a year.
Households have seen an average £74 a week reduction in pensions and other state benefits, although some of that has been offset by women staying in work longer.
It means income poverty among 60-62 year-old women has shot up by 6.4 percentage points from its 2010 level of 14.8%.
The IFS said it had seen no change in material deprivation among families, but noted that the £32 a week average loss was hitting the poorest households the hardest.
Jonathan Cribb - a senior research economist at the IFS - said: “The tax and benefit system is much more generous to those above the state pension age than those below it.
“So while increasing the state pension age is a coherent response to the public finance challenge posed by rising longevity it does place a further pressure on household budgets.”
He added: “The increased state pension age is boosting employment – and therefore earnings – of affected women but this is only partially offsetting reduced incomes from state pensions and other benefits."
Jane Cowley, director of the Waspi campaign, said: "Whether it is the 3.5 million WASPI women who were not given sufficient warning of rises to their state pension age, or the sharp rise in income poverty among 60 to 62-year-old women, the Government needs to sit up and start realising that its changes have devastating consequences on the women affected.
"Yet again, it is women who are paying the price for the Government’s pension reforms. This simply isn’t good enough when the UK already has one of the biggest pension pay gaps in Europe.”
But a spokesperson for the Department for Work and Pensions said: “The decision to equalise and increase the State Pension age is both fair and sustainable for future generations and in line with continuing rises in life expectancy.
“Women retiring today can still expect to receive the State Pension for over 24.5 years on average – which is more than any generation before them and several years longer than men.
“By 2030, more than three million women stand to gain an average of £550 extra per year as a result of the new State Pension.”