Pension age proposed to rise to 68

5.17.16pm GMT Wed 30th Nov 2005

The report from the Pensions Commission today announced proposals to raise the state pension age to 68 and to establish a National Pension Savings Scheme, which workers would be automatically enrolled into. The commission`s head Lord Turner said the UK`s pension system currently faced 'significant problems' and that state pensions should rise in line with earnings, not prices. The new national savings scheme will encourage all people to save for a pension at low cost.

David Laws MP, Shadow Secretary for Work and Pensions "We agree with Lord Turner that the problems in our pension system will grow increasingly worse unless a new pension`s settlement for the 21st century is now debated, agreed, and put in place. The choice now is between an affordable but unsustainable means tested system favoured by Gordon Brown, and an affordable and sustainable system as proposed by Lord Turner. We must now have an assurance that the chancellor will not be allowed to single-handedly veto the emerging consensus for reform."

During today's Prime Minister`s Questions, Charles Kennedy challenged the Prime Minister to "give the House this commitment today- that he will legislate following Lord Turner`s proposals, and that he as Prime Minister will see those reforms through?" The Prime Minister would not answer this direct question.

Mr Kennedy's question was "Mr Speaker, given that there is undoubtedly broad agreement with Lord Turner that the present system of means testing, muddled and inadequate state pensions cannot be maintained, if the Chancellor is not to exercise a veto on the direction in which Lord Turner wants to go, can the Prime Minister give the House this commitment today- that he will legislate following Lord Turner`s proposals, and that he as Prime Minister will see those reforms through?"