George Osborne’s autumn report disheartened generations of young workers on Thursday as he announced that the current pension system is unsustainable. People are living longer and so we need to work longer too.
This, added to high levels of debt caused by tuition fees and high youth unemployment, paints a murky collage for the young people in the UK. In Kingston 4.8 per cent of 18-24 year-olds are unemployed, which is double the overall average in the area. It seems that now when they find a job they may just have to hold on to it – for life.
This was one of the gloomier parts of Mr Osborne’s report and added to the message that there is still a long way to go.
“Our generation has been warned that the costs of providing decent state pensions are going to become more and more unaffordable unless we take further action,” he said.
“Let’s not leave it to our children to take emergency action to rescue the public finances; let’s think ahead and take responsible, sensible steps now.”
Plans to raise the state pension age have been accelerated so that by the mid 2030s 68 will be the new age of retirement, nearly a decade earlier than expected.
This means that people under 50 will be unable to claim their state pension until they are 68 so will lose thousands of pounds worth or retirement income. For those in their 20s it is likely that the age will rise even further, so that they won’t be able to collect a pension until they are 70.
For current pensioners the news was a little brighter as they were granted a £2.95 increase in the basic state pension, which will come into affect in April. This takes their weekly payment from £110.15 to £113.10.
Image curteousy of REX/Ray Tang