The cost of changing women's state pension age: have women born in the 1950s been short-changed?

20 February 2019
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In 1995, the government announced plans to increase women’s state pension age from 60 to 65 in line with men’s. As a result, many women in their early 60s now are facing financial hardship. We hear from the campaigners seeking redress

Valda Marks, 64, was devastated when she discovered the state pension age had risen.

Just before her 60th birthday, she asked for a state pension forecast but, to her horror, found out she would have to wait another five years before she could claim.

“I felt absolutely robbed when I found out about the age change. I was looking forward to a comfortable retirement, but when you find out you are not getting a pension it can be quite difficult,” Valda says.

Valda, who lives with her husband in Suffolk, says the decision to raise the state pension age has cost her £44,000 and that, as a result, they have had to sell their home and rent.

“Our house is now our pension fund. We could have stayed but we would have had very little income. Without selling it, we would have found it more difficult but we should not have had to do it.”

After leaving school, Valda started working in the unemployment benefit office and then became a self-employed bookkeeper.

“I felt robbed when I found out about the age change”

She adds: “After I turned 60, I had to carry on working because of the pension changes but, last year, I had to go down to two days a week for health reasons. I work part-time as a bookkeeper, but this will be ending soon and I will have to look for a new job, which will be a worry.”

Like millions of women in their early 60s, Valda has had her dreams of a relaxing retirement crushed by the government.

Having experienced a lifetime of inequality, women entering retirement are finding they are even getting a raw deal when it comes to pensions. Changes to the state pension have left millions of women born in the 1950s poorer, with many now having to wait up to a further six years before they can claim.

Some, who have worked for decades and were expecting to retire have found they are now years away from receiving a state pension.

Many of these women are also unable to work because of poor health. Some are having to claim universal credit and have been forced to use food banks, while others, like Valda, have even had to sell their homes.

Changes to state pension age

The Pensions Act 1995 increased the state pension age for women, bringing the qualifying age in line with men by 2020.

The government then decided to accelerate its plan to increase the state pension age in 2011, so that men and women were on an equal footing by 2018. Women who thought they would receive a state pension at 60 suddenly found out they would not get it until they were 66.

The state pension age for women was raised last November to 65 – the same as men – for the first time.

It has been steadily rising from 60 since 2011 and in 2020 the age for both sexes will rise to 66.

This means that 3.8 million women born in the 1950s (on or after 6 April 1951) who thought they would be able to retire at 60 have had to wait another five or six years.

However, the increase in the state pension age has drawn widespread criticism.

Campaign groups such as BackTo60 and Women Against State Pension Inequality (Waspi) argue that many women born in the 1950s were not warned of the changes and have suffered financial hardship as a result.

While the government insists it did enough to notify affected women of the changes, many disagree.

Debbie de Spon, a spokesperson for Waspi, says: “Women who have worked hard all their lives and thought they would be retiring at 60 are suddenly finding out they can’t work and are having to live off the money they saved for retirement.”

Ms de Spon says that some women who stop work can struggle to return to the workplace.

She says: “Many women often give up work to look after elderly parents or sick partners and then find they have to return to work to finance themselves. Entry back into work for women in their late 50s and early 60s is not easy. Despite legislation, older women still face discrimination in the workplace.”

Fighting back

While the increase in women’s state pension age has been debated in parliament on a number of occasions, the government has refused to budge.

Last year, work and pensions secretary Amber Rudd said the government would make “no further changes to the law on this issue”.

However, women hit by the changes to the state pension age are refusing to be silent on the issue and are fighting back.

Waspi was set up in 2015 to campaign for compensation for women affected by the state pension age change.

Since its launch, thousands of women have taken part in rallies across the country and last year they marched at Westminster.

While Waspi agrees with equalisation of the state pension age with men, it is unhappy with the way it has been implemented.

The group is calling for a bridging pension to help women born in the 1950s, with compensation for those women who have reached state pension age and lost out.

Ms de Spon says: “Equalising the state pension age does not give women born in the 1950s equality. The government needs to do more. There are women claiming benefits each week when they thought they were going to be on the state pension. There needs to be some kind of compensation for all women who were not given adequate notice and time to make new arrangements.”

The decision to raise the state pension is now set to be fought in the High Court.

BackTo60, which claims to have 738,000 supporters, has won the right to judicial review to determine whether recent increases to women’s state pension age were lawful.

This case will be heard this summer, and the campaign group is hoping the government will reverse its decision.

The group is calling for the state pension age to be kept at 60 for women born in the 1950s, but the government has ruled out this idea as it would cost more than £70 billion.

Patrick Connolly, a chartered financial planner at Chase de Vere, says: “Based on everything the government has said so far, it seems unlikely that it will revise its plans for the state pension age, although it would be good to see the government making some steps to help those people who need it most.”

Valda is equally pessimistic.

She says: “I would like to see my pension backdated, but it is not going to happen. The government can’t afford to do it for all of us as the money isn’t there.

“I wouldn’t have minded if it had phased in fairly, but I had no notice whatsoever. The government made a mistake and we should be compensated.”

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Members of Waspi (Women Against State Pension Inequality) protest outside parliament

Why is there a pension gender gap?

Millions of women experience a gender pension gap and face poverty in retirement because of low pay and taking career breaks to raise children.

A recent report from Fidelity International suggests a 25- to 34-year-old woman’s pension would be worth £126,784 at the state pension age of 68, compared to £142,836 for men – a gender pension gap of over 10%.

One of the main reasons why women face a pension shortfall is that men earn, on average, more than women during their careers, so they contribute more to their pension.

To qualify for the full state pension you need a total of 35 qualifying years of national insurance contributions or credits (NICs).

However, as women take time out from work to raise children or become carers, they are more likely to have gaps in their NICs. Taking time out means women have lower lifetime earnings and end up with smaller workplace pensions.

Women who work part-time are also being penalised. If they earn below £6,032, they will not receive NICs for their state pension.

The Trades Union Congress (TUC) estimates that as many as three million part-time women workers are excluded from workplace pensions because they do not meet the minimum earning criteria.

Employers must enrol staff earning above £10,000 into a pension as part of auto-enrolment rules. However, as many women work part-time and do not earn this much, they don’t qualify for automatic pension contributions.

Divorced women can also miss out on pension money. During a divorce, pension assets often get left out of settlements, leaving women worse off in later life.

Mr Connolly says the best approach to retirement is to start saving early.

“While part-time workers may not earn enough for auto-enrolment, that does not mean they can’t have a pension. Their employer can still pay into a pension for them.

“Maternity rules have also improved over time. so women who have children can still pay in, although you need the finances to do this.”

Mr Connolly adds: “While women are still getting short-changed in many cases, we do now have a culture where many doing the same careers as men and are getting better opportunities, so over time you would expect the gap to close.”

Have you been affected by the state pension age changes for women? We'd like to hear your story. Please email editorial@moneywise.co.uk

In reply to by Contax (not verified)

Thank you for asking my opinion but being a woman of a certain age I am too busy going out to work to have time to do the Govt's job for them. But what it's worth, I would bring forward some public spending, as an unknown number of women would take their state pension early. This would increase public sector net borrowing in the short term in return for a longer term reduction. The total fiscal impact would not be known until all the relevant pensions ceased to be paid. For goodness sake, enough public money is being squandered on projects ranging from Crossrail to HS2 to the emergency response tel no project. Millions is also being spent by Councils on minor asylum seekers who are descending on these shores. I could go on but the point is, money is there but the political will is not. Things might change come a General Election. Lowering the retirement age would be popular with men, women, young and old.

In reply to by anonymous_stub (not verified)

1995 conservative prime minister, 2011 conservative prime minister, 2019 conservative prime minister. Everyone of these so called leaders of UK has pensioners blood on their hands. The 1950's generations mother's and father's had to go through hell after World War 11. So did the women born then did, making ends meet so that when their children where born in the UK they would have a better life. So for all the effort the women born in the 1950's, have put in, they been hammered by the clowns of Westminster. Johnson Major, David Cameron and Confused Theresa May, please hang your heads in shame.

In reply to by anonymous_stub (not verified)

Something for you at money wise to reply to please.Stories like the one here keep being published. Have you ever looked at the background of most of your subjects? To me obviously not . They plead poverty when ( as in the case of this woman) they live in Cyprus whilst having the cash to also go to New Zealand .Then there is the claim that 3.7 million women have been robbed, are destitute and more. Are they ?Come on Money Wise it’s about time you added some balance to this subject.

In reply to by Paul (not verified)

But not the acceleration in 2011! Most women, including me, thought after the 1995 decision they would recieve their pension at 62. This generation of women have never had equality with men. I remember a company director informing me the reason I was paid a lot less than my male counterpart was because I was married and my husband was the breadwinner, the year 1990.

In reply to by anonymous_stub (not verified)

I turned 60 in 2018. I have never(even as I write this) been informed officially that my pension age has risen to 66 years old, I heard about it via the media about 3 years ago. I had never heard about it before then, why, I have no clue as I do read newspapers. Anyway, I have had a 'double wammy' regarding my pension as way back in the 70's I was married and paying the womans national insurance stamp, the 'powers that be' at that time, persuaded women to pay full stamp on the premise their pension would be affected if they did not. We increased our NI contributions, and now we find our pension has been affected again. This has all had such a detrimental affect on my financial planning, We should have been officially notified long enough ago so that we could have made provision/adjusted our finances accordingly.

In reply to by anonymous_stub (not verified)

Its not just women born in 50s. I was born in 60s and got to work longer although i worked all my life towards the original age of 60. Also the age gap of 8 yrs between my husband and i means the years we get to spend together in retirement has lessened as ive got to work longer. Also now the pension credit system is changing meaning that although he worked from age 15 he cant claim any credit until i reach retirement age. Wheres the fairness in that? Its not just those from the 50s and its not all about money.

In reply to by anonymous_stub (not verified)

To add insult to injury. A year before I got my state pension the Chancellor announced he was increasing the amount you could earn before paying tax. As I was earning less than that it meant I no longer had to pay any tax. However, when I got my state pension the following year I was told it was taxable. I now have to pay tax on my pension. How is that fair?

In reply to by anonymous_stub (not verified)

I think you will find that the qualifying years for a full state pension no longer apply .I retired at 60 with 43 qualifying years of contributions. I will have to pay contributions for each year until I get to state pension age -66 . If I don’t find this contribution I willhave1/35 of my pension deducted each year from age 60 .

In reply to by anonymous_stub (not verified)

My wife born in 1955 has also lost her pension worked from the age of 16 forced to leave work in her fifties due to Cancer now terminal she will never get any of the pension she has paid in for all her life .

In reply to by anonymous_stub (not verified)

Unfortunately even if women were notified I bet it wasn't when they were in the 30s and they maybe had a better chance of making alternative arrangements.

In reply to by anonymous_stub (not verified)

I was born in 1955.i didn't get any letter from DWP telling me about the changes.i found out on FACEBOOK. Now I'll be 64 this year.i think yer not long really. Then this horrible government has now said I can't get my pension untill my husband gets his.My husband is 13 years younger than me.so I'll be about 82!!!!! And with my bad health I will probably be dead.so that's another one the government hasn't got to worry about.I am so upset about this.so in order to get a pension when I'm 66 I have to divorce my husband..no bloody chance.The sooner these evil people are out of parliament the better.Please can we have a general election.but I suspect they will get voted back in.There must be more 50s women who are in the same situation.I'm tired I'm really tired.

In reply to by anonymous_stub (not verified)

This gross injustice for women is discriminatory. My husband is now 65 but I have to wait until I m 66 years old!! How can that be equality? What about our human rights. I and many like me are suffering I'll health due to the stress.. Ive worked hard and brought my son's up, cared for my elderly mother now deceased. My expectation was that at 60 years old I would receive my pension. I get no bus pass either!! I suffered a heart attack at Christmas and my husband has reduced his hours at work to look after me... Why oh why have the women of this country been yet again punished through no fault of their own but to be born on a set date where a line has been drawn? Something must be done to compensate all of the women robbed of their right to their money not to be left penniless to pay for shortfalls in other areas.. complete injustice, this is money we be all paid in over the years to provide for such a time as now. Women are dying before they get their rightful pension. The statement that money is needed because people are living longer is a complete farce..

In reply to by anonymous_stub (not verified)

Women born in the 1950/60s have been particularly hard hit by the age rises. Are the rises just part of the dismantlement of the Welfare State? Whatever, women like me have had 7 years added to my expected retirement age of 60 with very little notice. This is despite starting work at 16 so having a potential 51 years of paying tax and NI. And of course there were no such things as equal pay in the 1970s. The ages need to be brought back down and maybe made the same for men and women or with a built in flexibility just in case women are still bearing children and having career breaks in the future!

In reply to by Geoff (not verified)

They were in their 30’s when notified. It was 1995.

In reply to by anonymous_stub (not verified)

You say 65 - I won't receive my state pension until I am 66!

In reply to by anonymous_stub (not verified)

How can I join any petition to add support for those who've lost out on state pension if born in the 50s?

In reply to by Stasia Cwenar (not verified)

Government pension theft

Pension reformers United group on facebook is where you need to be. And The Justice Party will be a party that puts the ni contribution paid by the taxpayer back to the taxpayer as their pension at age 64 for both. They will also ban outright tge sale of our NHS.

In reply to by anonymous_stub (not verified)

I am without my state pension. I did nothing wrong.We women, born in the 1950's, have had very raw deal from circumstances not of their doing.Governments made the decisions to keep men and women's pensions at variance, NOT women born in the 50's. Meanwhile, the current government saves around 5 billion a year!This us utterly unfair, to say the least and should be rectified.Surely the upcoming judicial review should see the absolute inequality in this. We are being discriminated against....no other way yo see it.

In reply to by anonymous_stub (not verified)

Anyone receiving state pension after April 2016 will get 30% more than before, I haven't heard any complaints about that.

In reply to by Maggie (not verified)

State pension

Yes Maggie you probably got yours before all this happend to us. It was the likes of us 50s women who paid for your pension. We've lost thousands. Nobody there to pay for ours there either on dole or in university. We didn't have a choice of staying at home to look after hubby and kids. Thanks for your support! !!!!

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