TUC slams 'pension postcode divide'

Frances O'Grady

A postcode divide in state pension entitlement will see some people receive £67,000 more over a lifetime because of huge difference in life expectancies across the UK, a new report has claimed.

A study by the TUC showed that women in their late 40s living in East Dorset - which has the longest post-65 life expectancy for men and women - can expect to live nine years longer than a woman in Corby, the area with the shortest female post-65 life expectancy, when they retire.
The union organisation worked out that the difference was worth £67,000 over a lifetime, while the divide for men living and East Dorset and Manchester (the area with the shortest male post-65 life expectancy) will be £53,000.

The state pension divide will grow for different types of workers, with managerial and professional employees living longer than manual workers, said the TUC.
General Secretary Frances O'Grady said: "The government's decision to accelerate the rise in the state pension age will mean millions of people having to work for longer in order to receive less in retirement.

"There is already a shocking divide in life expectancies across England, and if current trends continue that inequality will get worse in the coming decades. The Government's pension reforms will add to the problem, with people in richer areas receiving more from the state, while those in poorer areas receive less.

"It cannot be right that people living in a wealthy area can receive tens of thousands of pounds more in state pension than someone living in a less well-off part of the country, particularly as richer people are likely to have earned more during the career and have a bigger private pension too.

"The Government should abandon its plan to raise the state pension age in light of the new evidence on projected life expectancies. It should instead set up an independent commission to examine health inequalities and the impact on people's expected retirement incomes."

The TUC report, covering England, showed that millions of people will receive less state pension, despite having to work for a further two years, because their life expectancy is not keeping pace with the increasing state pension age.

People living in poor areas such as Corby, Manchester, Salford and Hull will receive substantially less state pension over their lifetime, said the report.

A Department for Work and Pensions spokesman said: "Life expectancy is rising across the whole of the UK and we need a sustainable state pension system.

"Future rises in the state pension age will be independently reviewed, taking in a range of relevant factors.

"These are expected to include variations in healthy life expectancy, variations between different socio-economic groups, regional variations, and wider economic considerations."

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