The state pension remains a central pillar of retirement income in the UK, yet it is entirely uncertain – particularly for younger people – what they should expect to receive from the state in later life, or when they will receive it.
While little has changed in pension policy over the past decade, eye-watering projections for the cost of state provision as the population ages mean the debate has continued to rage.
The total annual cost of funding state pensions today is in the region of £150bn, with the Office for Budget Responsibility (OBR) warning that, without policy change, the cost of this provision will rise from 5 per cent of GDP to around 9 per cent in 50 years’ time.
Shorts
To put that in context, NHS spending accounts for around 11 per cent. So, the state pension is already a major expense – and is on course to rival current levels of spending on healthcare.
