The increase in the pension age to 68 will mean a cut of nearly 10% in pension income over a person’s lifetime in retirement.
Even though the government is raising the pension it has not solved the problem of people being forced to retire at the age of 65 or earlier. People forced to retire but who cannot get a pension are being forced on to unemployment payments/Jobseeker’s Allowance, even though they have worked and paid taxes all their lives.
Being forced on to unemployment payments, rather than receive a pension, means a loss of nearly €2,400 a year (and up to €7,000 for a couple). This is a massive cut in living standards. And the budgetary gain? Marginal, at best. Increasing the pension age to 67 in 2021 will “save” the government approximately 0.2% of national income in pension payments. But this doesn’t include the cost of rising unemployment and related payments for those who have retired but have to wait for their pension.
It is difficult to understand the rationale for the government’s decision to increase the pension age.