Labour’s pledge to cap pension age rise at 66 would cost £250bn

LABOUR’s plan to cap increases in the state pension age will leave taxpayers with a bill of £250billion, a minister claimed last night.

work and Pensions secretary David Gauke said the opposition were being ‘disingenuous’ with their policy to keep the retirement age at 66.

He said the cost of the policy would be £250billion by 2045 – but Labour has not said how it would be paid for.

Last week Mr Gauke announced that the retirement age would rise earlier than expected, leaving six million people in their forties having to work an extra year.

The pension age will rise from 67 to 68 between 2037 and 2039, not starting in 2044 as expected. The move affects anyone born between April 6, 1970 and April 5, 1978.

After Labour opposed the move, Mr Gauke wrote to its pensions spokesman, Debbie Abrahams, urging her to say how its policy would be paid for.

He said the commitment will mean either higher taxes ‘over and above the ... rises you have already committed to’, more debt for future generations or cutting spending on public services.

Comparing the pledge to Jeremy Corbyn’s promises on student debt, he said: ‘Labour have abandoned your pre-elec- tion commitment to remove student debt from over five million people because it is unaffordable.

‘Unless you are able to specify the different choices you would make to cover this £250billion extra spending, it will be clear that your position on pensions is just another disingenuous promise to the British people that you cannot deliver.’

Labour has said that raising the pension age will cost millions of workers almost £10,000 each.

Research by the House of Commons Library shows the increase will save £74billion. This is equivalent to an average ‘ loss’ for the 7.6million people affected of around £9,800 per person.

Miss Abrahams said: ‘This is a disgraceful and unjustified attack on the state pension by this Government, who are asking millions of people to work longer to pay for their failing austerity plans.

‘Labour want to take a measured approach, leaving the state pension age at 66 while we review the evidence emerging around life expectancy and healthy life expectancy, considering how we can best protect those doing demanding jobs.’