Pensions mistakes of the past must be avoided, says John Cridland

Mistakes of the past must be avoided when telling people of any rise in their state pension age, the author of a major review has told the government.

John Cridland published the independent review on Thursday, proposing that those under the age of 45 may have to work a year longer, to 68.

He told BBC Radio 4's Money Box that there should be no repeat of the issues currently facing women in their 50s.

Many say they were not told directly of two rises in their state pension age.

Their campaign, known as Waspi - Women Against State Pension Inequality - argues that poor communication meant many were surprised to discover they had to work for longer.

The Cridland report, one of two published earlier in the week addressing the future of the state pension, examines the cost of increased longevity to the state pension.

Affordable?

In the report, Mr Cridland, the former boss of the Confederation of British Industry, said that the long-term future of the "triple-lock" needed to be considered. The triple-lock promises that the state pension will rise in line with average earnings, prices or 2.5%, whichever is highest.

"There will come a time in the future when that needs to move to earnings," he told Money Box.

"It won't be done in this parliament. Government has a choice of when it moves it. By the 2060s, almost 1% of GDP will be spent on the state pension in addition because of the triple lock.

"It has done a lot of good but it costs £20bn a year and in the long run it may not be affordable."

He added that the Winter Fuel Payment, a universal benefit of between £100 and £300 tax-free to help pay heating bills, may need to be means-tested in the future.

"There are those of us who wouldn't be pushed into cold winters if we didn't have a winter fuel allowance and there are people for whom the winter fuel allowance is the only thing that keeps the heating on. There may come a time when we need to target it rather than have it as a universal benefit."

One thing Mr Cridland examined, but did not recommend, was variable state pension ages, which would allow some people to retire earlier.

'A chance to plan'

He also insisted that in the long term employers' attitudes to taking on workers aged in their late 50s and 60s would need to change.

"I've suggested statutory carer's leave so that somebody who is trying to work while looking after an aged parent can't be told off by their employer when they don't turn up for work because their mum's slipped in the shower.

"I say that every employer should have an elder care policy so that they can demonstrate what they're doing to help their older workers cope with the fact that many people aged 63 will be looking after their aged parent who's 93.

"I do think in 20 years time the aging society will be the dominant thing that's being talked about by politicians. We have the chance now to plan for that future."

Listen to the full interview on Money Box on Radio 4 on Saturday at 12:00 GMT