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Tories plan rise in pension age Tories plan rise in pension age
(31 minutes later)
The Conservatives have announced plans to make millions of men now in their fifties work for an extra year before they receive their state pension.The Conservatives have announced plans to make millions of men now in their fifties work for an extra year before they receive their state pension.
Shadow chancellor George Osborne will raise the state pension age from 65 to 66 from 2016 if the Tories win the next election, to help tackle UK debts.Shadow chancellor George Osborne will raise the state pension age from 65 to 66 from 2016 if the Tories win the next election, to help tackle UK debts.
He has also not ruled out a rise in pension age for women towards 66.He has also not ruled out a rise in pension age for women towards 66.
The government has already announced plans to raise the state pension age to 66 but between 2024 and 2026.The government has already announced plans to raise the state pension age to 66 but between 2024 and 2026.
Bringing the move forward would mean many more people than previously expected, particularly those aged between 49 and 59, having to work a year longer before qualifying for a state pension.Bringing the move forward would mean many more people than previously expected, particularly those aged between 49 and 59, having to work a year longer before qualifying for a state pension.
Conservative Party sources say the change would save £13bn a year from the budget deficit, about 0.75% of GDP each year.Conservative Party sources say the change would save £13bn a year from the budget deficit, about 0.75% of GDP each year.
Long-term savingLong-term saving
Under the government's existing plans, the state pension age will rise gradually from 65 to 68 between 2024 to 2046.Under the government's existing plans, the state pension age will rise gradually from 65 to 68 between 2024 to 2046.
This was designed to help pay for restoring the link between pensions and earnings which both Labour and the Conservatives are committed to introducing before the end of the next Parliament.This was designed to help pay for restoring the link between pensions and earnings which both Labour and the Conservatives are committed to introducing before the end of the next Parliament.
Mr Osborne will announce the pension plan in a speech to his party in Manchester later.Mr Osborne will announce the pension plan in a speech to his party in Manchester later.
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The BBC's Rajini Vaidyanathan asks two people used to making cuts on a regular basis where public spending can be reducedThe BBC's Rajini Vaidyanathan asks two people used to making cuts on a regular basis where public spending can be reduced
Mr Osborne is expected to say the rise in the retirement age will be "how we can afford increasing the basic state pension for all".Mr Osborne is expected to say the rise in the retirement age will be "how we can afford increasing the basic state pension for all".
He will go on to describe it as "one of those trade-offs any honest government has to confront".He will go on to describe it as "one of those trade-offs any honest government has to confront".
The government is currently intending to equalise the state pension age for women, so that it rises from 60 to 65 from 2010 to 2020.The government is currently intending to equalise the state pension age for women, so that it rises from 60 to 65 from 2010 to 2020.
The Tories said how this would link into their new policy was "up for review" - but they did not rule out that women could see their pension age rise towards 66 from around 2016.The Tories said how this would link into their new policy was "up for review" - but they did not rule out that women could see their pension age rise towards 66 from around 2016.
Senior Tory sources said the change was designed to lock in a sustainable and long-term saving into the public finances.Senior Tory sources said the change was designed to lock in a sustainable and long-term saving into the public finances.
It is surprising that the Labour chancellor chose to make this announcement - which affects hundreds of thousands of people - in the middle of a Conservative Party conference Tory spokesman Stephanomics: An embarrassment of cutsIt is surprising that the Labour chancellor chose to make this announcement - which affects hundreds of thousands of people - in the middle of a Conservative Party conference Tory spokesman Stephanomics: An embarrassment of cuts
They acknowledged that the decision could prove unpopular with some but they said they were being deliberately upfront about a tough decision that would make credible savings in the long term.They acknowledged that the decision could prove unpopular with some but they said they were being deliberately upfront about a tough decision that would make credible savings in the long term.
Shadow secretary for work and pensions, Theresa May, told BBC Two's Newsnight that the UK's "ageing population" made it necessary to look "at what point it is appropriate for people to be receiving their state pension".Shadow secretary for work and pensions, Theresa May, told BBC Two's Newsnight that the UK's "ageing population" made it necessary to look "at what point it is appropriate for people to be receiving their state pension".
She added: "I'm afraid there are some tough choices to be made."She added: "I'm afraid there are some tough choices to be made."
'Surprising''Surprising'
Mr Osborne is under pressure to demonstrate that he has a fully-worked out plan to deal with Britain's record debts - and pay for some of the measures announced this week to deal with unemployment.Mr Osborne is under pressure to demonstrate that he has a fully-worked out plan to deal with Britain's record debts - and pay for some of the measures announced this week to deal with unemployment.
But his big speech looks in danger of being overshadowed by Chancellor Alistair Darling's announcement of a pay freeze for 750,000 senior and middle-ranking civil servants, sparking Tory anger.But his big speech looks in danger of being overshadowed by Chancellor Alistair Darling's announcement of a pay freeze for 750,000 senior and middle-ranking civil servants, sparking Tory anger.
A Tory spokesman said Mr Darling's announcement, on Monday evening, shows that "the Conservative Party is setting the terms of the political debate on the economy".A Tory spokesman said Mr Darling's announcement, on Monday evening, shows that "the Conservative Party is setting the terms of the political debate on the economy".
He added: "It is surprising that the Labour chancellor chose to make this announcement - which affects hundreds of thousands of people - in the middle of a Conservative Party conference.He added: "It is surprising that the Labour chancellor chose to make this announcement - which affects hundreds of thousands of people - in the middle of a Conservative Party conference.
"People will question his motives. Tomorrow (Tuesday) George Osborne will set out an overall approach to deal with Labour's debt crisis"."People will question his motives. Tomorrow (Tuesday) George Osborne will set out an overall approach to deal with Labour's debt crisis".
But Labour sources insisted they were not trying to scupper Mr Osborne's speech, saying public sector pay was simply the first issue in Mr Darling's in-tray after he returned from the Labour conference and a series of foreign engagements.But Labour sources insisted they were not trying to scupper Mr Osborne's speech, saying public sector pay was simply the first issue in Mr Darling's in-tray after he returned from the Labour conference and a series of foreign engagements.