Government refuses to back down over raising pension age of women

WORK and Pensions Secretary Iain Duncan Smith last night defied the threat of a backbench rebellion and refused to back down on raising the retirement age of women.

Instead the government pressed ahead with the reform, which will see the retirement age of men and women levelled at 66 in 2020 - two years earlier than expected for women.

Back-benchers, including the deputy leader of the Scottish Liberal Democrats and East Dunbartonshire MP Jo Swinson and Scottish Tory James Gray, had urged the government to think again, along with the Labour benches.

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Ministers were warned that the move discriminates against women in their late-50s, who will now have to wait longer than they had expected to receive their pensions. It is understood to affect 300,000 women who have retired early.

But Mr Duncan Smith insisted that it would only affect a "relatively small number of women" and that delay would cost the taxpayer 10 billion. He offered to hold discussions with MPs over the "transitional arrangements", but added: "We stand by the need for men and women's state pension ages to equalise in 2018.

"And both will rise together so the state pension age reaches 66 in 2020. This bill will go forward on that basis. If we delayed the move to 66 until 2022 it would cost the taxpayer 10bn - an unfair financial burden borne disproportionately by the next generation."

He was opening a debate on the legislation in the Commons ahead of a vote last night when Prime Minister David Cameron and Deputy Prime Minister Nick Clegg were braced for a rebellion involving both Tory and Liberal Democrat back-benchers.

The Pensions Bill will see the state pension age for women go up from 60 to 65 in 2018 - two years earlier than planned under Labour - and rising to 66 in 2020.

Ahead of the debate Ros Altmann, the director general of Saga and a former government adviser on pensions, warned that ministers could face a costly legal challenge if they did not change.

"Ministers must listen to reason on this issue. The current plans are unfair and may, indeed, be illegal in public law terms, since they clearly do not give women adequate notice of the large changes in pension age that they face," she said.

Labour leader Ed Miliband said the move "punishes the daughters, mums and grans who took time out to look after families".

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Mr Cameron defended the move to equalise the retirement age and insisted there was no prospect of a climbdown over changes to public sector pensions.

He said: "There is no question of climbing down. Obviously we have got to have a system that is long-term affordable for the taxpayer, but also I want a system where people in the public sector feel they are getting a good pension."