The Pensions Commission is due to issue a recommendation that employees should continue to work later in life but also claim a larger state pension.

Based on a report published by the Financial Times, Lord Adair Turner’s commission is expected to suggest that the claimant age for state pensions be raised rom 65 to 67 years old.

As a trade-off for working longer, the report will also recommend for a more serious pension package.

The commission is expected to recommend both an increase in individual saving, tax rises and extended retirement ages in order to avert a potential crisis. This will then be strengthened by a larger pension package.

The changes are expected to be implemented on a staggered basis, and will begin after 2020 when women’s claimant age will more be at par with men at 65. The increases will then peak at 2050, by this time pension payouts will top out at £109 per week. The current basic state pension pays out £80 a week.

The plans are expected to affect those who are currently under the age of 50.

The commission also revealed that almost 9 million people are not seriously saving money in time for their retirement. Thus, to encourage savings, they will also call for a new national pensions savings scheme where individuals will be enrolled automatically. Workers, however, have a choice if they want to enter the plan or not.

Company formation and business solutions experts hope that these new initiatives will be able to uplift workers’ welfare without necessarily affecting business owners who will also be affected by the proposed measures.

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