One in four Britons may live to be 100, the Office for National Statistics estimates, meaning as many as 11 million people alive today can expect to receive royal birthday congratulations. We have been here before – the Department for Work and Pensions released similar estimates last Christmas. Why? Possibly to improve the demographic intelligence of the nation, more likely to provide statistical cover for steep increases in state pension ages.
Both Labour and the coalition government decided to increase the age at which men and women can draw the state pension. Women's pension age will increase to 65 by November 2018, while the age for both men and women will then rise to 66 by April 2020. The coalition is seeking a further rise to 68.
The official scenario assumes a pain-free adjustment to later pensions, smoothed by a labour market that enables sprightly late sixtysomethings to carry on working. Yet the trouble with all generalisations is that they are simply that. Social class rears its ugly and unequal head. The chances of a man from social class 7 dying before the age of 65 is almost one in five (19%), compared with just 7% of those from social class 1. Social class 7 covers "routine occupations", for example labourers, van drivers, packers and cleaners. For women the figures, this time for dying before 60, are 10% in class 7 and 4% in class 1.
There is a further penalty paid by those from poorer backgrounds as they experience shorter "pension lives" than the better-off. Professional men reaching 65 years have a life expectancy of 18 years, unskilled men have just 14 years. (For women at 65, the figures are 22 years and 17.7 years.)
A further reality check is the actual experience of employment around the state pension age. Raising pension ages assumes that men and women in future years will be able to work for an extra period. How reasonable is that assumption?
So, what happens now? Some men and women do continue to work past state pension age (about 13%). But a far higher proportion are effectively out of the labour market before the formal state pension age. Labour force survey data shows that almost a quarter of men aged 50-64 and more than a quarter of women aged 50-59 were classed as "economically inactive". So for men aged 62, 39% are not working; by age 64, 52% are not working. For women aged 58, 36% are not working.
What are the policy implications of this? This analysis does not challenge the overall strategy of raising pension ages over time. However, we need to build in some sensitivity to social class variables. Such a sensitivity is absent from macho commentators, usually from privileged backgrounds, who recommend higher and higher pension ages – 66? 68? Why not 70? Those in big businesses, the media and politics may well be able to work late into life. But manual workers with creaking backs and aching limbs do not attract consultancies or company directorships, write articles or go to the House of Lords.
Social class variations in mortality relate to a significant difference in patterns of working life. The poorest in our community coming up to pension age over the next 10 or so years often started their working lives at the age of 15 or 16. Many have been working ever since. By contrast, a majority of those from the higher social classes, not least due to the benefit of university education, did not start their careers until the age of 21, or perhaps, given postgraduate qualifications, several years later.
As pension ages increase we should have an early pension entitlement at 65 for those who started work in their mid-teens and have contributed towards their pension for almost 50 years. If this group was able to claim a pension three or four years earlier than those from better-off backgrounds this would only be just, given that on current evidence many of them die three or four years earlier than others.
