Labour MP Andrew Lewin proposes a scheme where under-40s with 10+ years of National Insurance contributions receive £11,500 to delay retirement by a year. The policy faces criticism from experts who raise concerns about the feasibility and long-term implications of 'borrowing' from future pension funds.
Chancellor Rachel Reeves. The lump sum would be paid to those who agree to delay retirement by one year, for example from age 68 to 69 Andrew Lewin, the Labour MP for Welwyn Hatfield, is calling for a scheme where under-40s who have a decade of national insurance contributions are handed £11,500 in exchange for delaying retirement by a year.
“The core of the idea is not to increase spending, but to offer the choice to access this lump sum when you need it most.”Tom Selby, director of public policy at AJ Bell, it is an “utterly mad idea” that seems to be based on a fundamental misunderstanding of how the state pension works.He said: “The state pension is funded on a pay as you go basis, meaning taxes paid by younger people today are used to fund the incomes of retirees today.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, was also cautious about the idea. But Mr Lewin said if implemented it would reduce reliance on the “Bank of Mum and Dad” among younger people. Other experts said they could see the appeal of the idea but acknowledged it wouldn’t be without problems.
STATE PENSION RETIREMENT FINANCE LABOUR PARTY POLICY
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