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Last Updated: Sunday, 22 May, 2005, 14:50 GMT 15:50 UK
Two-tier pensions plan suggested
Adair Turner
Mr Turner said age expectancy had to be considered
Graduates might have to wait until they are 70 before drawing a state pension, the head of the government's Pension Commission has suggested.

But lower-paid workers could still retire on a full pension at 65, Adair Turner told the Sunday Times.

The variance would reflect the fact that professionals live five years longer than the unskilled, he said.

Former Labour pensions minister Frank Field has given his support, saying graduates should work longer.

Mr Turner is due to give his final report on pensions in the autumn. The government is to consult on the plans.

A university degree does not guarantee a retirement free from poverty
Gordon Lishman
Age Concern director general

Mr Turner, who is looking into the reform of the pensions system for the government, told the newspaper: "One of the sad facts is that, although life expectancy is going up, it is going up least in lower socio-economic groups.

"So we have to be sensitive to that when we put up the state pension age."

The former Confederation of British Industry chief said a person who worked from the age of 16 would be eligible for a pension at 65, but "the person who went to university and started serious work at 23 is not going to get it until 70."

"We've got to be wary of saying 'Well, in order to get our numbers to add up without a further tax increase it (the state pension age) has got to be 70 in 2030, end of story'," he said.

"It's too cavalier in relation to the life expectancy of people at the bottom."

'Degree no guarantee'

Mr Field said: "You can achieve his objective by saying there is X number of years that you have to contribute to the pension before you can draw it.

"So those that don't go on to university and go straight from school into work will clearly have got their contribution years completed before those of us who went on to university and started much later."

Older person's charity Age Concern said a complete overhaul of the pensions system was "critical" to avoid poverty in retirement.

Charity director general Gordon Lishman said Mr Turner's proposal to raise retirement age for graduates was an "interesting addition to the debate".

He added: "A university degree does not guarantee a retirement free from poverty and the government must ensure there is a full public debate before such major decisions are made."

Chancellor Gordon Brown dismissed the interview as "speculation" about the commission report - even though it is Mr Turner who will deliver it.
Changing the entitlement depending on whether you went to university would not only be wrong in principle but almost certainly unworkable
Malcolm Rifkind
Shadow Work and Pensions Secretary

Mr Brown stressed there was a need to build a consensus between politicians of all parties, business and employees if the commission recommended significant changes to the pensions system.

"Tony Blair and I said during the election campaign that if there were radical recommendations put forward there would have to be a period of consultation.

"We would have thought that if there were the sort of changes that some people have talked about that would require another period of consultation that may lead into the next Parliament."

Liberal Democrat pensions spokesman David Laws said: "The Chancellor appears in no hurry to dismantle the means-tested mess of a pension system introduced since 1997, forcing the country to endure the current crisis for some years to come.

"The Liberal Democrats are determined to play a positive role in finding a consensus on pensions policy, and Adair Turner's report is the obvious building block."

And Shadow Work and Pensions Secretary Sir Malcolm Rifkind cast doubt on the plans.

"Changing the entitlement depending on whether you went to university would not only be wrong in principle but almost certainly unworkable."

Your comments:

This is, quite frankly, complete and utter rubbish. They talk of life expectancy as though it is prices in a shop. It doesn't work like this. It can do anything it feels like. We could all die tomorrow. It will simply encourage people to not go to university and instead to let down Britain's economy. Why exactly did we vote in these people again? Is this what Britain is coming to?
Philippa, Kesgrave, England

The new plan means that the more you put in (in national insurance contributions), the less pension you will get paid out. This finally nails the lie that national insurance payments are somehow different from income tax.
Simon Craven, Cambridge, UK

The current pension is based on what you have paid in anyway. Not all graduates have been to university for four or more years - some got in the back door as mature students, how will they fare? What about all the IT workers who are degree qualified but saw their jobs outsourced years before they retired and sat on low paid jobs for 20 years before their retirement? This is what's coming. Not being able to draw a pension until 70 years of age is not a problem for doctors and lawyers - the same can't be said for the rest of university graduates. Don't forget too that as more and more people are degree qualified - salaries will go down.
Shaun Smith, East Kilbride

Undergraduates have to pay vast sums of money to go to university and spend a great deal of time paying it back. It hardly seems fair that they will have to wait until they are 70 before they can claim the state pension. Many graduates earn far less than many non graduates. There must be a better system than this suggestion! Perhaps cut the prime minister's pension to a sensible amount!
Alan Morris, Wincanton, England

I've never heard anything so ludicrous. Graduates may have higher salaries and therefore pay more tax and NI than unskilled workers. So what Mr Turner says - if this article is true - is complete and utter rubbish. If the government stopped wasting money on helicopters that cannot fly, wars in Iraq and ID cards, they'd have more money to redistribute as pensions. Instead they blame debt ridden graduates. Madness.
Richard, UK

This can only happen in the UK - not only do graduates have to start their working career tens of thousands in debt because they have to pay off degrees loans, they have to work longer in life as well in order to benefit from a state pension. It's a double-whammy tax on brains and will only spur on the brain drain.
Nick Chandler, Seville, Spain

Clearly as a female graduate and a mother I must resign myself to poverty, particularly as I have taken 12 years out of the job market to raise my four children - the youngest being just 3-years-old. Luckily my husband will have a fairly decent pension but it will still be tough for us. Let's hope I can get myself a good job that gives me the holidays to be there for my children. I don't know about two tier - I'd say three tier - with special provision for mothers who have invested time voluntarily in the next generation.
Marie Peacock, Salisbury

This is lunacy. Students are one of the few groups in society that neither pay, or receive, NI contributions. When they retire they are three years (or more) short on their pensions compared to people who have not gone into full time education. Also ex-students tend to pay the maximum NI contributions for most of their working life. This plan is a real insult to ex students! Yet another anti-student policy/idea by this government!
Simon Windsor, Bristol

The different options for pensions

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