Scottish state pension.

The future state pension age in an independent Scotland will be determined by the Scottish Parliament following recommendations from experts, a paper published this week will confirm.

The Scottish Government paper – ‘Pensions in an Independent Scotland’ – will set out the arrangements for state, private and public sector pensions following independence.

State pension policy is currently reserved to Westminster. Under current UK plans, the state retirement age will begin to increase to 66 for both men and women from 2018 and to 67 from 2026.

The Scottish Government paper confirms that “the rapid move to 67 is a concern” and that an expert commission would be established following independence to assess the appropriate pace of further change to the retirement age beyond 66, taking account of Scottish circumstances. The paper notes that:

“The UK Government’s plans are based around the core principle that the proportion of adult life spent in receipt of the state pension should be consistent to ensure fairness between generations…These changes fail to recognise that life expectancy can be more restricted for particular socio-economic groups. The proportion of adult life spent in retirement, and in receipt of a state pension, reduces to a greater extent for those in lower socio-economic groups who have on average a lower life expectancy.”

In 2013 the life expectancy at birth in Scotland was 1.8 years lower for females and 2.5 years lower for males, meaning the average number of years spent in receipt of the state pension is lower in Scotland than the UK average.

Deputy First Minister Nicola Sturgeon said:

“In an independent Scotland, pensions will be paid in full, and on time, as now.

“But we are concerned about Westminster’s accelerated timetable for increasing the state pension age to 67. This is now planned to be delivered eight years earlier than previously expected – with significant implications for individuals.

“We want to make sure that the pension age suits Scottish circumstances. But Westminster changes fail to take into account the life expectancy differences between different socio-economic groups and between Scotland and the UK average.

“On average, people in Scotland have fewer years in retirement receiving the state pension than our counterparts in the UK because life expectancy is lower. That is an anomaly that needs to be tackled – and independence will also give us greater ability to do that – but in the meantime, it is important to ensure that Scots approaching retirement age are not unfairly disadvantaged.

“In the first year of an independent Scotland, we will establish an independent commission to consider the appropriate pace of further change to the retirement age beyond 66, taking account of Scottish circumstances. The commission would report to the Scottish Parliament within the first two years of independence, allowing us to take decisions which best suit the needs of people in Scotland nearing pensionable age.”