State Pension Age review: what advisers need to know

The UK Government has launched its third review of the State Pension age (SPA), a process that takes place every few years under the Pensions Act 2014.

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As part of this review, the Department for Work and Pensions (DWP) has issued a call for evidence, inviting views from organisations, experts, and individuals. The review, led by Dr Suzy Morrissey, will shape recommendations on how the SPA should be set for decades to come.

• Watch: Paraplanners' Assembly video on the State Pension age review.

For advisers and paraplanners, this consultation is not simply a matter of public policy – it has direct implications for retirement planning, client cashflow modelling, and the sustainability of retirement incomes. Understanding the key themes will help professionals guide clients through an evolving pension landscape.

The purpose of the review

The Government is required to review SPA at least once every six years to ensure the system remains fair, affordable, and sustainable. 

Dr Suzy Morrissey, appointed to produce an independent report, is tasked with recommending a framework for setting the SPA in future decades.

The report will consider three key areas:

1. The merits of linking SPA to life expectancy, a model already adopted in some countries.
2. The role of SPA in ensuring the long-term sustainability of the State Pension.
3. The international experience of Automatic Adjustment Mechanisms (AAMs), where pension ages adjust automatically in response to demographic or fiscal indicators.

Dr Morrissey has emphasised the far-reaching impact of SPA decisions and is seeking evidence from as broad a range of stakeholders as possible. 

The date for closure of submissions is 24 October 2025.

The demographic challenge

"Unless taxes rise or means-testing is introduced, the government may be forced to raise the SPA or reduce benefits."

Underlying this review is a stark demographic reality. Rising longevity and declining birth rates are reshaping the UK’s age profile. 

By 2050, one in four people is expected to be aged 65 or older. That means fewer working-age taxpayers will be supporting a growing retired population – a structural challenge for the financing of the State Pension.

Life expectancy projections illustrate the pressure. By 2025, a 66-year-old man is expected to live, on average, another 19.2 years, rising to over 21 years by 2050. For women of the same age, the projection is 21.8 years in 2025, rising to nearly 24 years by 2050. 

Unless taxes rise or means-testing is introduced, the government may be forced to raise the SPA or reduce benefits. Both options are politically toxic, yet without reform, the sustainability of the system could be undermined.

The current timetable

Under existing legislation, the SPA is set to increase to 67 between 2026 and 2028, and to 68 between 2044 and 2046. 

The review does not automatically change these timetables but will inform whether adjustments are recommended.

Historically, governments have typically raised the SPA to control costs. 

However, changing health outcomes, variations in life expectancy across regions and socio-economic groups, and the broader affordability of retirement could all influence whether alternative policy options are considered this time.

Adviser and paraplanner perspectives

For advisers and paraplanners, the uncertainty surrounding SPA creates both challenges and opportunities in client planning:

Income reliance on the State Pension

Research from Just Group shows that over 40% of current State Pension recipients rely on it for most of their income. In addition, 62% of individuals retire before reaching SPA, often due to redundancy or ill-health. If the SPA is raised further, many individuals may face a larger income gap than expected before State Pension payments begin.

Political and behavioural barriers

Once benefits are introduced, scaling them back is notoriously difficult. Labour’s recent attempts to amend winter fuel payments and disability benefits offer clear examples. This suggests that, while raising SPA may be the most likely outcome for the Government, reducing the value of payments or introducing widespread means-testing cannot be ruled out.

Private pension provision becomes more urgent

Repeated reliance on SPA increases as a cost-control mechanism highlights the need for stronger private savings. If clients cannot depend on predictable State Pension outcomes, Advisers must stress the importance of building robust personal and workplace pension provision, alongside diversified income strategies.

Client planning implications

"The State Pension should be regarded as a foundation, and not a guarantee, of retirement income."

Advisers and paraplanners should commence scenario planning now, to help clients prepare for potential outcomes of the review:

Stress-test retirement plans

Model cashflows assuming both a higher SPA and reduced State Pension amounts. This can highlight potential funding gaps and reinforce the importance of early action.

Develop bridging strategies 

For clients expecting to retire before SPA, identify how income needs will be met in the gap years. Options may include flexi-access drawdown, annuities, ISAs, or phased retirement.

Account for health and longevity considerations

Averages can mask significant disparities. Clients in poorer health or lower-income brackets may be disproportionately affected by SPA rises, making flexible and tailored planning critical.

Communicate and educate clients

Ensure that clients understand that State Pension policy is not fixed. The State Pension should be regarded as a foundation, and not a guarantee, of retirement income.

Policy direction: what could change?

Three broad directions of reform are possible:

Linking SPA directly to life expectancy

This would create a transparent, rule-based system. However, it risks being seen as unfair to those cohorts with lower life expectancy, often influenced by income and geography.

Introducing ‘automatic adjustment mechanisms’

AAMs are already used in countries such as Denmark and Finland, where pension age changes are triggered automatically by demographic or fiscal measures. Such systems provide predictability for governments but may reduce the flexibility to respond to social or economic concerns.

Means-testing or moderating payments

A politically challenging option, but one that could redistribute resources to those most in need. Advisers and paraplanners would need to prepare for the impact on middle-income retirees, who currently rely on full State Pension entitlements.

Next steps

"Reform is inevitable – the only constant is change."

Dr Morrissey’s call for evidence is open until 24 October 2025. 

Once submissions are collected, Dr Morrissey will prepare her independent report, which will inform the government’s official review and subsequent decisions on SPA. Final outcomes may not emerge until well into 2026, but the direction of policy is clear: reform is inevitable.

Looking ahead

For advisers and paraplanners, now is the time to begin conversations with clients about the future of the State Pension. Emphasising the importance of diversified retirement income, stress-testing financial plans, and preparing for uncertainty, will ensure clients are better placed to adapt to whatever reforms emerge.

The third review of the State Pension age is more than an administrative exercise – it is a response to profound demographic and fiscal challenges that will define retirement policy for decades. While the outcomes remain uncertain, the themes of sustainability, fairness, and affordability are unavoidable.

For advisers and paraplanners, the task is clear: help clients prepare for later State Pension access, possible benefit moderation, and the growing importance of private provision. This can provide reassurance and resilience in an environment where the only constant is change.

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Watch: The State Pension age review

In this Paraplanners' Assembly video, host Richard Allum speaks with BW’s James Jones-Tinsley about the government’s independent review of the State Pension age. They examine possible increases beyond 67 by 2028, the uncertain future of the ‘triple lock’, and what international models could mean for the UK.