Budget 2012: State pension to reflect life expectancy

Chancellor George Osborne has confirmed future increases in the state pension age will be linked to life expectancy.

George Osborne
George Osborne

Speaking to Parliament today as part of the Budget, Osborne said details of how the “automatic review” system will work will be published in the summer.

Osborne also told MPs that if government departments continued spending at current rates the welfare bill will have to be cut by £10 billion by 2016.

Plans to introduce a link between the state pension age and longevity were first outlined in a Department for Work and Pensions green paper published in April 2011.

The green paper also set out proposals to introduce a flat rate state pension worth £140 a week.