The Government is reforming the pension system in order to save money
The Guardian reports that UK Treasury Chancellor, George Osborne, is planning to implement reforms related to public funding. Thus, increasing the retirement age to 70 years can save £ 500 billion over 50 years.
Young people now beginning their career in the United Kingdom will retire just in the age of 70. This greatly improves the condition of the state budget.
In addition, Chancellor is going to cut annual government spending by £ 1bn by cutting the budget of all ministries by 1.1 % in three years. Thus the financing of health, education and security services will not change. Osborne hopes to restore public finances and develop economic growth.
Today's pension reform of the Treasury Chancellor is one of the longest lasting since the introduction of the state pension in 1908. Retirement age will be calculated under the new formula connected with life expectancy in the country.
British Prime Minister David Cameron commented on the new economic policy of the state: "We are working for the long term. The new plan will pay off debts to overcome the deficit and create jobs".
Previously, the government has decided to increase the retirement age to 66 by 2020 and up to 67 years to 2028. The Chancellor said that the changes in the pension system do not apply to those British who have reached 50 years of age.
