Women born in 1950’s or later now have to wait longer to claim their pensions in order to bring them into line with men. Annick Masselot, Roberta Guerrina and Bridgette McLellan explain how the UK implemented an EU directive requiring the sexes to be treated equally for social security purposes. They argue that although, on average, women are worse-off in old age and many regard the change as retrograde, the principle of gender equality stands.
This is a fairly complex issue that requires a detailed understanding of European and Member States’ competencies on issues of social insurance and welfare. So what is at stake for women, many of whom have seen their pensionable age rise in the last 3 years?
One issue often overlooked in discussions of pensions and social security is the importance of the principle that men and women should enjoy equal access to these schemes. It goes without saying that the principle of equal treatment is key to achieving gender equality. As obvious as this seems, the principle itself is rather complex in as far as it challenges structural and cultural barriers to achieving equality of outcomes.
So it seems counter-intuitive that the principle of equal treatment should disadvantage women by raising their pensionable age to that of men. Is it true that the introduction of this principle within European legislation has led to inequitable outcomes?
The key directive
The story begins with the adoption of Council Directive 79/7/EEC, which addresses equal treatment in relation to statutory social security matters. The directive specifically required Member States to ensure that there was no direct or indirect discrimination whatsoever on grounds of sex by the end of 1984. As the UK had not at that point implemented national provisions relating to equal treatment in statutory social security schemes, the directive directly shaped the nature and scope of gender equality laws surrounding pensions.
As is made clear by early rulings by the Court of Justice of the European Union, however, the responsibility of ensuring equal treatment after this date often fell on individuals directly affected by the State’s failure to correctly transpose the directive – if transposed at all. This was particularly so in the UK in relation to benefits regarding invalidity. A fairly significant body of case law in this area clarifies further the scope of European legislation and the obligations of Member States in this regard.
From a technical perspective, while Article 4(1) of Directive 79/7 enshrines the principle of equal treatment, Article 7(1)(a) allows for exceptions to the overall principle when applied to setting pensionable age. It specifically acknowledged that changes in state pension need to be gradual and are the responsibility of Member States. In interpreting the scope of the exclusion, the Court of Justice of the EU held that such “discrimination” was necessary in order to achieve the overarching objectives of the directive.
The exception for the difference in pensionable age was considered to be a temporary, in order to enable States to adapt their pension system progressively without disrupting their complex financial equilibrium. Discrimination concerning contribution periods, which are necessarily linked to the determination of pensionable age, was therefore held to fall within the exclusion, as to hold otherwise would render the derogation ineffective. However, it was always the case that eventually, pensionable age was going to be become equal.
The need for an equal pension age
Directive 79/7 certainly played an influential role in shaping the UK statutory social security system. It resulted in the removal of various forms of discrimination in order to ensure a progressive move towards gender equality. As to the issue of discrimination regarding pensionable age, the UK Pensions Act 1995 provides for the equalisation of pensionable age, which is set to increase to 65 for both sexes in 2020, gradually increasing to 68 thereafter. While the increased pensionable age may not fit comfortably with popular understandings of how to advance gender equity, an equal pension age fulfils a key requirement of equal treatment.
If we look at the wider socio-economic context, it is worth noting that the gender pay gap in old age is twice as large as the pay gap between men and women in the labour market. This in turn means that women are at higher risk of poverty in old age. Of course, EU provisions have influenced UK social security legislation, ensuring equal treatment in both statutory and occupational schemes. However, the rise in the pensionable age should be seen chiefly as a consideration of national financial policy rather than the consequence of EU regulation.
Annick Masselot is Associate Professor in Law at the University of Canterbury, New Zealand
Roberta Guerrina is Reader in Politics at the University of Surrey. Her main research interests are the interface between national, European and international politics, particularly with reference to the role of gender values/norms in shaping policy agendas.
Bridgette McLellan is a postgraduate student in law at the University of Canterbury, New Zealand
This post as been updated and was first published in the LSE.
Campaigners have lost a significant legal battle against the government’s handling of the rise in women’s state pension age.
The retirement age for women rose from 60 to 65, in line with men, and will go up to 66 by 2020, and to 67 by 2028.
Women born in the 1950s claim the rise is unfair because they were not given enough time to make adjustments to cope with years without a state pension.
They argued the changes were discrimination, but judges disagreed.
In a summary judgement, the two judges said the original pension ages of 60 for women and 65 for men were “direct discrimination in favour of women which reflected the circumstances of the day and created a relative disadvantage for men.”
They added: “This legislation does not treat women less favourably than men in law, rather it equalises a historic asymmetry between men and women and thereby corrects historic direct discrimination against men.”
And the judges said the government, and previous governments, had “engaged in extensive consultation with a wide spread of interested bodies”.
They concluded: “The court was saddened by the stories contained in the claimants’ evidence.
“But the court’s role was limited. There was no basis for concluding that the policy choices reflected in the legislation were not open to government. In any event they were approved by Parliament.”
The case had argued the Department for Work and Pensions (DWP) “discriminated against them on the grounds of age, sex, and age and sex combined” and claimed they were not given adequate notice to adjust. LINK
Retirement ages in different countries
In the EU Member States, the most general retirement age is 65 years. Spain, Germany and France are about to raise their retirement age from 65 to 67 years, while the goal is 68 years in Britain and Ireland.
Increasingly, the retirement age is being linked to life expectancy. In addition to Finland this mechanism is available in Cyprus, Denmark, Estonia, Greece, Italy, the Netherlands, Portugal and Slovakia. Also in Britain, after mechanical increases, the retirement age will rise taking life expectancy into account.
For the main part, the changes in retirement ages are scheduled to take place between 2020 and 2030.
In some countries, the retirement ages are different for men and women. In that case, women have a lower retirement age. As a rule, as the retirement ages rise, women’s retirement ages will be the same as those of men.
Current retirement ages (2019)
Check out the retirement ages and decisions to raise the retirement ages in the table of comparison below. The table lists first the earnings-related retirement age, then the national retirement age if it deviates from the first. Men’s and women’s retirement ages are also listed, if they differ from each other.
The retirement ages in the table are the earliest ages at which a person can withdraw a statutory pension without deductions for early retirement. In most cases, people can also retire late. As a rule, they are entitled to an increment for late retirement.
In many countries it is possible to retire early, before the general retirement age of the old-age pension. In some countries, if the insurance period is long, the pension taken into payment early is not reduced. These special arrangement have not been included in the table.
The retirement age in Norway, Sweden and Finland is flexible. That means that a person can take out their pension within a certain age range. The upper and lower age limits have been listed in the table.
|Current general retirement age (2019)||Future retirement age|
|EU||Men/ Women||Retirement age or men/women|
|Austria (AT)||65 / 60 years||65 years (2033)|
|Belgium (BE)||65 years||67 years (2030)|
|Bulgaria (BG)||66 years and 4 months||67 years (2023)|
|Croatia (HR)||65 years / 62 years||67 years (2038) / 65 years (2030); 67 years (2038)|
|Cyprus (CY)||65 years||65+ years (2018)|
|Czech (CZ)||63 years and 6 months / 63 years and 2 months||65 years (2036)|
|Denmark (DK)||67 years; 65 years and 6 months*||67 years (2022); 68+ years (2030)|
|Estonia (EE)||63 years and 6-9 months||65 years (2026) 68+ (2027)|
|Finland (FI)||63 years 3-6 months . 68 ; 65* years||65+ years (2027); 65+ (2030)|
|France (FR)||66 years and 2 months||67 years (2023)|
|Germany (DE)||65 years and 7 months||67 (2031)|
|Great Britain (GBR)||65 years||67+ (2028), 68 (2046)|
|Greece (EL)||67 years||67+ years (2021)|
|Hungary (HU)||64 years||65 years (2022)|
|Ireland (IE)||66 years||68 years (2028)|
|Italy (IT)||66 years and 7 months||67+ years (2022)|
|Latvia (LV)||63 years and 6 months||65 years (2025)|
|Lithuania (LT)||63 years and 10 months / 62 years and 8 months||65 years (2026)|
|Luxembourg (LU)||65 years||–|
|Malta (MT)||63 years||65 years (2027)|
|Netherlands (NL)||66 years||67+ years (2022)|
|Poland (PL)||65 years / 60 years||–|
|Portugal (PT)||66 years and 5 months||66+ years (2016)|
|Romania (RO)||65 years / 61 years – 61 years and 2 months||-/63 years (2030)|
|Slovakia (SK)||62 years and 6 months||63 years and 2 months+ (2024)|
|Slovenia (SI)||65 years||–|
|Spain (ES)||65 years and 6 months||67 years (2027)|
|Sweden (SE)||61-67 years; 65 years*||63-69 (GP; 2023), 63+ (2026); 66 (2023), 66+ (2026)|
|Other countries||Men / Women||Retirement age or men/women|
|Australia||57 years; 65 years and 6 months*||60 years (2025); 67 years (2023)*|
|Canada (CA)||65 years||–|
|Iceland (IS)||67 years|
|Japan (JP)||63 years / 62 years; 65 years*||65 years (2025) / 65 years (2030); –|
|Norway (NO)||62-75 years; 67 years*||–|
|Russia (RU)||60 years and 6 months / 55 years and 6 months||65 years (2028); 60 (2028)|
|Switzerland (CH)||65 years / 64 years||–|
|USA (US)||66 years||67 years (2027)|
* FI, SE, DK, NO, AU and JP: the retirement age of the earnings-related pension has been separated from that of the national pension with a semicolon. GP= Government proposal or plan of equivalent administrative level; + = Retirement age rising along with the increasing life expectancy.