This FT article on European state pensions describes rising costs, ageing populations and repeated political failure. But I think we need to dig a little deeper and reflect on the original purpose of the system before contemplating change.
State pensions were created to prevent poverty in old age and they still provide that value today. For many, the state pension is essential income that provides stability where private saving is limited or impossible. That role and those people need protecting.
But the system now does more than that. People live longer and retire for longer. Many reach state pension age in good health and have significant savings and assets. The state pension now supports a long period outside paid work, not just the end of life.
There has also been a wider cultural change. Older people are less likely to be supported by extended family than in the past and independent retirement has become the norm. That change reflects social and economic shifts, including women’s employment and greater geographic mobility. It also reflects the presence of a reliable state pension. Public provision reduced reliance on family support and helped normalise retirement as a publicly supported life stage rather than a private or familial responsibility.
That matters because cost can’t be judged without context. An expensive policy can be good value if it is delivering what society wants. We cannot assess value without knowing whether the state pension is meant to prevent poverty, replace earnings, support a long retirement, manage labour market exit, or try to do all of these at once.
The FT notes that across the EU, 47% of all social protection spending now goes on old age and survivors’ benefits. That figure is often used to imply excess. On its own, it tells us very little. High spending may reflect demographic change, policy choice, or success in reducing poverty. Without clarity on purpose, the number becomes a talking point rather than evidence.
The same lack of clarity sits underneath debates about the state pension age and the triple lock. These are not technical adjustments. They determine when the state steps in and how much support people receive. Those decisions only make sense once the role of the state pension is defined.
The problem is that the government has not said clearly what the state pension is for, in the world we now live in. Until that question is answered, arguments about cost, pension age, and uprating will remain stuck, and policy will continue to drift by default rather than by design.
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