The pension age is rising. Will you be affected?

Watchers of world news may have noticed the huge demonstrations across France last week.

While France has quite a history of public protests, the subject of last week’s might surprise some. Raising the hackles of the French was a relatively sudden decision to raise the pension age from 62 to 64.

Here in Australia, we should be so lucky. Depending on your birth date, the pension age here has been rising in stages over the past few years. It now sits at 66 years, but from 1 July this year it will become 67 for anyone born on or after 1 January 1957.

There are currently no concrete government plans to raise the pension age further, but it is virtually inevitable. The reasons are obvious. We are living longer with each passing generation.

Figures from 2020 showed a life expectancy for females in Australia of 85.7 years and for men 81.6 years. Notwithstanding the effects of the COVID pandemic those numbers will continue to rise.

So raising the pension age does seem to make sense, especially when compared with 100 years ago.

More than a century ago, Australia set the pension age (for males) at 65. At around that time, life expectancy was 63.8 years for females and 59.1 years for males.

In other words, our country’s policy was one of, “Look you’ll probably be dead by age 65, but if you’re not, we’ll take care of you.”

Now, Australians can actually expect to get well over a decade of (hopefully healthy) living after reaching the pension age.

How long will the pension age remain at 67?

That’s a good question. In 2014, the incumbent Liberal government flagged a staggered increase in the pension age, landing at 70 by 2035.

The plan, unveiled as part of that year’s Budget, was not exactly received with open arms. Indeed, it was later abandoned under Scott Morrison’s leadership.

However, Australia’s birth rate is low, and our population is ageing.

The seeming inevitability of an increase to the pension age is supported by modelling. As part of Macquarie University’s Data X project, Professor Hanlin Shang has joined forces with Monash University researchers to crunch the numbers.

Their analysis shows that the Liberals were probably right to abandon their original ‘pension age 70 by 2035’ plan.

Raising it to 70 so soon was too aggressive, they concluded. However, their analysis did confirm what most would suspect: a pension age of 70 will be required, eventually.

What makes these the ‘right’ ages?

Prof. Shang and his Monash colleagues, Professors Rob J. Hyndman and Yijun Zeng, believe 2050 is the right target date.

Their numbers point to a staggered increase to the pension age. It should be raised to 68 years by 2030, 69 years by 2036 and 70 years by 2050.

To arrive at these figures, the team used what is known as the ‘old age dependency ratio’. In simple terms, it is the number of retired people over the pension age divided by the number of working people under the pension age.

The ideal ratio is 23 per cent, according to Prof. Shang’s team.

Without increases in birth rates or immigration, Australia’s pension system will need to increase the pension age to remain sustainable. Increasing it gradually is the best approach, says Prof. Shang.

It seems like a sensible approach, and one that will keep those of us heading towards retirement age from taking to the streets.

Is it fair to keep raising the pension age? Is there a better way to manage an ageing population? Let us know what you think in the comments section below.

Also read: Pension supplement explained

Andrew Gigacz
Andrew Gigacz
Andrew has developed knowledge of the retirement landscape, including retirement income and government entitlements, as well as issues affecting older Australians moving into or living in retirement. He's an accomplished writer with a passion for health and human stories.


  1. Once again, the old age pension was originally designed for that exact purpose, a safety net for those that have not planned for their future, for one reason or another. It’s not a reward for getting old. These days with superannuation and a more educated population regarding fiscal matters, the old age pension should be granted to fewer people as time passes. From the day that you are born you should be educated that if you don’t work, contribute to your community and country, you don’t get handouts from the Government, EG. Taxpayer. It was a very rare commodity prior to the 1970s, The Great Australian Bludger, only too prevalent these days. So yes, the old age pension should be that, an old age pension for people no younger than 70 years and perhaps beyond. You can still retire aged 55, 60, 65 if you so wish. If you have done the hard yards, have worked very tirelessly, putting away the appropriate nest egg for your financial future in later life. And when that runs low or totally out, then and only then you are (rewarded so to speak) with a Taxpayer Funded Pension, for the hard work and responsible life you have lived in support of your family and Country. As President John F Kennedy so rightly said, ask not what your Country can do for you but what you can do for your Country. Which should be included on all Citizenship Applications and for the so-called refugees. Jacka.

  2. Basically your’e assuming everybody living longer will be in good health. I’m not at 64 and have to add to my Super by selling my Unit, and moving into something cheaper to last the next 3 years before I get a Pension.

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