The government has frozen plans to accelerate the rise in the state pension age.

Work and Pensions Secretary Mel Stride confirmed the move following newspaper reports that suggested the government was erring over the plans.

The age at which the state pension is payable currently stands at 66, and by the end of 2028, it will have risen to 67.

Increasing the state pension age to 68 was scheduled to happen between 2044 and 2046 – but ministers had been contemplating bringing that forward to between 2037 to 2039.

Mr Stride said he agreed the rise in the state pension age from 66 to 67 should occur between 2026 and 2028 as planned, but that parliament should “consider the rise to age 68 again”.

He said that decision will be delayed until after the next election, with another review taking place “within two years of the next parliament”.

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Increasing the state pension age had been on the cards because of the trend of people living longer. However, the coronavirus pandemic changed that, reducing the life expectancy for women by one year and 1.3 years for men – removing a key justification for changing the rules.

The decision to delay the changes could also have been influenced by France – where violent protests have erupted at President Emmanuel Macron’s proposals to raise the state pension age to 64 – and the Tories’ own electoral prospects.

Mr Stride told MPs: “Given the level of uncertainty about the data on life expectancy, labour markets and the public finances, and the significance of these decisions on the lives of millions of people, I am mindful a different decision might be appropriate once these factors are clearer.

“I therefore plan for a further review to be undertaken within two years of the next parliament to consider the rise to age 68 again.”

‘Responsible and reasonable approach’

The cabinet minister defended his approach, saying it “continues to provide certainty for those planning for retirement” while ensuring in the longer term, it is “sustainable and fair across the generations”.

He said the government “remains committed” to the principle of the 10-year notice of changes to the state pension age.

“The approach I’m setting out today is a responsible and reasonable one,” he said.

“One that continues to provide certainty for those planning for retirement, while ensuring that we take the time to get this right for the longer term, so that the state pension can continue to provide security in retirement and is sustainable and fair across the generations.”

Mr Stride confirmed that the increase in life expectancy has “slowed” since the first state pension age review was carried out in 2017 – a trend he said was being seen “to a varying degree across much of the developed world”.

He cited an independent report by Baroness Neville-Rolfe carried out in 2022, which he said “highlights an important challenge: a growing pensioner age population and the affordability and fiscal sustainability of the state pension”.

“As a society we should celebrate improvements in life expectancy, which has driven rapidly over the past century and is projected to continue to increase,” he said.

‘Not exactly a sign of strength’

The announcement swiftly received a hostile reception from former cabinet minister Jacob Rees-Mogg, who said: “Unlike the Labour Party I don’t welcome this decision.

“That life expectancy from retirement from the 1940s to today has increased by seven years, which would indicate a retirement age of 72 rather than of 67 or 68.

“The benefit of long-term decision-making is that it gives everybody the chance to plan well in advance. And the delaying the decision is a decision in itself, and is not exactly a sign of strength.”

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Labour’s shadow work and pension secretary Jon Ashworth welcomed the delay but said the stalling life expectancy rates that drove it were a “damning indictment”.

“Today’s announcement that they are not going ahead with accelerating the state pension age is welcome, and it is the right one,” he said.

“But it is the clearest admission yet that a rising tide of poverty is dragging life expectancy down for so many, and stalling life expectancy, going backwards in some of the poorest communities, is a damning indictment of 13 years of failure which the minister should have acknowledged and apologised for today.”

The UK’s private sector has shrunk for the eighth consecutive quarter.

That is according to data from the Confederation for British Industry, which said its latest snapshot of the sector showed “signs of green shoots” – with projections that UK industry will return to growth in the next quarter.

The organisation’s lead economist, Alpesh Paleja, said the expected return to growth was “encouraging” and supported other data showing some resilience in economic activity.

“But let’s be clear – at best, this illustrates an economy skirting stagnation-like conditions rather than delivering the strong, sustainable growth we need,” he warned.

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The CBI data showed that activity in the UK private sector contracted by around 4% in the three months to March – the eighth consecutive quarter of decline, but the mildest drop since July last year.

The main driver was a weak services sector – the survey showed an 11% drop in consumer services volumes.

Distribution activity increased slightly while manufacturing contracted, albeit at a slower pace over the quarter.

Chancellor Jeremy Hunt announced plans to deliver growth in his spring budget, including increased childcare provision to help parents get back to work.

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The Office for Budget Responsibility (OBR) also confirmed the UK economy is on track to avoid a technical recession, which means two consecutive quarters of decline.

But Mr Palega said the UK is still facing “considerable economic headwinds”.

“Inflation remains stubbornly high and, while businesses and consumers can expect lower energy prices to feed through later in the year, the pressures on household budgets will weigh on consumer spending,” he said.

Visitors to Wales could be paying an additional fee for staying overnight amid plans to introduce a tourism tax in the country.

The Welsh government says it is moving ahead with plans to introduce a “visitor levy” in Wales.

Local authorities will have powers to introduce a levy in their areas, the money would then be spent on maintaining the local area.

Plans will need to be rubber-stamped by the Senedd before they are introduced but they are likely to get passed it’s one of the policies included in the co-operation deal between the Labour government and Plaid Cymru which was agreed after the last Senedd election in 2021.

The Welsh government says the charge will be “small” at commercially-let overnight visitor accommodation.

The Welsh Conservatives, the largest opposition party in the Senedd, has accused the government of “taking a sledgehammer to crack a nut”.

A similar scheme is already in place in more than 40 destinations across the world including Greece, Frankfurt in Germany, and Amsterdam in the Netherlands, the Welsh government argues.

A consultation received over 1,000 responses and the government says there was support across most local authorities and other organisations.

Responses also came from tourism industry representatives and many disagreed with the principle of introducing a fee.

The Welsh government’s consumer research found that 58% of respondents thought tourists should pay towards the upkeep and investment in their local area.

It also found that support for tourism tax was highest in areas which attracted the most tourists.

‘Sledgehammer to crack a nut’

Finance and local government minister Rebecca Evans said: “We understand some businesses have reservations about a visitor levy and I am grateful to all those who took the time to respond to our consultation.

“These responses will be carefully considered as we continue to develop our specific plans for a levy.

“Many destinations around the world use visitor levies to empower and enhance their local areas for the benefit of visitors and locals alike – I am confident this will be the case here in Wales.”

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The Welsh Conservatives’ shadow tourism minister, Tom Giffard, voiced the party’s opposition to the plans.

“Nothing says welcome to Wales more than Labour announcing they will be pressing ahead with their toxic tourism tax as families gear up for the Easter holidays,” he said.

“Tourism supports one in seven jobs in Wales enabling people to pay council tax, helping to tackle the issues that Labour claim a tourism tax would fix.

“The Labour government should be working with the industry to boost this vital sector instead of taking a sledgehammer to crack a nut.”