One cheer for Tony

British Prime Minister Tony Blair wants to increase Britian's retirement age | Timothy Lamer

It's difficult to know whether, or how much, to applaud a pension-reform plan unveiled late last month by British Prime Minister Tony Blair.

On the one hand, it contains the single most important element of any serious reform effort, an element missing in President Bush's Social Security proposal last year: namely, it raises the retirement age. On the other hand, the Blair plan dilutes the impact of that reform by increasing the benefits paid out to pensioners.

Mr. Blair wants to hike the retirement age from 65 to 66 beginning in 2024 and then to 68 beginning in 2044. But he also wants pension payments to rise with worker earnings instead of with inflation; since earnings have tended to rise faster than inflation, that means a potentially higher price tag for taxpayers.