Retirement age review to be brought forward

Saturday, 18 July 2009

Would you like to go on working longer? If you are retired, would you have welcomed the chance to earn some more money before having to draws your pension?

The world moves on. A review of the default retirement age is to be brought forward by a year. The current default age of 65 could soon become a thing of the past.

Although most people do retire before they reach 65, 1.3 million people stay on, and many more say they would do if they were allowed to do so.

The review, scheduled for 2011, will now take place next year, in response – say ministers – to changing demographic and economic circumstances. Prime Minister Gordon Brown said: “Evidence suggests that allowing older people to continue working, unfettered by negative views about ageing, could be a big factor in the success of Britain's businesses and our future economic growth.”

While employers group the CBI described the move as “disappointing”, the TUC welcomed it. General secretary Brendan Barder said: “It cannot be right that an employer can sack someone simply for being too old. Employees should have choice - neither forced by employers to give up work, nor forced by inadequate pensions into working longer than they should.”

The CBI claimed that a default retirement age helped companies plan for the future, and that 81% of employees who had asked to continue working had been allowed to do so.

Pensions Minister Angela Eagle said: “Our own research shows that many more people wish to work a little bit beyond retirement, and perhaps wind down their working lives rather than have them abruptly cut off, and I think that as a society that's something that we need to consider.”

The move could well help people to earn more and save more for their eventual retirement without the embarrassment of having to request to be allowed to continue to work. The option to retire will still be there.

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