Scrapping default retirement age 'would boost economy'

Mon 21 Jun 2010

A charity has called on the government to abolish the default retirement age as part of its efforts to stimulate the economy.

According to Age Concern, the public purse would benefit from lots of additional tax revenue if workers aged 65 were allowed to stay on for longer.

Therefore, the charity believes the government should scrap this "hugely unpopular" law, which it said is "well past its sell-by date".

Michelle Mitchell, director of Age UK, said having the default retirement age in place "makes a mockery" of the government's intentions to help people work for longer.

She added that forcing people out of the labour market when they want to work and contribute to the economy is "nonsense".

Ms Mitchell was speaking after a poll by the charity found that two-thirds of consumers are opposed to the default retirement age.

Age UK has called on the government to say when it plans to abolish the policy in this week's Budget, in order to end confusion and speculation in the business sector.

This comes after the Institute of Directors suggested that the default retirement age be raised to 68, to take people's longer life spans into account.

Sue Kelly, an employment partner at Winckworth Sherwood, commented: "It is clear that, for a variety of reasons, people will increasingly wish or need to retire later in life.

"However, there may still be a case for retaining a default retirement age, albeit at a higher age. The arguments do not all point in the same direction."