Law on retirement needs pensioning off

Headlines around the government’s announcement that John Cridland is to review the state pension age sounded typical alarms – workers will have to struggle on to a later age – even until death. But most of the scare stories miss a fundamental question: how do you raise the retirement age in practice?
The bad news is that a rise in state pension age is inevitable and probably overdue. When David Lloyd George introduced the state pension more than a century ago, the retirement age was 70, compared with 63 or 65 today. And the system designed to provide for extreme old age has become a basis for taking older people out of the workforce.

The good news is that this arises only because we are living much longer, and are healthier, active and effective much longer too. However, being capable of being economically valuable is not the whole story – there are other problems to solve.

First, people must be warned to expect change. Our postwar complacency about pensions and retirement ages has left a whole generation assuming, reasonably but wrongly, that retirement ages would never shift.

Women Against State Pension Inequality typify a spirited aggrieved group. Its members don’t object to the fact that women’s retirement age is rising from 60 to 65 – to equal that of men’s – and then to 68, but that they weren’t informed for years. The change was initially made in 1995, to take effect from 2010 but it appears that, until the timetable was accelerated in 2007, little was done to highlight what was bound to be a politically unpopular move.
I knew about it because I read the statute, but then I am a pensions lawyer and it was my job. Any woman with better things to do with her time was unlikely to know and some had as little as two years’ notice that their retirement age was going to be much later than expected. No amount of prudential retirement planning can deal with that shifting of the goalposts.

But informing people is not enough – they need to have the power to deal with the mobile goalposts of life expectancy and pension ages.
Despite age discrimination legislation, the UK can still be breathtakingly ageist in the employment arena. There is no good reason not to employ most of those in their 60s and indeed 70s in a whole range of roles. Of course, there are physical jobs that become harder for older people, but that is not a new issue and does not excuse the difficulty older people continue to find in obtaining paid employment.

Cridland has his work cut out for him, and no doubt will be constantly badgered on this sensitive issue, but it is hard for him to consider it in a vacuum. Without the opportunity for older people to work, and without proper planning and notice, the inevitable rise in state pension age can only cause more trauma.

Read the full article in The Times’ The Brief here.