Britain to scrap fixed retirement at 65: government

29th July 2010, Comments 0 comments

Britain will scrap a rule under which people can be forced to retire at the age of 65, the government said Thursday.

The move, which comes into effect from October 2011, is expected to mean more people will work for longer, boosting Britain's strained public finances by paying more tax and not claiming the state pension.

While employers in a few sectors will still be able to enforce a compulsory retirement age, the announcement is part of a growing trend in Europe to encourage people to work for longer in the face of an ageing population.

"Many older people want to work after age 65 and have a wealth of skills and experience that are not being used," Pensions Minister Steve Webb said.

"We want to get rid of the default retirement age so that if they want to work they can do so.

"By spending longer in the workforce, they can also have a better pension in retirement."

Webb added there could be exceptions for jobs like air traffic controllers and police officers where performance can be linked to age.

Earlier this month, the European Commission urged European governments to raise their retirement ages because the current system was "simply not sustainable".

France has announced measures to raise its retirement age from 60 to 62 by 2018, which are fiercely disputed by trade unions. Italy is raising its retirement age from 57 to 61 by 2013.

Britain's coalition government under Prime Minister David Cameron took power in May and has said it will "reinvigorate" the pensions system as it implements tough public sector cuts in a bid to reduce a record deficit.

The average British man retires aged 64.6 years and the average woman at 61.9 years, according to official statistics from 2008.

This compares to 65 years for workers in the United States and 70 years in Japan.

Men in Britain can currently claim the state pension from the age of 65 and women from the age of 60.

Thursday's annoucement was welcomed by Britain's Trades Union Congress but criticised by some business groups, who said it would create uncertainty for employers and staff.

© 2010 AFP

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