Monday, 21 June 2010

Most people want a speedy end to the DRA

Two-thirds of people support government plans to abolish the default retirement age (DRA) of 65, according to a survey of 1,011 people by charity Age UK.

The majority of respondents (70 per cent) said it was wrong to enable employers to force staff to retire when they reach a certain age.

Plans to phase out the DRA have already been announced by the coalition government but Age UK has called for an abolition deadline to be made clear when the Budget is unveiled tomorrow.

The charity has claimed that £3.5billion was wasted last year because tens of thousands of workers were forced to stop working when they reached 65. It said that people who work beyond 65 generate extra tax revenue and can reduce employers’ pension liabilities. Further government plans to raise the state pension age would save taxpayers billions of pounds, it said.

Michelle Mitchell, director of Age UK, said: "The default retirement age is a hugely unpopular law which is well past its sell-by date.

"Forcing people in later life out of the labour market when they want to work, save for their pensions and pay taxes is nonsense. It makes a mockery of the government's plans to help people work longer.

"A clear commitment to scrapping forced retirement next April is needed to end speculation and confusion among employers and employees alike. It would show how the Government was making freedom and fairness a reality for many people in later life who are denied that opportunity."

Last week Steve Webb, Pensions Minister, hinted that the DRA could be repealed much sooner than the coalition government initially suggested. He said the government’s phasing out approach would be applied “vigorously” and called the DRA an “anomaly”.

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