A dispute between government departments risks delaying an announcement on
the mandatory retirement age until after the general election, industry experts
fear.
The release of a policy on whether to standardise the retirement age at 65,
extend it to 70, or abolish it altogether has already been delayed this year.
Further hold-ups are likely because of a disagreement between the Department
of Trade and Industry and the Department for Work and Pensions (DWP). The DTI,
which is conducting a review of the issue, is believed to want a mandatory
retirement age of 65 – a position opposed by the DWP.
The ongoing delay is hampering personnel planning as businesses wait to see
which way the government leaps, said David Yeandle, deputy director of
employment policy with the manufacturers’ organisation EEF.
"There is absolutely no doubt that the deadline is going to be missed
again, at least by a few months," he said.
Yeandle added that the fear among employers was that the Government would
try to stretch that delay to prevent it from becoming an election issue.
If an announcement is made after the election employers could be left with
only one year to make adjustments before legislation enforcing the policy is
passed in 2006.
Owen Warnock, partner in the HR group at law firm Eversheds, said a delay
until after the election would put unnecessary pressure on businesses.
"There’s not much time [for employers] to do things as it is," he
said. "To lose a year would be a huge disappointment. That’s a massive
delay."
A DTI spokesman initially referred Personnel Today’s questions about the
delay to the DWP. A DWP spokeswomen said queries should be redirected back to
DTI. "It’s their consultation process, ask them," she said.
The DTI spokesman finally told Personnel Today that he did not know when the
policy would be released as "ministers across [the] Government were
considering their options".
By Paul Yandall
… but Pensions Bill could suffer from being rushed
While the decision on retirement ages
is being delayed, the Pensions Bill is being rushed through Parliament in time
for a general election and is growing at an alarming rate in length and
complication.
The Bill was introduced in the House of Commons in February
this year and is designed to provide new security for pension scheme members
through a £400m Pensions Protection Fund (PPF), with a ‘Pensions Regulator’ to
focus on under-funding, fraud and maladministration.
The Bill is now being read in the House of Lords, and the
Government hopes it will be law by April 2005.
The DWP said that simplification measures in the Bill would
make it easier for employers to provide pensions, by cutting through red tape.
However, since the Bill’s introduction three months ago, it has
grown from 235 pages, 248 clauses and 12 schedules to 316 pages, 310 clauses
and 13 schedules.
David Yeandle, deputy director of employment policy at the EEF,
said he could not recollect a Bill that had grown so much since its
introduction.
"This is not a good way to legislate on such an important
issue," he said.
"The Government ought to be going for April 2006, but
there are political imperatives – it wants to be able to show it has solved
this problem by the general election," he added.
The DWP strongly denied that the timescale for the Bill had
anything to do with political expediency and said the aim was simply to get the
PPF in place as soon as possible.
