Age campaigners and employer groups have welcomed the government’s plan to “quickly phase out” the default retirement age (DRA) from 2011, but have questioned the need for another consultation.
In the Budget documents published yesterday to support the speech made by chancellor George Osborne, the government revealed it will start to consult on how it should remove the DRA of 65 from next year.
The documents state: “To ensure that those who wish to work beyond 65 are able to, the government will consult shortly on how it will quickly phase out the Default Retirement Age from April 2011.”
Coalition documents published as the new government was formed also stated the government would “phase out” the DRA, but offered no timescale for this.
Rachel Krys, campaign director at the Employers Forum on Age, told Personnel Today yesterday’s announcement was a “positive step forward”.
She said: “It is good to see they have acknowledged this is something that has to change and will help them to reduce pension bills and extend working life. It’s not too optimistic a timetable really. Employers just need to know when it’s going to happen.”
Krys said she wanted the government to announce in April 2011 that it will be abolishing the DRA in October 2011 – rather than phasing it out in stages – giving employers time to adapt their policies and practices.
“They should just get rid of it. Upping the age every six months or every year would be slightly ridiculous for employers to cope with,” she said.
Chris Ball, chief executive of The Age and Employment Network, said while he welcomed the government’s decision to remove the DRA, he questioned whether another consultation was needed and said the business world “could have done with some clarity” on the government’s precise intentions.
The former Labour government also consulted on the DRA last year, but the findings are yet to be published.
He said: “I’m not sure we need another consultation, we have had plenty on this. I would have thought the government would be in a good position to move forwards with some confidence now and state pretty clearly what they intend to do.”
Charles Cotton, rewards adviser at the Chartered Institute of Personnel and Development, added: “It is a shame they have swerved a clear decision on the DRA, and have chosen instead to hold yet another consultation on its abolition.
“They should make their consultation swift, and move quickly to bring to an end the absurdity of enforced retirement.”
Research published earlier this week by Age UK found 65% of the public think the DRA should be scrapped immediately.
Michelle Mitchell, director of Age UK, said: “The consultation on phasing out the DRA is another welcome shuffle forward towards ending this unfair and unsustainable law. But to give tens of thousands of older workers the job security they deserve, we need a definitive commitment and timetable.”