Retirement Age to Be Scrapped in Pensions Review
Morris, Nigel, The Independent (London, England)
OLDER WORKERS will be given the chance to "wind down" into retirement under government plans to be published tomorrow.
Compulsory retirement at 65 will be scrapped in an effort to reduce the growing number of people retiring with smaller pensions than they had anticipated. Andrew Smith, the Secretary of State for Work and Pensions, warned yesterday that employees would have to work longer or save for their retirement because of the "remorseless arithmetic" of an ageing population.
Tomorrow's long-awaited Green Paper on retirement savings is not expected to include radical reform of state pensions, such as raising the basic retirement age, but will concentrate on reducing the regulation faced by companies offering occupational schemes. The formation of a new high- powered pensions watchdog to restore trust in the pensions industry will also be announced.
The moves could disappoint the financial services industry, which has said workers face a pounds 27bn pension "black hole" because of the slump in the stock market. It also reported a near doubling in the number of companies closing their final salary pensions to new members.
It was also reported that the Government would keep under review the possibility of forcing employees to take out private pensions, for instance if tax changes designed to encourage workers to save more fail to solve the problem of retirement provision. …