Baroness Altmann has called for ‘more flexibility in the public pension’ to respond to findings by the Institute for Fiscal Studies that the increase in the public retirement age has caused the number of people to rise by 65 years living below the poverty line. (Report, FT.com, June 20).
Although I agree with Baroness Altmann that we can be more flexible with regard to the public pension, instead of considering faster increases in the retirement age, the government must reform the transition from work to retirement and reflect on how it can better support older people in the labor market. The extra year that people aged 65 and over have to wait before claiming their pensions, which caused this spike, could be spent in the workplace. Older employees have valuable contributions to make to their working environment, and nearly 1.4 million people are working beyond the traditional retirement age of 65, an all-time high.
We can no longer justify this waste of talent, experience and expertise and government and business must do more to improve the work and training of this group. A more useful reform of the pension system would be to introduce phased retirement schemes, to allow a smooth transition from employment supported partly by their pension, and partly by income. The current ‘cliff’ approach to pensions, as these recent reforms have proven, is high risk and not favored by half of UK workers.
Ultimately, a solution to this problem lies in a change of attitude: recognizing the value of older workers to the economy. When talent is used wisely, there is no expiration date and a multi-generational workforce has been shown to foster creativity, innovation and productivity.
It’s not just a solution to labor shortages, but a way out of the pandemic with a stronger, more diverse, and more resilient workforce.
Southall Aspire punter
London WC2, UK