04/08/10

By Andrew Holt

The abolition of forced retirement is not only a ‘huge victory' for workers at risk of being forced out of their jobs because of their age, but is also a ‘landmark' for the UK society at large, as older workers, the UK economy, public finances and employers will all benefit from this change, said Age UK.

The charity hailed the announcement that the Government is consulting on scrapping the Default Retirement Age (DRA) from October 2011 as a huge victory for hundreds of thousands of employees who are at risk of being forced to retire at or after reaching 65 for no other reasons but their age.

Age UK estimated that around 100,000 workers over 65 were pensioned off against their will in 2009 as employers used forced retirement as a shortcut to shed jobs.

Responding to those employers' organisations who have lamented the negative impact of this decision on businesses, Age UK stresses that scrapping forced retirement is a ‘landmark' for society and points to the Government's impact assessment to show the UK economy, employers, public finances and older workers will all benefit from this measure.

According to the impact assessment published last week alongside the consultation on abolishing the DRA, employers themselves stand to save £45 million in the first year after the DRA is scrapped, rising to £71 million per year in a decade, against estimated one-off costs of £38 million.

The UK economy will also benefit from the increased skills and knowledge available, while the Exchequer will gain an extra £79 million in tax revenues in the first year alone and £132 million extra each year after a decade.

Michelle Mitchell, Age UK charity director, said: "We have led a four year campaign to achieve this historic decision so Age UK is absolutely delighted that the Government is setting a clear date for the abolition of this arbitrary and unfair law.

"Not only is this a huge victory for hundreds of thousands of employees who are at risk of being forced out of their jobs simply because of their age, it is also a landmark achievement for the UK society in the progress towards a fairer and more age-friendly society.

"There's overwhelming evidence to show that older workers, the UK economy, public finances and employers themselves will all benefit from the announced abolition of forced retirement legislation.

"The Government has made the right call on forced retirement and we encourage ministers to stand by it."

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