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Patrick Spencer: State pension
age must be raised
A recent proposal to up the state pension age to 75 has been received with
concern by employers and think tanks, hears RACHEL MULLER-HEYNDYK
Employers worry many older people will be too frail to continue working i into their seventies
Figure
it out
53%
of employees
aged 60 or older
say they are not
ready to retire
Aviva
21%
of the UK
population will
be 65 or older
by 2030
Age UK
In 2015
people from
the leastadvantaged
fifth
of the UK were
80%
more likely to die
than those from
the mostadvantaged
fifth
Legal & General
Adobestock
The state pension age must be
raised to prevent social security
becoming “unaffordable”, according
to Patrick Spencer, head of the work
and welfare unit at think tank Centre
for Social Justice (CSJ).
At the end of August the think tank
proposed that the state pension age
should rise to 75 over the next 16
years, in line with a rise in life
expectancy. It recommended that the
retirement age should go up to 70
nine years from now, as the change is
phased in.
While there are no formal plans to
introduce the recommendation as
policy, the think tank’s previous ideas
have proven influential. The CSJ laid
out the blueprint for Universal Credit
in 2009, which was rolled out in 2013.
“The proportion of people who are
over the age of the state pension has
doubled. This presents us with a
number of economic issues, not least
the fact that we will no longer be able
to afford a social security system,”
Spencer told HR magazine.
However, research has shown that
life expectancy varies according to
location and socioeconomic group.
Men living in the least-deprived
10% of areas in England and Wales
in 2014-16 could expect to live
almost a decade (9.3 years) longer
than those in the most-deprived 10%
of areas, according to health charity
The King’s Fund. The gap was 7.4
years for women.
Will Stronge, co-director of think
tank Autonomy, said the CSJ’s proposal
is morally and economically flawed.
“Why are we talking about using
older people as an economic boost,
and not about better technologies?”
he asked. “We have some of the
lowest levels of investment in
robotics and machinery in the
EU. It doesn’t make sense as an
industrial strategy to put over-65s,
who will often be quite frail, back
in to work again.”
Stronge called on employers to be
vocal in questioning the proposal:
“Everyone’s going to retire at some
point, and even CEOs should be
saying ‘we don’t want a future where
we’re working until we’re 75’. This
is in the interests of everyone.
Employers have an important part to
play in how society functions.”
Adapting to an ageing workforce is
a mounting concern for the HR
profession. Research last year by the
Centre for Ageing Better found a
quarter of employers (24%) feel
unprepared for the growing number
of older workers.
Kate Silver, director of people at
housing and social care charity The
Royal Star & Garter Homes, agreed
that raising the state pension age
would be bad news for employers:
“It’s absolutely clear we need to look
seriously at the challenges of an
older workforce. We know that
ageism is acting as a barrier for older
people at work,” she said.
“But there shouldn’t be confusion
between allowing people to work
longer and forcing people to do so,
which is nothing other than unfair.
The pressure on HR and employers
would be immense. You can’t be
expected to facilitate people to work
when at that age many of them just
won’t be physically fit enough.”
Spencer commented that raising
the pension age won’t be effective
without other policies in place: “It
will only work if we provide more
access to occupational health,
flexible working and training, and
better workplace infrastructure.
These things are hugely important.”
He added that the ethics of this
issue are “complicated”. “There is
more to being compassionate than
just pumping more money in to the
social security system,” he said.
“Compassion can also be about
creating an economy and society
where people aren’t faced with
feeling like they don’t want to or
can’t work.”
But Stronge predicted that such a
policy could be disastrous for the
Conservative party: “If you seriously
proposed a future of work where
people would have to work for an
extra 10 to 15 years… This could
be on the level of the poll tax that
ended Margaret Thatcher.”
Spencer argued the public would
respect the move, however: “Do I
think there is a political cost to this?
I don’t. This isn’t about working
until you drop, or squeezing out
more tax revenue. It’s about creating
an economy that is more prosperous
and a society that is richer.
“People respect the fact that this
is a reality… and it’s the right thing
to do.” HR
hrmagazine.co.uk October 2019 HR 5
/hrmagazine.co.uk