None of us can claim to be experts on any subject (although many do). However, I do claim that I know enough about working on into old age to be able to make a few comments from experience. After all, I have yet properly to retire at 75 although I do take things rather more gently than I did when I was younger.
This all started when Dr Alf posted a blog. It is called “Older, healthier and working: Britons say no to retirement.” Here is an extract:
There are still lots of taboos and sensitivities about older people but it’s necessary to face up to the economic and social realities.
The percentage of the older “indigenous population” in many countries will grow alarmingly over coming decades. Apart from shifting the older people overseas, like Germany for example, the only way that the balance of younger people will be preserved will be with continued large scale immigration.
Because of UK Government policy under the previous Labour Government, many retiring peoples’ pension pots are much smaller than envisioned. More widely, Western governments have struggled with the political complexities of adjusting pension policies to reflect the changing domographics.
So older people, will typically have smaller savings and pensions, so they are faced with real decisions:
Turn to their family?
Turn to the state?
Turn to themselves?
Of course, as the article describes, there are many older people who will be delighted to continue working, given the chance, but this fails to address the vast majority. Surely, the vast majority will be not have the skills, competence, stamina, and health to continue working?
Let me turn this around to an open question:
How should Government policy change to give older people a greater chance of working in their later years, addressing issues of skills, competence, stamina and health?
The first thing to say is that “older people” is too vague. People (of all ages) vary enormously from the very willing and fully able to those who would rather not (thank you very much) and those who would love to but just can’t. Thus we have two variable to consider – and every “older person” sits in a place which may not be unique but is pretty much their own.
So how can a government deal with this degree of variation? Well, it can’t. I hope you agree with that statement – especially those of you who already know that I have serious doubts about government being able properly to deal with anything very much. However, it can remove a few of the obstacles and maybe add in a few incentives. Here are the few things that I would suggest could be done.
- Remove NI contributions (employee and employer) on all employees over retirement age
- Double the tax threshold for people who are over retirement age and who work for twelve or more hours per week but continue to include their state pensions into their taxable income.
- ensure that employers have the right to lay off all those over retirement age without giving any reason but with a minimum of either four week’s notice or a payment equal to the amount earned in the previous four week period.
Before raising your hands in horror, think of the advantages. This will encourage employers to take on old people and encourage old people to work, if only part time. Isn’t that the object of the exercise?
It does nothing for those who are over retirement age but self-employed (as I am) but then, we don’t need to be encouraged. We just get on with it.