UK manufacturers call for standard retirement at 65

November 13 2004 - EEF, the manufacturers' organisation, wants the UK Government to set a standard retirement age of 65 when EU legislation on age discrimination is introduced in October 2006. The request is based on a major survey of British businesses published the EEF and Aon Consulting, a leading pensions, benefits and HR consulting firm.

The manufacturers' organisation produced its report ahead of what is probably the final meeting this week of the Government's Retirement Age Taskforce, set up to recommend retirement age policies when age discrimination legislation is introduced. Two thirds of the 525-plus companies of all sizes that responded to the survey favoured a standard retirement age of 65.Only a quarter of respondents wanted the age to be set at 70 with even fewer voting for no standard retirement age at all.

The survey showed also that, contrary to popular belief, many manufacturing businesses currently employ some older workers. A quarter of respondents said they already have some full-time employees over their company's normal retirement age, which in the vast majority of cases was 65, and nearly a third of them had some part-time employees over 65.

EEF say that they support the principle of age discrimination legislation, but they believe that these figures back the view that the Government should continue to encourage a voluntary approach to the employment of older workers rather than introduce this legislation in a way that would create additional costs and administrative burdens for employers.

EEF Deputy Director of Employment Policy, David Yeandle, said:

"These results confirm that there is strong support amongst manufacturing companies for having a standard retirement age of 65 when age discrimination legislation is introduced. However, the number of manufacturing companies employing full-time or part-time employees beyond their normal retirement age suggests that employers and their older employees are agreeing voluntary arrangements which are felt to be mutually beneficial."

"The Government is already pursuing a positive approach to the culture change that is needed to encourage the employment of older employees though its Age Positive programme. This approach is the right way forward and is likely to receive far greater support from employers than introducing age discrimination legislation in a way that creates complex and expensive problems for employers."

The survey also showed that almost 90% of manufacturing companies wanted the state pension age to remain at 65 after 2020.

Paul McGlone, Principal and Actuary, Aon Consulting, commented:

"These figures show clearly that, while there may be a developing consensus among pension experts that the state pension age should rise, this view is not accepted in the wider community. Before this government or any government can increase the state pension age a significant amount of persuasion still needs to be done."

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