Million over-50s urged to return to jobs

30-03-2005

Labour bids to tackle the pensions problem - and win over the 'grey voters'. A million older people are to be targeted to return to work, under government plans to tackle the demographic time bomb of an ageing population.

Alan Johnson, the Work and Pensions Secretary, warned it was time to recognise that sixtysomethings were 'not in your dotage' and still capable of doing high-powered jobs.

'We need to stop encouraging people that the earlier you get out of employment the better,' he said, ahead of a summit of the G8 group of industrialised nations on the challenges of an ageing population. 'The inducements are for people to just leave the workplace with a lump of money in their forties and fifties. We can't afford it in pension funds, society can't afford it.'

Calling for a culture change to stamp out ageism at work, he added: 'When you get to 65, people are remarkably youthful and energetic and have got lots of ideas. This whole view of people that when they get to 65 they are only fit to do a few simple clerical jobs is wrong.'

In a separate move, Education Secretary Ruth Kelly is to encourage over-55s to go back to university by scrapping the age limits on who can apply for a student loan. The move is a sign of how seriously the 'grey vote' is being taken in Downing Street.

This week's Budget is expected to emphasise new training opportunities for all ages, including over-55s, and highlight the Chancellor's goal of getting 80 per cent of adults into work, his definition of full employment. Raising employment rates is regarded as crucial to support an ageing population and avoid wasting talent.

But to reach that target, up to a million over-50s who are currently not working - having struggled to find a job because of ageism, or because they retired early, or have reached pensionable age - will need to be coaxed back into jobs, Johnson said.

He has ruled out raising the state pensionable age, but from next month new incentives will kick in to persuade people to work longer. Those who carry on beyond state pensionable age will be able to defer their pension and collect it when they finally retire: a man who works until he is 70 could get either a �10,000 lump sum or 50 per cent higher weekly pension payments as a result.

However, the debate comes at an awkward time for ministers, who face a revolt from their own civil servants over plans to raise pensionable ages across the public services from 60 to 65, in line with the general population.

The senior civil service union, the FDA, is expected to announce tomorrow that its members have voted to strike over the issue at the end of this month, just days before the general election campaign is expected to be launched: local government officials represented by Amicus, T&G, Ucatt and Unison also voted last week to strike.

But Johnson said the change to pensionable age was 'non-negotiable', adding: 'Why should we be lecturing the private sector about the need to work longer, when the public sector has the retirement age for the civil service, [which] was set 200 years ago, at 60?'

The plans to encourage pensioners to go to university will be unveiled this month by Tony Blair as part of a package of measures to woo older voters.

'University should be for everyone who has the ability, regardless of background and age: you can't have a funding system that bars people from getting support simply because they are in their late fifties,' said a Department for Education and Skills official.

Currently, only those under 54 can apply for a student loan. Older students would not have to repay the loan until they earned �15,000 a year - meaning, if they were on a limited pension, they could get away with three years' free tuition fees.

Demographic changes not only in the UK but across Europe have been prompted by the ageing of the postwar 'Baby Boomer' generation, now nearing retirement, combined with longer life expectancy and a falling birth rate.

Gaby Hinsliff, political editor

The Observer

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