Mandatory retirement age may be abolished

Mandatory retirement age may be abolished

The Citizens’ Assembly is to tell the Government to abolish mandatory retirement ages, eliminate the time gap between retirement and eligibility for the old age pension, and to link that pension to average earnings, writes Caroline O’Doherty.

The recommendations follow a weekend of hearings at which the assembly discussed a wide range of issues to do with income, work, and pensions for older people.

Sixteen proposed recommendations were voted on and will form the basis for a detailed report to be sent to the Dáil and Seanad.

On the question of abolishing mandatory retirement ages, 86% of the assembly members present said this practice should be outlawed, while 96% said the anomaly whereby people who are forced to retire at 65 but can not get the State pension until they are 66 should be removed.

A recommendation to seek the introduction of some form of mandatory pension scheme to supplement the state pension was backed by 87%, and 88% said the pension should be benchmarked to average earnings.

A large majority also voted to recommend the rationalisation of private pension schemes.

On general issues of care for older people, the majority voted to recommend the allocation of more resources, with the preference that funding be ringfenced and come from a compulsory social insurance payment.

They want that money spent primarily on improved home care services and supports, and want statutory regulation of the home care sector.

Assembly chairwoman Ms Justice Mary Laffoy said she aims to have the report written and ready for the Oireachtas by the end of September.

The recommendations were decided following presentations by experts in law, finance, social care, and human rights, but not all the ideas put forward made the final cut.

Earlier, the assembly heard from Micheal Collins, assistant professor of social policy at University College Dublin, who suggested a radical change in policy to end tax breaks for people who invest in private pensions.

He said State pensions were the most important source of income for retired people in Ireland, accounting for 53% of their income as compared to 32% from private and occupational pensions.

“The policy of supporting private pension provision through tax breaks is skewed towards those on higher incomes,” said Prof Collins.

“It is worth considering whether society should more efficiently use its resources to provide an improved basic living standard for all pensions, one well above the minimum income standard, and discontinue subsidising private pensions savings.”

Justin Moran of Age Action and Ita Mangan of Age and Opportunity argued strongly for the abolition of mandatory retirement ages, and UCD professor Liam Delaney warned that any move towards mandatory pension enrolment for workers should first examine the likely impact on wages, on administrative burdens for small businesses, and on other forms of financial provision that people made for their future such as investments. None of these impacts had “off-the-shelf answers”, he warned.

The assembly will next meet in September to discuss what Ireland should do about climate change.

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