Working beyond 65 ‘should not be law’

Plans to allow people to continue working after the age of 65 should not be made compulsory, the head of the Pension Authority said yesterday.
Working beyond 65 ‘should not be law’

David Begg said the retirement age was a matter for employers and any changes would need to take into account what people did for a living.

Mr Begg, who is chairman of the authority, said some practical difficulties would have to be confronted and employers would have to decide what they were willing to do.

“You can’t do this by any form of compulsion — that would not work,” he said on RTÉ radio yesterday.

Mr Begg said people could be given incentives to stay at work. Employees could be encouraged to take their old age pension a bit later by having it adjusted to a higher level.

The business group, Ibec, said setting a contractual retirement date must ultimately remain a matter between employers and employees.

Welcoming the Government’s pensions report, Ibec head of social policy, Tony Donohoe, said businesses shared the objective of facilitating longer working lives.

But, he said, a balance had to be struck between the needs of companies to have certainty and flexibility over workforce planning and the viability of their business.

“At a time when youth unemployment is still above 18% the considerations of longer working also need to be balanced with the need to ensure adequate employment opportunities for young people and the need to provide career progression pathways,” said Mr Donohoe. Age Action pointed out that there were no proposals in the report to address the situation occurring every year where older workers were forced out of their jobs and onto the dole because of mandatory retirement ages.

Siptu president, Jack O’Connor, said Ireland was almost unique in the developed world because it did not have a pension scheme requiring mandatory contributions by employers, government and employees.

“Instead of abolishing the Universal Social Charge, we should be redeploying it in this direction,” he said.

Speaking yesterday on RTÉ radio, Mr O’Connor said the political will to have such a pension scheme did not exist.

“You could paper the walls of Liberty Hall with the white papers and the green papers and the reports and the rest of it — all of them pointing in the one direction.”

Mr O’Connor described the pensions report as “useless window dressing” because it failed to deal with the significant aspects of the developing pensions’ crisis.

“There is a major crisis unfolding in the retirement and pensions arena. If it isn’t tackled, it will ultimately rank second only to the banking crisis of 2008 in terms of severity and economic implications.

“We deserve more from our elected legislators than the kind of hand-wringing that is displayed in this useless report.”

Chief executive of the Irish Association of Pension Funds, Jerry Moriarty, also speaking on RTÉ radio, said current taxation and PRSI contributions were funding Ireland’s state pension. “That’s already running at a deficit,” he warned.

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