‘Removing the default retirement age will damage business’

The British Chambers of Commerce and the Confederation of British Industry have hit out against the government’s proposal to remove the default retirement age.

Adam Marshall director of policy at the BCC says the move will restrict businesses’ ability to manage their workforce: ‘[Companies] agree that the DRA is currently too low and needs to rise for both deficit reduction and fairness reasons. But if ministers want to make a positive change, they should either raise the DRA in line with the state pension age or offer employers a new dismissal route that helps business manage their workforce regardless of age.’

John Cridland, deputy director-general at the CBI, says: ‘Removing the default retirement age would cause significant practical problems for employers. Both companies and staff benefit from having a clear framework for the timing of retirement.’

In a speech this morning, secretary of state for work and pensions, Iain Duncan Smith, said: ‘People are living longer and healthier lives than ever, and the last thing we want is to lose their talent and enthusiasm from the workplace due to an arbitrary age limit.’

In his Budget, George Osborne pledged to introduce the new pension age of 66 ahead of 2024. Reports suggest that the new pension age may come into force by 2016.

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Default Retirement Age

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