Again, the proposal has been inspired by European law. The Government believes that the law on retirement may have to be changed to comply with EU anti-discrimination rules. The CBI, which seems to have a blanket policy of resisting everything that emerges from Brussels, is insistent that employers must be free to set an age at which their employees must retire.
Only this way, it says, will employers be able to plan for their recruitment needs. Moreover, it says, companies might be forced to dismiss rather than retire under-performing older workers. It fears this could mean increased litigation as has happened in the US, Australia and New Zealand, where compulsory retirement has already been removed.
There doesnt seem to be much consistency in the CBIs approach. The proposals for temporary workers would increase regulation, but the removal of an employers right to set a retirement age for employees could be interpreted as a deregulatory measure and employers are supposed to favour deregulation, arent they? The British Chambers of Commerce, representing small business, has no problem with the proposal which could be adopted by 2006.
Katja Klasson, the CBIs head of employee relations, rejects the idea that mandatory retirement should be viewed in the same way as other forms of discrimination. Sometimes it is justified to treat someone differently because of their age, she says.
If she meant that we should treat older employees with greater respect, recognise their experience and tap their expertise, either in a mentoring, training or coaching role, I would applaud her sense of vision. But she does not mean this. What she does mean, I think, is that we must recognise that people have less vim and fizz as they get older.
In fact, some 70-year-olds can work more productively than people 30 years younger. The idea that people develop and mature at set ages is nonsense. Of course you cannot hold back the years forever, but some changes are not necessarily for the worse.
Look at the dear departed Queen Mum performing ceremonial roles well into her 101st year. In terms of crowd pulling, she was, to quote the late Princess of Wales, real box office. Then there is the Prince of Wales who wouldnt get much time to sit on the throne if he had to go at 65. Some jobs in society are above retirement rules. God alone can retire the Pope.
However we all know that these examples do not reflect the kind of worker the CBI has in mind. It is most concerned with rank-and-file employees. It cant be worried about ageing middle managers because they tend to be cleared out in early retirement deals these days well before they reach their 60s.
I have not met one retired person who did not comment on the artificiality of sudden, forced retirement. Some have been wheezing up to the line for years, wishing they could work less or differently. Others feel fit enough to go on as they are for another five years or more.
There is something of the flat Earther in the CBI stance. Has it not looked at demographic projections recently? The fertility rate in every developed country has fallen below the replacement rate of 2.1 children. In the UK, between 1995 and 2000, according to United Nations statistics, it was 1.7. In Germany the rate is 1.3. This means declining labour forces by the 2010s. In this kind of society we shall not be retiring the over-60s but competing for their services.
There is one kernel of sense in the CBIs approach, and that is the suggested reform of Inland Revenue rules so that employees could draw partial pensions while working reduced hours. Such initiatives would provide scope for more flexibility as people get older. Choice, not compulsion, should be the basis of future labour market reform.
richard.donkin@haynet.com
Richard Donkin is employment columnist at the Financial Times
