PRIME Initiative

Here we go again. George Osborne has announced plans at the Conservative Party conference to make us all keep working longer before we can draw our State Pensions. While this might a seem logical way to save public money it misses the same key point as most similar proposals to raise pension age. It assumes there are going to be jobs there for these older workers to do. In reality it is probable that almost half will be out of work.

So for many people it will simply mean moving from drawing their pension to drawing an out-of-work benefit. Where’s the saving in that?

Let’s be clear. I have no problem with the idea of working for a bit longer. In fact there’s a lot of positive things to be said for it. It would probably lead to a generally better standard of health, and many people would a welcome a chance to stay ‘connected’ and contribute to society for longer. And of course, there’s the financial benefits.

But the tricky bit is finding the jobs. So, at the moment, George Osborne has only half a policy. The difficult bit is missing.

The fundamental point that George Osborne seems to have missed is that alongside the proposed changes to State Pension Age, interventions are required to help older workers to stay in, or get back into, work – and these interventions come at a cost.

According to the last census, economic activity rates for workers during the five years immediately before retirement were only 58% for women, and 52% for men – and these figures are likely to have been worsened by the recession.

So what we really need from the Conservatives are some really innovative proposals that give older workers real support in finding sustainable work opportunities. Given the poor track record most companies have in hiring older workers, these proposals will have to include self-employment. This is how currently how over a third (35%) of 65 year-olds choose to work (source: ONS 2001 Census).

Full text of George Osborne’s speech