Retirement age set to rise to 67

WORKERS currently under the age of 50 may not be able to retire until they are 67, a new report revealed today.

Recommendations by the Pension's Commission suggest the retirement age is raised from 65 to 67 in order to ensure that people are given a more generous state pension.

A Suffolk business leader today expressed his concern at the strain this could put on smaller businesses.

Bob Feltwell, chief executive of the Suffolk Chamber of Commerce, said: “There should not be an obligation on employers to comply with a range of laws once people are over 65, when their skills and technical abilities are diminishing.

“It is not fair on small businesses to have to continue employing people up to the age of 67 if they are not efficient, because we have to compete in a global market.

“It's not ageist. It's too do with the skills and abilities of people.”

He also voiced his concern at the gap between private and public sector companies, where the current retirement age is 60.

He said: “The government has failed to increase the pension age for public sector workers.

“That needs to be addressed as a matter of urgency.

“At the moment the private sector is paying for those in the public sector to have an early retirement.”

The commission's report was leaked in a national newspaper yesterday, but will not be officially published until November 30.

Other expected recommendations include a new national savings plan in which people will automatically be enrolled when they start a job, with the right to opt out.

The state pension should also be closer to the £109-a-week means-tested minimum income guarantee rather than an £80-a-week basic state pension.

The pension should rise in line with earnings, not just prices, and the changes will be phased in after 2020.