Comprehensive strategies for active ageing - mutual learning ...

SUMMARY
– Adjusting pension systems to discourage early retirement
– Initiatives by the social partners
Conclusions
Jaap de Koning concluded that population ageing will almost certainly entail economic problems. Since many of
the effects mentioned above will depend on the behavioural reactions of employers and workers, it is difficult to
predict the extent of these problems. He reiterated the need for reducing incentives to early retirement and
raising the incentives to remain in work or return to work among the 50-65 year-olds. He emphasised the need
to complement incentives to employees with incentives to employers to take on or keep on older workers. He
pointed out that empirical evaluations show that active labour market measures can also be very effective for
this age group. Finally, he stated that further research was needed into the interaction between measures and
their unintended side-effects.
4. Country examples – the United Kingdom and the Netherlands
The country examples of the United Kingdom and the Netherlands had the specific aim of complementing the
introductory paper by Jaap de Koning. The UK example focused on the British strategy of extending working life
and the Dutch example concentrated on policies in the Netherlands aimed at improving the financial incentives
for workers to retire later and for employers to retain older workers.
4.1 The United Kingdom
The UK strategy for extending working life was presented by James Elder from the Department for Work and
Pensions. Of the 8.8 million people aged between 50 and state pension age 3 , 70.7% are in employment (a high
rate compared with the European average), 2.1% are unemployed, and 27.2% are inactive. 1.7million of this
group are claiming benefits. A relatively high proportion of those people over 50 in employment are selfemployed.
The evidence suggests that, in Britain, the decision to retire is largely a financial one and one taken
at a household level with couples typically wanting to retire at the same time. There are marked regional
differences in the employment rates of older people between, with the regions traditionally dominated by heavy
industry (e.g. the North-East) have the lowest employment rates for people aged 50-plus , and the South-East
and the South-West the highest. James Elder posed the question of why older people have lower than average
employment rates, and argued that like most countries in the EU, the UK had, until recently, a culture of early
retirement, which has only recently begun to be eroded. It is also no longer attractive for companies to
restructure using early retirement as a tool and it is more difficult for workers to claim sickness and incapacity
benefits. Age discrimination is still prevalent and endemic, however, and was described as 'the last sociallytolerated
form of discrimination' in the UK. The caring roles of older workers (e.g. for ageing parents) should also
not be underestimated as a factor contributing to their lower employment rates.
Research shows that the reasons older people tend to give for early labour market exit are ill-health (46%),
redundancy (16%) and to spend time with partner or family (11%). A high proportion do not leave the labour
market through their own wishes, however, and 60% are involuntarily out of work.
The reasons older people give for not seeking work are mainly health reasons (50%), because they regard
themselves as retired or because financially they do not need to work (22%), care duties (12%) and inability to
find a job (2%).
3 i.e. 50-64 for men and 50-59 for women.
20 April 2005 Thematic Review Seminar Comprehensive strategies for active ageing
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