Julian Knight: Pension timebomb? Call the forces of political correctness

You work longer and you pay more – you probably knew the drill before Lord Hutton released his report into public sector pensions last week.

But beyond the ire of the unions and the feeling that the Hutton report is a staging post to even lower retirement provision, there is an even bigger problem waiting to be tackled – how do we keep people in the workforce for longer?

Right now, public sector employers are plotting how they can "manage out" older staff, as part of the cuts programme. Either because they are seen as unproductive, difficult to train and prone to long-term sickness or simply because getting rid of someone in their late fifties or early sixties is seen as less damaging than getting rid of someone who has "their whole life in front of them".

Of late, we have had some bizarre commentaries, from, among others, the BBC's economics editor, Stephanie Flanders, that older workers are standing in the way of younger graduates and need to make way. The implication is that graduates and older workers are going for the same jobs, which isn't the case. Although the Office for National Statistics does say that the number of people in employment over the age of 65 has risen a touch, we are still in danger of reliving the mistakes of the 1980s and early 1990s recessions when generations of workers over the age of 50 were scrapped.

More widely, we have ageist employment practices. There have been countless "mystery shopping" exercises where CVs from older people were rejected in favour of the same CVs from candidates who did not give a date of birth. No wonder around half of all men over 60 and two-thirds of women – who often have to care for elderly relatives – are "economically inactive".

Most don't want to be on benefits or living off redundancy, property and savings. They want to work. But their way is blocked by ageist employers (many managers can't imagine managing someone 30 years their senior, and have a complete misconception of older people's sickness and adaptability to train) and, in many instances, lack of confidence. If society tells you that you are on the scrap heap then that's where most likely you will bed down.

Getting people to stay at work is the only way to square the pensions circle. To do this we need a fundamental change in society. In many respects, we need what the Daily Mail would no doubt call the '"forces of political correctness" to make ageist hiring and firing as unacceptable as prejudice on the basis of race, gender or sexuality. After all, is it any less hurtful to be unable to work because of the date on your birth certificate, than because of who you sleep with or your racial origin? Language itself has to change, from job adverts to conversations by the office water-cooler. We have to get serious about ageism if we are to have any chance of relieving the pensions crisis.

Did you make the most of low interest rates?

£8,798 is how much you could have knocked off a £150,000 mortgage debt if during the past two years of low interest rates you'd been systematically overpaying. All the average £150,000 borrower needs to have done – according to the number crunchers at broker firm London & Country – is to have kept the monthly repayment at the same level as in early 2009. This would also have had the twin benefits of pushing down the loan to-value ratio – negating some or all of the recent house price fall – making it easier to remortgage or even, if you have a flexible loan, allowing you to take a payment holiday should you need one in the future.

Now, with interest rates almost certain to rise soon and National Insurance going up next month, the golden period of higher disposable incomes for those with jobs and a mortgage tied to the base rate is drawing to a close. So how have you done and what is the size of your mortgage today?

Independent Partners; request a free guide on NISAs from Hargreaves Lansdown

PROMOTED VIDEO
Arts and Entertainment
tv
Sport
Ojo Onaolapo celebrates winning the bronze medal
commonwealth games
Arts and Entertainment
Rock band Led Zeppelin in the early 1970s
musicLed Zeppelin to release alternative Stairway To Heaven after 43 years
Arts and Entertainment
Tracey Emin's 'My Bed' is returning to the Tate more than 15 years after it first caused shockwaves at the gallery
artTracey Emin's bed returns to the Tate after record sale
Environment
Neil Young performing at Hyde Park, London, earlier this month
environment
News
i100
News
Prince Harry is clearing enjoying the Commonwealth Games judging by this photo
people(a real one this time)
Sport
Lionel Messi looks on at the end of the final
football
Extras
indybest
News
Richard Norris in GQ
mediaGQ features photo shoot with man who underwent full face transplant
News
Gardai wait for the naked man, who had gone for a skinny dip in Belfast Lough
newsTwo skinny dippers threatened with inclusion on sex offenders’ register as naturists criminalised
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Project Manager (HR)- Bristol - Upto £400 p/day

    £350 - £400 per annum + competitive: Orgtel: Project Manager (specializing in ...

    Graduate / Trainee Recruitment Consultant - IT

    £25000 per annum + OTE £40,000: SThree: Orgtel are seeking Graduate Trainee Re...

    HR Business Partner - Banking Finance - Brentwood - £45K

    £45000 per annum + Benefits: Ashdown Group: ** HR Business Partner - Senior H...

    PA / Team Secretary - Wimbledon

    £28000 - £32000 per annum + Benefits: Ashdown Group: PA / Team Secretary - Mat...

    Day In a Page

    The children were playing in the street with toy guns. The air strikes were tragically real

    The air strikes were tragically real

    The children were playing in the street with toy guns
    Boozy, ignorant, intolerant, but very polite – The British, as others see us

    Britain as others see us

    Boozy, ignorant, intolerant, but very polite
    Countries that don’t survey their tigers risk losing them altogether

    Countries that don’t survey their tigers risk losing them

    Jonathon Porritt sounds the alarm
    How did our legends really begin?

    How did our legends really begin?

    Applying the theory of evolution to the world's many mythologies
    Watch out: Lambrusco is back on the menu

    Lambrusco is back on the menu

    Naff Seventies corner-shop staple is this year's Aperol Spritz
    A new Russian revolution: Cracks start to appear in Putin’s Kremlin power bloc

    A new Russian revolution

    Cracks start to appear in Putin’s Kremlin power bloc
    Eugene de Kock: Apartheid’s sadistic killer that his country cannot forgive

    Apartheid’s sadistic killer that his country cannot forgive

    The debate rages in South Africa over whether Eugene de Kock should ever be released from jail
    Standing my ground: If sitting is bad for your health, what happens when you stay on your feet for a whole month?

    Standing my ground

    If sitting is bad for your health, what happens when you stay on your feet for a whole month?
    Commonwealth Games 2014: Dai Greene prays for chance to rebuild after injury agony

    Greene prays for chance to rebuild after injury agony

    Welsh hurdler was World, European and Commonwealth champion, but then the injuries crept in
    Israel-Gaza conflict: Secret report helps Israelis to hide facts

    Patrick Cockburn: Secret report helps Israel to hide facts

    The slickness of Israel's spokesmen is rooted in directions set down by pollster Frank Luntz
    The man who dared to go on holiday

    The man who dared to go on holiday

    New York's mayor has taken a vacation - in a nation that has still to enforce paid leave, it caused quite a stir, reports Rupert Cornwell
    Best comedians: How the professionals go about their funny business, from Sarah Millican to Marcus Brigstocke

    Best comedians: How the professionals go about their funny business

    For all those wanting to know how stand-ups keep standing, here are some of the best moments
    The Guest List 2014: Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks

    The Guest List 2014

    Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks
    Jokes on Hollywood: 'With comedy film audiences shrinking, it’s time to move on'

    Jokes on Hollywood

    With comedy film audiences shrinking, it’s time to move on