Blunkett reignites the pensions debate

Forcing people to save for their retirement returned to the Government's agenda yesterday when David Blunkett said all options for solving the pensions crisis would be considered.

Forcing people to save for their retirement returned to the Government's agenda yesterday when David Blunkett said all options for solving the pensions crisis would be considered.

The new Secretary of State for Work and Pensions, who returned to the Cabinet in Friday's post-election shuffle, refused to rule out a compulsory system. "There are no off-limits here," he said. "We have got to be able to address, quickly and decisively, where we are going."

Gordon Brown, the Chancellor, who fears that a compulsory scheme would be seen as a tax, said during the election that such a proposal would have to be included in Labour's manifesto at the next election before being implemented.

Mr Blunkett is to meet Adair Turner, the chairman of the Pensions Commission, later this week. The former CBI boss is not due to report until this autumn, but in his interim report last year he hinted that compulsion might be needed.

Mr Blunkett said on the BBC's Breakfast with Frost programme: "I want to build a consensus so I want, with Adair Turner, to reach out to the other major political parties. We need a lasting solution for the decades ahead, not a quick fix."

Mr Blunkett outlined the "enormity" of the problem. "Fifty years ago, people, on the whole, lived 10 years after retirement, and retirement was, on average, at the age of 67. Now people live, on average, 20 years longer. They want to retire earlier. The average age of retirement is below 65.

"A hundred years ago when we started today's pensions scheme, there were 10 people in work for every one in retirement. In the middle of this century, there will be two people in work for every one in retirement."