Employers want default retirement age reinstated

Depressingly – but not unsurprisingly – a recent survey conducted by law firm, Eversheds, reveals that nearly half of employers would like the default retirement age (DRA) reinstated.

The survey revealed that a third of employers felt the abolition of the DRA has had a negative or very negative impact on their organisation: two-thirds cited difficulties in succession planning whilst just under half reported that opportunities were being blocked for younger workers.

Other implications included increased costs of redundancies and/or providing benefits (37%), more management time having to be spent on performance management (29%), whilst just over a fifth reported an increase in ill-health absence.

Unfortunately, older workers aren’t going to go away so employers will just have to accept that these are now facts of working life.

One wonders if it was the way the survey was worded and the way the results are being reported, but didn’t the other half (who don’t want DRA reinstated) have anything positive to say about older workers?

Some good news media support would go some way to supporting the cause of older workers and overcoming negative perceptions amongst the unconverted

See: http://www.workplacelaw.net/content/46850

Unready for ageing

Although there is nothing new in the House of Lord’s “Ready for Ageing” report published yesterday, it is a useful summary of the issues which our society now faces in relation to changing demographics. And, as the report highlights, it is not just society’s problem, or the government’s, but one about which we must all take greater personal responsibility.

The report recommends, amongst much else, that the 2015 government establishes two Commissions – one to consider the financial aspects of our ageing population and the other to focus on health and social care. However, having pointed out elsewhere in the report that employer and societal attitudes – and lack of flexibility – continue to impact older people’s ability to work longer, I believe there should also be a third Commission to focus urgently on this aspect.

We need a change in attitudes overall to ensure that older people aren’t seen as dependent, needy and a liability but are recognised for what the majority are – active, contributing citizens. Let’s hope that this report leads to action – and isn’t just yesterday’s news.

The report can be downloaded here: http://www.publications.parliament.uk/pa/ld201213/ldselect/ldpublic/140/140.pdf 

It can also be browsed here: http://www.publications.parliament.uk/pa/ld201213/ldselect/ldpublic/140/14002.htm

The Psychology of Retirement

 

These days the line between work and retirement is increasingly difficult to define. How, when and in what manner it occurs is less certain than in the past. Its very meaning has changed with many people continuing to work even though they claim to have ‘retired’.

And, despite its inevitability in one form or another, many individuals still fail to plan adequately for its arrival. For example, a new report from financial services company MGM Advantage claims that “three in five (60%) over 55s admit to being unprepared for retirement”.

Thus the relevance to those interested in older workers of a valuable and interesting new book: The Psychology of Retirement – coping with the transition from work*. It is written by Derek Milne who retired as the Director of the Newcastle University Doctorate in Clinical Psychology training programme in 2012.

Unlike most other guides to retirement which tend to deal with the practicalities of growing older outside of full-time work, this enlightening handbook tackles the unspoken issue that many people find the transition to a happy and fulfilling retirement difficult and stressful.

In response, the book draws on proven psychological coping strategies to aid the process of coping with retirement, ensuring that individuals are able to gain a better understanding of the realities of retirement and maximize their enjoyment of a key period of life.

Incorporating the author’s personal experience, real-life case studies, the latest research and well-established theories, The Psychology of Retirement provides many insights and much food for thought concerning the nature of retirement and the new challenges and opportunities it represents.

* published by Wiley (February 2013).

MGM’s Retirement Nation Report 2012: http://www.mgmadvantage.co.uk/island/wp-content/uploads/2012/11/Retirement-Nation-2012.pdf

The flat rate pension finally arrives.

At long last, and after many years of stalling, we are now close to having a flat rate, single tier state pension system. There has obviously been much coverage in the media and from various charity and support groups.

On the plus side they have highlighted how this will simplify an antiquated and largely unintelligible system so complicated and intrusive that many potential beneficiaries have chosen not to claim what they are entitled to. They have also drawn our attention to the transitional arrangements which are necessary and in which some people will appear to be winners and some losers (against expectations rather than against fact?). This is fine and necessary to make sure that in the changeover process all obvious inequities are dealt with and corrected.

As with all political initiatives such as this, first we get the good news regarding the move to a flat rate pension and then the not-so-good news that National Insurance contributions will have to increase to fund some of it. This does rather take the icing off the cake.

More worrying, though, are the views, already being expressed, that firstly the state pension is not enough (which we know or should do) and, linked to this, that not everyone should get this flat rate pension, that is a return to means testing. I had thought that for once, at long last, people had started to look at our demographic shift and its implications in a more statesmanlike fashion devoid of entrenched short term party politics – but it seems this is a very optimistic hope.

Such views totally miss the long term point of the changes. The flat rate state pension will never be enough on its own unless we tax people out of existence. However, by underpinning personal savings with this pension and then not confiscating it once individuals start to save for themselves we can give people the responsibility, the scope and the encouragement to plan themselves for their own financial well-being according to their own needs, choices and timeframes. And in what manner they choose, be it pensions, properties or direct investment.

A great step forward in upskilling for older workers?

Interesting and potentially exciting news at the end of 2012 that a group of established UK learning institutions are joining forces to enter the world of MOOC provision. For the uninitiated (which, until reading this article, included me) MOOCs are ‘massive open online courses’ – training courses that typically free, conducted online and open to anyone who wants to participate

In 2013 12 UK universities will be getting together to form a new company that will offer the online courses – under the brand name of FutureLearn Ltd. The universities are: Birmingham, Bristol, Cardiff, East Anglia, Exeter, King’s College London, Lancaster, Leeds, Southampton, St Andrews and Warwick, along with UK distance-learning organization The Open University (OU).

Several U.S. universities including Harvard and MIT are already involved with MOOCs as are a few other UK universities but this will apparently be the first large group to set up a dedicated MOOC business located in the UK.

Details of courses and operations are yet to be finalised but the OU said FutureLearn will be open to students in the UK and internationally. It will:

• bring together a range of free, open, online courses from leading UK universities, that will be clear, simple to use, and accessible.
• draw on the OU’s expertise in delivering distance learning and pioneering open education resources to underpin a unified, coherent offer from all of its partners.
• reimagine class-based learning rather than trying to replicate it online – using the potential of digital technologies.

Commenting on the development, Martin Bean, the Vice Chancellor of The Open University said: “MOOCs represent an enormous development in higher education, one that has the potential to bring about long-lasting change to the HE sector.” 

The potential role of MOOCs in ongoing learning and upskilling, particularly for older workers is theoretically vast and could be a key tool for helping people stay in work for longer. Let’s hope that this is borne in mind by those designing and marketing the courses.

Read more at http://techcrunch.com/2012/12/13/12-u-k-universities-forge-moocs-alliance-futurelearn-consortium-will-offer-uni-branded-open-online-courses-starting-next-year/

Hands up who wants a Minister for Retirement

In the past there have been various calls for a Minister for Older People or similar to focus on issues such as the provision of care for the elderly. Now retirement income specialists Primetime Retirement are calling for a Minister for Retirement to focus on retirement and pre-retirement issues

In research undertaken with a representative sample of 389 over-55s they found that 64% would support the idea with another 11% unsure.

Primetime Retirement believes that this strong backing for the new Government role reflects a growing realisation that the whole concept of retirement is changing – requiring  new solutions from both Government and the private sector and generating a demand for innovation and leadership as the country grapples with the changing retirement issues.

“Of course appointing a Minister won’t solve all the issues but it would help focus the Government and other stakeholders on the need for more options in the retirement income debate,” their spokesman said

Would it? Really? And if such a person were to be appointed, who would it be, with what skills and serving whose interests?

Do those who retire early live longer?

Should we aim to retire as early as we can or keep working for as long as possible if we want to live a long time? In addressing this question this article on the BBC news site busts some myths and shows how, if we read or hear something often enough, we will believe it is true.

The overwhelming message that emerges from this article is that there is no one single answer – for example some people get stressed by their work and would benefit from stopping whereas some go into decline and become stressed and despondent when they retire and have no work. Personality, personal circumstances (including finances), health, occupation, work environment and out-of-work relationships and interests must all be factored into the mix.

So let’s stop trying to provide a single answer for questions such as this, recognize yet again that you cannot lump all older people together, and satisfy ourselves with understanding that “It all depends…” 

http://www.bbc.co.uk/news/magazine-18952037

Beecroft advocates a return to mandatory retirement to solve crisis of youth unemployment

 

So wrong and so misguided on so many levels.

 

http://www.telegraph.co.uk/finance/financevideo/9365716/Adrian-Beecroft-force-older-workers-to-retire-to-cure-youth-jobs-crisis.html#disqus_thread

 

What becomes of Previously Important Persons?

Catching up on a blog by Mark Freedman (of Encore Careers fame) in the Harvard Business Review, I was intrigued to read his comment: “A former high-ranking media executive I met recently described himself as a new member of the PIP Squad — Previously Important Persons.”

It underlined what we all know – that to retire is to lose one’s importance and to become invisible in the eyes of the world. Ask any older person you meet what they do and it’s almost certain that if they say they’re retired they will immediately qualify it by addiing “but I used to be…..”  In short, they are a PIP.

PIP status isn’t linked to grade and salary achieved. A person didn’t have to be a big cheese, chairman or professional in their career. Whatever their level, what they were was someone who was important in the eyes of the world by virtue of their place as a contributing, valued individual.

Retirement strips people of that value and recognition. Above and beyond financial reward, it is what drives many to want to keep on working.

Mark Freedman’s blog: http://blogs.hbr.org/cs/2012/05/outsourcing_the_old_folks.html

Compulsory retirement age at Cambridge

Academics at Cambridge University have voted to support a compulsory retirement age of 67 for themselves in order to promote “intergenerational fairness” and enable career progression.

In an organization in which more than 60 per cent of the academic opportunities at the university in recent years have become available because somebody had retired, there are obvious arguments for doing so. However the need for innovation seems a tenuous claim being more related to length of tenure than age. 

Fortunately the ruling will not apply to non-academic staff and was supported by older academics themselves. As the final section of a report in People Management speculates, it will be interesting to see how many other universities go down this route. It will be even more interesting to see how many non-academic organizations try for an Employer Justified Retirement Age (EJRA) following this example.

http://www.peoplemanagement.co.uk/pm/articles/2012/05/cambridge-academics-approve-compulsory-retirement-age.htm

 

Deciding when to retire

Today, when standard mandatory retirement ages are a thing of the past, it is more important than ever for employers to understand some of the factors underpinning the retirement decision. For example, the timing of retirement where one of the key myths is that a person’s retirement date will depend largely on when their partner decides to retire, particularly in the case of women.

However, as a recent article in the Wall Street Journal indicated, the days when a husband automatically retired at 65 with a corporate pension and his wife dutifully followed him, are over. Most women approaching retirement age are now working, and many have their own retirement savings and viewpoints about the nature and timing of retirement.

Many of today’s older women entered (or re-entered) the workforce later than their partners following a period of non-work or part-time working while they raised their children. Consequently they may be at their peak with prospects ahead of them when men slow down and want out.

Add to this the fact that retirement, particularly for women, who tend to live longer, can now last for up to thirty years or so and women may look with horror at the prospect of relinquishing an income, social relationships and recognition for many potentially unfulfilling years ahead.

Of course, it’s not all bad news; many people – female and male – have very positive retirement plans. But, as the article indicates and my own experience with coaching and advising older people bears out, many individuals simply don’t talk to each other in any meaningful way about retirement beyond a shared acknowledgement that it will be good to leave the rat race behind.

Employers can help in many ways, not least through providing meaningful, couple-centred later life planning programmes and coaching. That may sound overly altruistic and unrealistic in this economic climate but, if employers want to see their older workers making positive transitions into retirement and being clear and open about their future plans, something has to change.

See the WSJ article at:

http://online.wsj.com/article/SB10001424052970204571404577255662010466038.html?KEYWORDS=retire

Abysmal knowledge about pensions

It has always seemed to me remarkable that our knowledge about many key aspects of life – whether financial, social or health-related – has to be obtained virtually by osmosis. Financial planning, parenthood, divorce… where do we learn what we really need to know about these and many other vital experiences? The answer, in respect of pensions at least, is that many of us don’t and either exist in a state of ignorance or just muddle by.

A worrying report in today’s Daily Mail, and no doubt elsewhere, highlights that the government is considering taxing the state pension at source. For now that’s not the worrying part, as experience shows that there is often (usually?) a huge gap between media scaremongering and what eventuates.

No, what did alarm me is that the article highlighted that research has shown that only four in 10 elderly people know the state pension is taxable and many discover it only when HM Revenue and Customs tries to claw back the tax later.  How can this have fallen under their radar?

Apparently about 5.6 million of Britain’s 12m pensioners pay tax, while the rest have an income below the tax-free threshold, £10,500 for 65- to 74-year-olds and £10,660 for those 75 and over.

John Whiting, tax director of the Office of Tax Simplification (OTS), which advises the Treasury on tax matters says bringing the state pension into the pay-as-you-earn system could reduce bureaucracy and would remove the need for around 1.6 million pensioners to fill in self-assessment tax forms.

Well yes. But let’s hope if this comes about that some of the money that is saved is invested in mandatory workplace pensions and retirement training.
Read more: http://www.dailymail.co.uk/news/article-2127157/Granny-tax-2-Fears-elderly-hit-state-pension-set-taxed-source.html#ixzz1rdPMlnMp