'Arbitrary' retirement age may be scrapped

Ms Harman, who is also Labour's deputy leader, signalled she does not want employees to be forced to quit when they reach 65 as she criticised discrimination against older people.

She called for a "massive public policy change" which could see new rights to flexible working introduced for the elderly.

"The retirement age is arbitrary, it bears no relation to people's ability," she said in an interview. "People are remaining active and healthy well into their older years. But at the moment there is no legal backing for you if you want to stay at work, so what we are proposing is a massive public policy change.

"We do want people, if they want to, to be able to stay working for longer and flexible working is a way that enables them to do that."

In her speech at an Age UK event, Ms Harman said ageism was costing the economy tens of billions of pounds a year and criticised the notion that people aged over 65 are "past it".

Last year the Government announced it was bringing forward a review into whether employers should be stopped from forcing staff to retire at 65. It was due to take place in 2011, but will now take place this year as the Government seeks to respond to "changing demographic and economic circumstances".

Currently employers can require all staff to retire at 65 regardless of their circumstances, but at the time pensions minister Angela Eagle said older people should be given "flexible retirement options" because some want to retire early while others prefer to keep working.