Age-old question of retirement

Of nothing is this more true, however, than the thorny issue of pensions. Throughout its time in office, New Labour persistently ignored the evidence that state-pension commitments would become unaffordable, apparently in the hope that the problem would somehow go away.

If swift action is now inevitable, however, must it herald nothing more than the doom and gloom now being predicted by union leaders?

The raising of the state-pension age will inevitably mean many people having to work longer. But this is a long-overdue admission of the reality that people are also living a lot longer and, if they are to enjoy lengthier retirements than earlier generations did, then these have to be paid for.

At the very least, the option of one or two more years of work prior to a higher standard of living in retirement is surely preferable to the present system in which millions of pensioners are left in poverty or else face means-testing to try to qualify for Gordon Brown's inadequate and inefficient pension credit.

But just as many workers do not like the idea of postponing retirement, many others resent being forced to leave a job merely because they have reached an arbitrary age. The test of how well the Government handles this crisis is surely whether it can turn it into an opportunity for more elderly people to realise their potential, defy ageism in the workplace and avoid being shunted into an unwanted retirement.

Certainly, the type of flexibility being talked about yesterday by Works and Pensions Secretary Iain Duncan Smith gives hope that imaginative solutions can be found.

In the meantime, however, the coalition has an even more urgent task – ensuring that the private sector is in a sufficiently robust position to provide the extra jobs that will be needed if retirement options are not going to be eliminated by redundancy and unemployment.