PN100104EA

EMBARGOED UNTIL 00.01

SATURDAY 10 JANUARY 2004

THE UK IS STILL PERMEATED WITH AGEISM. LONGER LIFE EXPECTANCY REQUIRES A RADICAL RETHINK OF THE ROLE OF OLDER PEOPLE IN THE ECONOMY AND SOCIETY IN GENERAL. THE TIME HAS COME FOR BLATANT AGE DISCRIMINATION TO BE ENDED.

The Lords Economic Affairs Committee has called for the Government to consider replacing the basic state pension with a non-means tested citizenship pension dependent on years of residence, rather than on contribution to National Insurance. This provides the foundation for the necessary development of a scheme of additional pensions financed by voluntary saving.

The Lords inquiry into Aspects of the Economics of an Ageing Population found the current state pension system is failing many women and ethnic minorities who are most vulnerable to poverty in old age. 

The report (which examined pensions policy, the supply of labour, age discrimination, and retirement age) concluded that population ageing does not pose a threat to the continued prosperity and growth of the UK economy.

The Chairman of the Committee Lord Peston said:

"The UK has adapted well to challenges and opportunities posed by an ageing society. New laws on age discrimination in 2006 should help empower and encourage far greater participation of older workers. Nonetheless, a bias against employing older people and of appointing them to public bodies remains; this is economically inefficient and ethically unacceptable. It should be ended, and the government, in particular must take a lead."

Citizenship Pension

The Government should urgently investigate the option of providing a decent non-means tested basic citizenship pension based on years of residence, rather than on full contribution record. (para 8.10 −8.13)

Means Testing

The Government's heavy and growing reliance on means testing is regrettable as it taxes some of the poorest pensioners at marginal rates at least as high as those imposed on the rich. (paras 10.16 - 10.28)

Retirement Age

The Government should not permit the continued use of a normal retirement age by employers, whether at age 65,70 or 75, unless the employer can provide an objective justification for the use of age rather than performance criteria in determining employability. (para 6.43)

Age Discrimination Legislation

The report also claims that the EU Employment Directive on Equal Treatment (the age component is due to be implemented in 2006) is likely to have a profound impact on employment practices and workers in the UK. (para 6.28 − 6.46)

(The Government will determine how to incorporate the age component of the Directive into UK legislation after it completes its consultation on Equality and Diversity: Age Matters in Spring 2004.)

We recommend the UK's forthcoming legislation provide access to rapid and low-cost arbitration of age discrimination disputes. (para 6.41) The Government should be as explicit as possible about where exceptions to the law may exist. (para 6.34)

Workforce Participation

The Committee support the Government's aim of encouraging more people between ages 50 − 64  (and over) to participate in paid employment. More needs to be done to specifically address large regional disparities. (para 4.27)

The Relationship between Age and Job Performance

The Government should Commission research on the relationship between age and job performance to inform future policy. (paras 5.18 - 5.26)

NOTES FOR EDITORS

1. The Members of the Economic Affairs Committee on this inquiry were:

Lord Barnett

Lord Burns

Lord Elder

Baroness Hogg

Lord Newby

Lord Oakeshott of Seagrove Bay

Baroness O'Cathain

Lord Paul

Lord Peston ( Chairman)

Lord Roll of Ipsden

Lord Sheppard of Didgemere

Lord Vinson

2. The report is published by the Stationery Office: Aspects of the Economics of an Ageing Population, House of Lords Economic Affairs Committee, 4th Report, Session 2002−03, HL Paper 179.

3. In the mid 19th century, average life expectancy for men was 42; today it is over 75. 

4. The average UK employment rate for 50 − 64 year-old-men is 70%, ranging from a high of 78% in the South East to a low of 55% in the North East. Women's average participation rate of 55% ranges from a high of 62% in the South East to a low of 45% in Wales.

For embargoed reports contact: Amanda Cook on 020 7219 6968.

For further information contact: Robert Graham-Harrison, Clerk to the Committee, on 020 7219 5358.     

 [ENDS]