Chancellor George Osborne announced a “job-rich recovery for all” while he outlined the government’s future economic plans in the Autumn Statement.
The key announcements included a few plans that came much earlier than expected. The first are the plans to increase the state pension age to 68 in the mid 2030’s and to 69 in the late 2040’s. Under the new rule, the age will vary based on an average life expectancy. Ultimately, people will spend no more than a third of their expected life drawing a pension. The “rule” is set to be reviewed every five years.
The second announcement that was released earlier than anticipated is the personal tax allowance plan. This is said to go up to £10,000, meaning that a typical basic rate taxpayer will pay £705 less income tax per year compared to 2010-11.
The Chancellor also addressed the high levels of youth unemployment and the plans to require any young person (18-21) to undertake training from their first day of claiming benefits. If they fail to do so, they will lose their entitlement. Furthermore, funding for an additional 20,000 Higher Apprenticeships over the next two years will be increased.
The hope is that this measure will encourage many businesses to take on young people, to help reduce risk and cover the costs of the additional training that under-21’s require.
Osborne’s confirmation that the state pension age would increase attracted criticism from multiple unions. One human resource expert said that the new plans would condemn millions of people to work until they drop. This will effectively mean poorer people with lower than average life expectancies, which will fund the pensions for the more wealthy.
As the workforce becomes more age diverse, the workplace will need to adapt in multiple ways, including management and development. This proves especially true when the average working life span of a person could last over 50 years.
While the overall impact of a growth on reducing the fiscal deficit is welcome, HR experts are still adamant about addressing this management deficit.