April 27, 2006

Britons seek happy retirement while Russians see 'beginning of the end'

By Rupert Jones

· Worldwide study finds UK, US and Canadian optimism
· 30% in Britain say yes to compulsory savings

Despite years of gloomy headlines claiming our pensions are in crisis, people in Britain have a much more positive view of retirement than those in other countries, according to a major new study.

Researchers for HSBC bank found 82% of Britons see retirement as "a time of happiness", far higher than the global average of 62%. Swedes, Canadians and Americans also tend to be optimistic about the prospect of getting older and stopping work. But for many people in Russia, retirement is something to be dreaded. Some 23% of Russians view it as "the beginning of the end". Only 3% of Britons share this gloomy view.

These are among the findings of what is described as the largest study of attitudes to retirement ever carried out, involving interviews with 21,000 individuals and 6,000 employers in 20 countries. The study centred on how people defined retirement, how it should be paid for and the age at which people should stop work.

British employers will be pleased with some of the report's conclusions. Britain had the highest proportion of employers who said they were actively trying to recruit workers aged 50 and over: 44%. This compared with about 33% for the US and Japan, and less than 10% for China and Indonesia. Britain also led the field in offering older workers the opportunity to work fewer hours: 71% of employers said they offered this, compared with a global average of 30%. In China, only 7% of urban employers allowed a shorter working week for older employees.

Employers in Britain had a more positive view of older workers' productivity, flexibility and speed of learning. But they are also much more likely to impose a mandatory retirement age.

As far as individuals are concerned, people in Britain are more likely than average to see retirement as an opportunity for "a whole new chapter in life". Some 56% of Britons gave this answer, putting the UK just behind the US (64%) and Canada (58%), and again well ahead of Russia (15%) and Egypt (11%).

The study also provides fresh evidence that compelling people to pay into pensions might not be the political suicide some have suggested. "Government-enforced additional private savings" was the most popular option for paying for retirement, chosen by 30% of Britons when asked how they thought governments should finance ageing populations. Raising the retirement age and increasing taxes polled 23% and 22% respectively.

"In almost every country and across all age ranges, more people choose compulsory saving than any other solution," the report says. That finding is likely to provide food for thought for ministers as they struggle to find a consensus over Lord Turner's proposals for revamping the pensions system.

On average, people in the UK think men should retire at 63.8. That is just a few months short of the actual typical male retirement age of 64.2. Saudi Arabians think men should retire at 53 but typically finish work at closer to 56. Turks think women should retire at 48.

Stephen Green, HSBC's chief executive, said the study showed that individuals increasingly expected to bear their own retirement costs but governments and businesses needed to understand their role in continuing to support people.