May 6, 2009

Think tank suggests Britons work longer

A British think tank says paying off the debt taken on to combat the recession could require raising the country's retirement age to 70.

The added income tax revenue and reduction in retirement benefits would offset the debt if retirement ages -- currently at 60 for women 65 for men -- were changed to 70 for 10 years, the National Institute for Economic and Social Research said in a report.

An alternate approach would be for the government to raise the income tax rate or cut government spending 10 percent, The Daily Telegraph reported Wednesday.

A spending cut of that size would impact education and other basic services, the Telegraph said.

The choice is we have got to raise income tax a lot, cut spending a lot, or work longer, said senior researcher Ray Barrell.

There is a stronger case for extending working lives because we're all living so much longer, he said.

Shadow Chancellor George Osborne said the report graphically illustrates the shocking scale of Gordon Brown's debt crisis.

The government budget calls for borrowing $263 billion in 2009. Budget deficits would take until at least 2018 to pay down, officials said.