PROPOSALS to allow people greater flexibility in deciding when they should give up work have been welcomed by the Chamber of Commerce.

A report by the Chartered Institute of Personnel and Development said retirement for everyone at 65 years old was "unsustainable" in view of the current pensions crisis.

However, raising the retirement age would be unpopular, according to the institute, so flexibility - including allowing people to work past the traditional retirement age - was called for.

Chris Harvey, head of membership at the Chamber of Commerce, said the chamber supported the proposal, as there were benefits for companies, the individual and also society.

"There are very good reasons for being flexible with retirement," he said.

"Studies have shown that people want to be active and carry on doing things, and this helps their health, if they think they're contributing. So it helps them and helps society.

"Plus, there is a skills shortage in this country - there is a negative birth rate so we are not replacing ourselves - and employing older, more experienced people could help this."

He said, however, the impact of an ageing work force on small businesses needed to be assessed.

"No one has looked at how we manage this change in very small businesses and we are currently seeking funding to do some research.

"But there could be great benefits - to the companies, in terms of the skills older people have, to the individual, in financial terms and also in terms of being more mentally alert, and to society, because people's health will be better."

Bob Parry, who runs 40Plus Recruitment - an agency in Barbourne, Worcester, specialising in older workers - said people should be given the option to continue working later in life if they wanted to.

"About 25 per cent of our database are over 60 years old and only one person out of those has said they want to retire at 65," he said.

"In fact, we have people actively looking for work who are 65 years old and over.

"I think older people want to be active and also have the social interaction that working gives you. About 10 to 15 per cent of our database are already over 65 years old.

"And employers should be more aware of the skills that are offered by older workers."