NETHERLANDS - The Dutch government has rejected calls to raise the official retirement age and stated it would prefer to motivate people to work until they reach age 65.

Social affairs minister Piet Hein Donner said in a written statement to parliament this was the government's preferred route, following proposals from the Committee Labour Participation - the so-called Bakker Committee - which called for a broad and fully-integrated approach to tackle the effects of an ageing population and the subsequent labour shortage.

"Our policy is to prevent raising the official retirement age," said Donner.

"This means working until 65 must become normal again, securing the government finances and stabilizing the ratio between life-expectancy and life in employment," he said.

The Bakker Committee proposed the government raise the retirement age gradually from 65 to 67 between 2016 and 2040.

As a short-term measure, Donner announced the government would lower social contributions for companies next year if they employ workers between 62 and 65 and if they hire older employees.

In addition, the government will also consider the options of increasing the state pension AOW if employees voluntarily - fully or in part - postpone the start of their AOW, the minister said.

"Furthermore, the cabinet will look into the conditions and circumstances required to avoid raising the official retirement age as well as the options open to redefining the pensionable age," he added.

According to Donner, the government shares the conclusion of the Bakker Committee suggesting any tackling of the labour shortage must not be delayed.

However, the government has attempted to discourage early retirement, many employees still stop working between the ages of 62 and 65, he continued.

There are over 250,000 job vacancies in the Netherlands, while the number of unemployed workers totals 900,000, the minister indicated

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