The Government is bringing forward to 2010 its review of the default retirement age, which allows employers to force employees to retire at 65.

Depending on its conclusions, this could lead to a radical change to the law in this area.

Our society has undergone rapid demographic change in recent years. People can currently expect to spend more than a third of their lives over the current state pension age of 65, and since 2007 there have been more pensioners in the UK than children.

The Government this week launched its Building a Society for All Ages strategy, to help Britain prepare for an ageing society. It is the latest in a series of announcements on major reforms to respond to these changed demographic circumstances.

Currently, employers can lawfully require employees to retire at 65 (the so-called default retirement age) as long as they follow the correct procedure.

This has come under increasing criticism, and is currently the subject of a legal challenge by the charity Heyday (part of Age Concern). The House of Lords considers the case this month, but is widely expected to rule that the UK's existing law is not in breach of European requirements.

Whatever the outcome of the Heyday challenge, the Government had previously said it would review the default retirement age in 2011 to see if it was still needed. It has now brought the review forward to next year in response to changing demographic and economic circumstances.

The majority of people currently retire before 65, but more than one million people choose to work beyond state pension age, and many more say they would work past 65 if their employer permitted it.

Ministers acknowledge that older people now need more flexible retirement options and that the economic landscape has changed since the age laws permitting forced retirement at 65 came into being.

Given these comments, the smart money is probably on a change to the law following next year's review. The Government says any changes would not be implemented until 2011.