Because it won't have enough money to pay the billions in pensions needed in around 20 years' time when the number of people over the age of 65 will treble to 1.5m.

At the moment, there are around five people working for every person over the age of 65. But by 2050, our greying population will see that ratio plummet to just two people working for every pensioner.

"We are living longer as a race, and Ireland is catching up with the Europeans in terms of longevity, quality of life and health, " said Enterprise minister Micheal Martin last week. "We have to ask whether we should be looking at facilitating on an optional basis people who want to continue working." The minister, however, revealed his real intentions in the next line.

While ruling out plans to extend the official retirement age: "a gradual or flexible retirement could be offered to the over 65s who would also be able to access some of their pension, " he said. And 'some' is the key word here.

But haven't we set up a special fund to save for this rainy day?

Yes, but even the 21bn squirrelled away to date may not be enough to pay for the pensions of the future. Set up by former finance minister Charlie McCreevy in 2000, the problem is that this fund is to cover the cost not only of state pensions . . . which everybody over the age of 65 in the country receives . . . but also the growing cost of pensions to the public service's own 250,000 employees, who are greying at an even faster rate. These 'gold-plated' pensions cost the taxpayer almost 1.8bn every year, a figure that is rising faster than the paybill to serving staff.

Speaking in the Dail earlier this month, Finance minister Brian Cowen admitted that the cost of meeting public service pensions into the future is 45bn. This is even more than the national debt of 37bn and over twice the 21bn we have saved so far in McCreevy's reserve fund, which also has welfare pensions.

The state pension of around 200 per week will cost short of 4bn this year and again is rising rapidly. By 2050, it is estimated to cost around 10bn a year. So the state is set to come up a bit short.

But doesn't everyone have their own private or occupational pensions?

Some do, but most don't. What will really put the bang in the pension time bomb is that around two-thirds of private-sector workers don't have their own pension. This means that, overnight, incomes drop to the state pension level of around 200 a week . . . if the government can even pay that.

So what is being done?

For years now, the government has been trying to encourage everybody to start a pension as early as possible. But even though pension contributions are tax deductible at the top rate, workers don't want to commit to a cost which has no immediate material benefits.

While the government is toying with the idea of making pensions compulsory, this would be strongly resisted by employers who are already paring back on the few pension schemes that are already in place.

But don't lots of people want to work past 65 anyway?

Retirement at 65 was set at a time when life expectancy was far lower than it is now, while the quality of life of those extra years is also much improved. Working conditions have also improved dramatically so that older people are now more physically able to work in their twilight years. Experience and common sense are now more valuable commodities in a worker than strength and stamina.

Last year, GP Dr Patricia Comer was adamant that, at 70, she was capable of providing as good if not a better service to her patients as she was 20 years earlier. But according to HSE rules, GPs must stop treating medical card patients when they reach 70. "They're not judging me on ability. It's only a birth cert, " Comer said.

In 2000, Justice Fergus Flood, who headed up the Flood tribunal (now the Mahon tribunal), was persuaded to stay on despite reaching the official retirement age for judges of 72. Flood finally went in 2003 just a week short of his 75th birthday. But many mourned the retirement of the gregarious judge, who showed no signs of a deteriorating mental ability to grasp the complexity of the issues coming before him.

Three years ago, the first formal move was made to cut the cost of public service pensions when legislation was passed which allowed new entrants to the public service to work past the age of 65 if they wanted to and if their health permitted. Ever since, public service unions have been seeking the same 'benefit' for serving public servants. The unions argue that, not only would many public servants like and feel more capable of working past 65, but many, particularly those who started their career late, may need a full salary for a few more years.

What is the legal situation?

Increasingly, like our workforce, it is very grey. Speaking in the Dail earlier this month, minister Martin said that recent amendments to the Employment Equality legislation protects against discrimination on the grounds of age in relation to access to employment.

"However, they also permit an employer to decide on a retirement age in a particular employment to give flexibility to employers and employees, having due regard to the nature of the work being performed, " he said. There is no age discrimination in employment rights and there are no provisions in employment or equality law that impose a compulsory retirement age in relation to employment, he added.

But while the legal situation may currently be unclear, in about 20 to 30 years' time, it will come down to a matter of money. If the government doesn't have enough cash to pay your pension and you don't have your own pension, then you may very well have no choice but to work till you drop. The critical question then many not necessarily be whether you want to retire but whether you can afford to.