It would be a disaster. The system can hardly cope with the number of people taking their test for the first time, let alone adding thousands of retests to the mix.
It might make some sense to renew licenses every 10 years and require people who meet a certain criteria to retake the test. Maybe someone who has had more than one at-fault accident (with some threshold for damage/injury, so a minor parking bump wouldn't count) or more than a certain number of moving violations. The idea is to assume people can still drive unless something happens that suggests otherwise.
It would also make sense to make the driving test more difficult. When my wife took her test she didn't even have to drive on a public road. How can you possibly tell if someone is a competent driver if the test doesn't even observe them interacting with other motorists? How can you tell if someone can control their vehicle if they never go over about 15-20mph in the test? The real world has other motorists, faster roads, junctions etc.
