I'd like to say the idea of testing for license renewal is good, but I don't want to be wrong.
Ideally, yes, it'd be nice. People would know how to drive. Problem is that the tests are already useless. More tests means more bureaucracy and more uselessness and more wasted money; the American DMV has already proven itself fantastically ill equipped to deal with reality, and I suspect the same is true elsewhere. I know plenty of absolutely horrible drivers who've gotten their licenses very easily. I, on the other hand, and am probably the best driver out of all the people I know (personally; I know a number of people over the internet who would, almost certainly, easily hand me my ass), and I would probably stand a fair chance of failing such a test.