Yeah, very likely the break caliper needs rebuilt or replaced. They are known for sticking with age. I had the same problem with mine once.
Apparently the mk4 calipers can be fitted with new hoses, as their design is apparently better, so will ensure longevity. Have a search for further info in the mk2 section....
Get it sorted sooner rather than later. Its not overly safe! and the grease may have already left the hub bearing due to the heat.