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Tag Archives: Incomes
Last week George Osborne confirmed the Government’s intention to implement the surprise tax changes he announced in the Budget in March. At the same time the Government and the Financial Conduct Authority have set out more detail on what guidance will be available to people to help them make their choices at retirement.
In a surprise announcement at the start of 2014 David Cameron, the Prime Minister, said that maintaining the ‘triple lock’ for the basic state pension will be a key part of the Conservative’s next election manifesto. This would mean that, at least until 2020, the basic state pension would be increased annually by the rise in prices, earnings or 2.5 per cent – whichever is higher. In response the Labour leader Ed Miliband has also said he is committed to the triple lock.
Reaction has been variable. Some newspapers immediately suggested this would affect other benefits such as the winter fuel payment – the Daily Mail’s headline was ‘Turmoil over OAP benefits’. The Independent welcomed the announcement but said it does not go far enough pointing out that the basic pension is still only £110 a week.
Alternatively, others have focussed on what this means for younger people with the Intergenerational Foundation stating the move is unaffordable and ‘betrays’ the younger generation. Continue reading
Last week Age UK launched the second edition of its Economic Tracker . This addition includes the result of the first wave of a survey we have developed to track older peoples’ views on the economy and their financial situation.
It received quite a lot of coverage in the media, particularly because of the startling statistic the nearly a quarter of people in their early 50s were worried about losing their home as a result of falling behind with mortgage repayments. Like other age groups many older people are suffering a fall in income in the current period of austerity and this is having an impact on their well-being.
- Over three million people aged 50+ are very worried about the cost of living. This is in the context of rapidly increasing prices for some essential items, especially utilities, which we know have a significant impact on older people’s finances.
- Only thirty-eight per cent of 50+ say the future looks good for them
- 35% feel worse off financially compared to last year (see chart below)
Since our first edition, the UK economy and economic policy have given us food for thought. There are concerns, disappointments, and one or two silver linings. As our polling data suggests the economic situation is particularly worrying for many of those approaching retirement, tomorrow’s pensioners, who find it more difficult to find a job following redundancy. Our analysis has found that older workers are more likely to be made redundant when compared to those aged between 24 – 49. This translates into higher proportions of older unemployed workers being out of work for longer. Forty-seven per cent of unemployed people aged 50 – 64 have been out of work for 12 months or more compared to thirty-seven per cent of people aged between 25 and 49. The situation of older people is not as bad as those between 16 – 24, but it is important to highlight that all ages are struggling in these tough economic times.
Quite rightly there is a lot of attention on the young unemployed at the moment, but we must ensure that those over 50 are not forgotten. More can be done by the Government and employers to recognise the value of workers over 50 (the experience and skills that come with a longer working life), provide more training and learning for those in later life, and do more to eliminate the ageism that too often occurs in workplaces.