Older people are still living in poverty and with growing inequality in later life

Our first blog post of the week looks at the findings from Age UK’s latest Chief Economist report. It focuses on the key economic aspects in the lives of many older people in the UK: inequality and poverty, and benefit take-up. 

Almost 60 years ago, Peter Townsend studied the lives of older people in East London and wrote:

The object of national assistance is largely to make up income, on test of means, to a subsistence level… A general definition of need is incorporated in its scale rates, and these are applied to individual circumstances, with certain discretionary disregards and allowances. The sums are intended to cover food, fuel and light, clothing, and household sundries, beside rent, and sometimes, after investigation, small additions are made for laundry, domestic help, or special diet. This definition of ‘subsistence’, on such evidence as exists, appears to be completely unrealistic.

You would be forgiven if, after reading Age UK’s latest Chief Economist Report, you concluded that not much has changed over all those years. Because, though the material aspects of the lives of older people in the country, whether in East London or East Belfast, have undeniably improved since then – thanks in a great part to the way initially ploughed by Eleanor Rathbone MP and the Old People’s Welfare Committee, Age UK’s predecessor, the current state of poverty among older people still looks dismal and grim as much as what it was like in Bethnal Green in yesteryear. Continue reading “Older people are still living in poverty and with growing inequality in later life”

The more stringent the social care eligibility, the lower the quality of life of service users

After a comprehensive and meticulous review, we have recently published an academic paper that looks into efficiency in the provision of social care services for older people in England It is a difficult, technical piece; here we describe what we did and present the main results.

Efficiency denotes ‘doing more with less’ but sometimes is used as a euphemism for cuts.  This is not how we approached the issue. Rather, our yardstick was the quality of life of people receiving the services (that is, the users themselves). Higher quality of life equals higher efficiency. Simple.

Even if we focus on quality of life, we could think of efficiency in terms of either how to spend the least to generate a given level of quality of life or how to generate the most quality of life with the given bundle of resources available. We chose the latter approach. Focusing on spending the least would distract efforts away from people in need towards objectives expressed in expenditure items, sterling pounds, delivery contract clauses and the like. Instead, by focusing on making the most with what’s available we can learn about what may be behind that which matters to users of social care services and their families: their quality of life in relation with the care they get. Continue reading “The more stringent the social care eligibility, the lower the quality of life of service users”

Disability benefits do benefit people in poorer neighbourhoods’

We carried out a piece of research which studied whether the proportion of older residents in lower super output areas (LSOA) in England receiving disability living allowance and attendance allowance was statistically related to the degree of income poverty among older people in the area. (LSOAs are geographical areas with a mean population of 1,500 people; there are 32,482 LSOAs in England). The paper was peer-reviewed and was just published in the Journal of Maps (http://www.tandfonline.com/doi/abs/10.1080/17445647.2012.695441).

We applied a number of spatial econometric techniques, given the geographical nature of the data. The data for beneficiaries come from the Department for Work and Pensions. Income poverty among older people is one of the indicators compiled by the Social Disadvantage Research Centre at the Department of Social Policy and Social Work at the University of Oxford. The estimates of total population by age are from the Office for National Statistics.

We found a greater concentration of DLA and AA recipients over state pension age living in deprived areas than in more affluent areas: nearly 30 per cent older beneficiaries live in the 20 per cent poorest of areas and approaching two thirds live in the poorest half of areas.

Even after accounting for significant spatial effects, we still found a strong, positive relationship between proportion of beneficiaries and proportion of older people in poverty .

These allowances are therefore benefiting more deprived communities.

The study does not allow us to affirm that the allowances are directly benefiting older people in lower income. However we can conclude that these benefits, although not means-tested, would be partially addressing the geographical inequalities in income of older people across England.

Reducing or eliminating these benefits would hit the harder the poorer the neighbourhood.

Last year, Age UK helped 500,000 people put £120million back in their pockets through free benefits information and advice. This year, we will continue to break down the barriers that prevent people from claiming, in particular older people not realising that they are eligible for some additional income. For more information, please visit www.ageuk.org.uk/moremoney

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There may be even more trouble ahead – last week’s announcement of Subsidised Loans

Last Thursday, George Osborne, Chancellor of the Exchequer, and the Governor of the Bank of England, Mervyn King, jointly announced a new measure to stimulate economic growth. They also, importantly, did not rule out more quantitative easing.

Mr King prescribed a recipe of subsidised credit, estimated to be worth about £80bn –already known as ‘funding for lending‘. Technically, it consists of auctions by the Bank of England of loans totalling a minimum of £5bn a month for 6 months at a minimum rate of the Bank Rate plus 25 basis points (currently 0.75 per cent).

They feel this is required because the volume of loans to non-financial companies has been falling since the onset of the crisis: the chart below shows that less money has been loaned than the month before, almost every month, since February 2009.

Monthly changes

Continue reading “There may be even more trouble ahead – last week’s announcement of Subsidised Loans”

Social care expenditure in the context of informal caring

The funding of the social care system is very much up in the policy and political agenda, but it is seldom related to or put into the context of informal, voluntary caring. Let’s have a look at some numbers.

Public spending on social care services on people aged 65 and over, net of any fees and charges paid by clients, amounted to roughly £7.5 billion in 2010. This includes the assessment and care management, the placements in nursing and residential care homes, the provision of supported accommodation, home care and day care services, equipment and adaptations, community meals and other community services, as well as any direct payments.

We looked into the Survey of Carers in Households in England 2009/10, which reports the prevalence of informal caring –that is, excluding people providing care in a professional capacity. In this survey, carers are defined as those people who identify themselves as having extra responsibilities of looking after someone who has a long-term physical or mental ill health or disability, or problem related to old age.

The survey shows that around 8 per cent of people aged 65-69 provide informal care for at least 20 hours a week (the preferred measure for statistical reasons), and this figure goes up to 15 per cent among those aged 75 or over. Incidentally, only 3 per cent of informal carers look after someone due to old age.

Using the population estimates from the ONS, we estimated that around 1 million people aged 65 and over are providing care for at least 20 hours a week -equivalent to 11% of all people in this age group.

If we adopted the most conservative figure of only 20 hours a week (and remember that the survey measures ‘at least 20 hours’), we would estimate that in a whole year, people aged 65 and over provide around 1.04 billion hours of informal, voluntary care.

When economists are pressed to translate voluntary care in monetary terms, we tend to use the minimum wage, which currently stands at £6.08 an hour. Multiplying the minimum wage by the number of hours of informal caring annually provided by the 65 plus, we get a grand total of £6.3 billion. That is, £6.3 bn worth of services foregone by older people. Over six billion pounds that are not computed in the gross domestic product, and that tend to go unnoticed in the current discussions about the care system.

More to the point, it is equivalent to 84 per cent of total net expenditure on social care on older people. In other words, the 65 plus are generating for free services equivalent to 84 per cent of all the public spending on social care on this very age group. 84 per cent! And that’s a very conservative estimate…

Age UK are calling on the Government to reform the adult social care system. Find out more about Age UK’s Care in Crisis campaign and how to sign up to our petition.

The work well done

As the State Pension Age rises and people are being encouraged to work for longer, more and more employers (and the public too) are going to have to change their perceptions of older workers. Instead of believing the negative stereotypes and considering that older workers are likely to be less effective at certain jobs than their younger colleagues, perceptions need to change to recognise that each person is an individual with different skills and capabilities.

I came back from a short break in Catalonia, Spain, last week, where I learned about a common thread through the Catalonian culture: the ‘feina ben feta’ –or ‘work well done’.

I read about a local artistic movement by the turn of the last century which made of the quest for properly accomplished tasks one of its leitmotivs. In the park surrounding the monastery of Montserrat I came upon the monument to Joan Maragall, a poet, which includes the following call: “Strive in your endeavour as if the salvation of humanity depended upon each detail you think, each word you say, each piece you assemble, each blow of your hammer. Because it does depend on them, believe me”.

The following day I watched a programme on national TV about Teodoro Gómez. Mr Gómez takes the bus to work every morning. Nothing unusual here. He works at an industrial bakery set up by his grandfather –again, not uncommon for a long-standing family-run business. He weighs each baguette, for either the needle in the scale has to stop at 230 grams exactly or they are not sold. Well, a good example of ‘feina ben feta’ you might say, but still not much to make it on national TV.

One of his grandsons runs the ‘cakes and buns’ department and one of his granddaughters is in charge of one of the retail outlets. Grandson? Granddaughter? Oh, yes, for I forgot to mention that Teodoro is 100 years old. He still loves passing on his wealth of experience and expertise to the younger generations (some of his great-grandsons are already part of the staff). And not just his experience and expertise, but his values and work ethos too.

I came back from Spain with a whole new perspective of my own work. It goes beyond professionalism. It goes beyond doing proficiently what is expected. Señor Gómez is not from Catalonia, but he rolls his kneading pin as if human life as we know it depended on it.  I want to be part of his bunch.

Back in the UK, there are increasing numbers of people working past their State Pension Age. As pension values declines and the State Pension Age goes up, the longer-term trend will almost certainly be for more people to stay in work. Of course, most people won’t want to work until 100, but as we may have to work longer that expected it is essential to break down such negative stereotypes, especially that older workers will not perform as well.

Do you know of any British Teodoro’s? I would love to know about them, and perhaps they could even help Age UK to get this message across. What a privilege it would be to meet them.

Find out more about work and learning

On the myth of age and voting intentions

The other day I caught myself singing “it’s just one of those myths…” to the well-known song by Cole Porter which actually goes “it’s just one those things”. I wondered whether it had been a Freudian slip, until I realised it had to do with the many ‘myths’ which we, at Age UK, have set about to demolish and are charging against daily. ‘Older people this’, ‘population ageing that’. One of these myths is that the age of voters is, by and large, related with their political preferences.

It is usually voiced that it’s the relatively older voters who tip the balance in the General Elections in the UK, for the turnout among those over 55 is bigger than that of under-25s. Whereas this is true, the relation between age and voting intentions is often overlooked – it is simply accepted as a matter of ‘fact’ that such a relation exists: “older voters tend to go for the Conservatives”, for example.

Obviously, we don’t actually know how people finally vote, but we do know what they said they intended to vote shortly before each election –thanks to Ipsos-Mori, which has been collecting these data over the last 30 years. And thus I could test whether there has been any statistical association between age and voting intentions for the three main political parties (plus a fourth catch-all category, ‘other’) since the 1987 General Election – for previous years, the breakdown of the data by age varies. For this purpose I used a fairly common statistical test: the chi-square test of independence, which I’m sure you either know a lot about or do not want to know anything of right now, so I’m going to omit any details here. Continue reading “On the myth of age and voting intentions”