IN THE present economic recession, retirement may seem to be the last thing to worry about. It is hardly surprising that top of people’s concerns are unemployment and the spectre of huge tax increases necessary to back the Government’s bailout of the banks. However, pensioners – 2.5 million of whom live in poverty – are already becoming aware of the threats to the pensions, benefits, health and social services on which they depend.
Some 2,000 delegates from all parts of Britain will assemble in Blackpool on June 2 at the opening of the 17th annual pensioners’ parliament. They will be discussing how the recession is affecting pensioners. Rosie Winterton, minister of state for pensions and the ageing society, together with representatives of the Conservative Party, Liberal Democrats and the SNP, will participate in a question-time session which promises to be a lively affair. It is expected a clear message will be sent out from Blackpool that pensioners are not going to accept any burdens resulting from the depression.
Who will say that the older generation should contribute towards the billions going to the banks and their directors – one of whom is now looking forward to early retirement on £14,000 a week? It is hardly surprising that pensioners receiving a basic state pension of just £95.25 a week are campaigning for a better deal.
Before 1908, resorting to charity and the workhouse were the only ways in which older people could survive. A nationwide campaign won the old age pension. Although it was inadequate, for many it offered an alternative to poor relief and heralded the welfare state.
Today, 60 per cent of all pensioners have incomes of less than £175 a week, while one in four older people live below the official poverty level of £165 a week and have to claim means-tested poor relief, now called the pension guarantee.
Without a change in Government policy, by 2050, more than 30 per cent of all workers in retirement will be in poverty. Defined benefit occupational plans are disappearing fast and the present crisis underlines, not only that reliance on savings is sufficient, but also that pension plans dependent on annuity purchases do not secure expected retirement incomes.
Only the National Insurance-funded, pay-as-you-go pension scheme that is independent of the stock market can solve the problem. This fact has led the trade union movement to
give strong support to the demand for increasing the state pension.
The National Pensioners’ Convention argues that the basic pension should be above the official poverty level and paid equally to all men and women. We make this case at a time when, apart from the bailout of the banks, the unused balance in the National Insurance Fund is £50 billion. The old argument that “We just can’t afford it” simply can’t be taken seriously.
Joe Harris is general secretary of the National Pensioners’ Convention
