From Ros Altmann:economist and pensions,
    investment and retirement policy expert

  • pensionsandsavings.com

    Spring Statement – great as far as it goes, but nothing for pensioners, not even the poorest

    Spring Statement – great as far as it goes, but nothing for pensioners, not even the poorest

    • Congratulations to Chancellor for bold moves to help working families.
    • But nothing for pensioners struggling, no improvement in their pensions – just 3.1% rise when inflation today is 6.2% and forecast to be 7.4% this year!
    • Clear priority is for workers and businesses, with nothing to help the elderly.

    Prioritise working families, businesses, skills training: The Chancellor’s Spring Statement shows a careful judgement about priorities for the country as we move forward, with clear priority to helping working families, improving skills across the country and helping businesses invest more to drive economic growth.

    Welcome NI threshold increase but won’t help non-working households: I do support the Chancellor’s measures to adjust the NI threshold, although there will be higher costs for businesses.  Increasing the National Insurance threshold will certainly help offset the pain of the National Insurance rise for lower earners, which would otherwise see their pay packets reduced just as the cost of living crisis worsens. The increased threshold to align NI with the personal tax allowance is helpful for the poorest working families, who will find they are no longer seeing deductions from their pay packets.  But it won’t help non-working families at all.

    Extra help for skills training needs to also be focussed on older workers:  I also welcome and support extra help for small businesses, better investment incentives and funding for skills training.  These are all really important and must also be applied to older workers, so that individuals are not leaving the workforce, or struggling to find new work, as their skills have become outdated or they need to retrain for a new career.

    Other social objectives seem to have been downgraded: It is clear that the Chancellor’s priorities are working families, businesses, controlling public spending and helping growth, which are all worthy objectives of course.  However, there are important social aspects that seem to have been neglected. Extra spending could have been allocated this year to help those struggling, right now, day in and day out, with the inflation crisis.

    No new help for pensioners, especially the poorest, who face inadequate 3.1% rise vs. 7.4% inflation: In particular, there is no relief for pensioners, especially the poorest, who cannot work any more, due to age and infirmity.  They were promised proper protection at the last Election, but have seen it snatched away.  The State Pension and Pension Credit will rise by only 3.1%, while inflation has now risen to 6.2% driven by rising basic living costs, and the OBR is forecasting that it will increase to 7.4% in the year ahead.  How can those depending only on State Pensions, hope to make ends meet?

    Inevitably, there will be a rise in pensioner poverty:  Already there are about 2 million poor pensioners, with over a million being in fuel poverty before the latest price rises. Even the means-tested Pension Credit, which is supposed to top up the income of the poorest retired people, is only increasing by 3.1%.

    Dropping the earnings link for Pension Credit was a major error in social policy: The was a failure to honour the commitment to increase State Pensions and Pension Credit in line with earnings,  because the 8% earnings figures were upwardly ‘distorted’ by the pandemic.  However, he chose to use the also distorted September 3.1% cpi figure, which was exceptionally low and did not reflect the October fuel price cap rise, which was already known. The House of Lords passed measures to keep the triple lock earnings link protection, with at least a compromise adjusted earnings figure, but the Government rejected this out of hand.  This leaves pensioners without sufficient protection against the cost of living crisis they are facing right now.

    Shame that there is no more support for pensioners right now, next year may be too late for many: I did hear the promise to restore the triple lock next year, but offering jam tomorrow, when it comes to pensioners, is not satisfactory.  Offering a better increase next year, will not help those elderly people who are at the end of their lives, unable to afford to heat their homes and feed themselves adequately and may not even be alive by then.  They need help now.  The household support fund is hardly likely to reach them. The result of this will be more misery and poverty for pensioners.  They deserve better. I would have liked to see more support being allocated for this year to these vulnerable members of society.

    One thought on “Spring Statement – great as far as it goes, but nothing for pensioners, not even the poorest

    1. Fine words Baroness, but words explaining our situation are just words.(I am 83 and do not qualify for any of the Tories charity schemes. While influential Tories like yourselves wring their hands at this injustice,what exactly can you and your peers in the Lords actually do? All incentives Sumak promises is trying to encourage everyone to go to work. WE CAN,T. Is their not a champion in the Commons for us?

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