A paper examined minimum income policies for elderly people in Europe, and developed a typology based on entitlement and eligibility criteria. In the 2000s welfare erosion of elderly persons' non-contributory minimum income guarantees had been limited. Moreover, a substantial number of countries had pursued a deliberate policy of increases in minimum income benefits for elderly people. Nonetheless, only in a few countries were benefits were adequate to lift elderly people above the poverty line. At the same time, differences between European Union member states in terms of mode of access and benefit levels remained large.
Source: Tim Goedeme, Recent Trends in Minimum Income Protection for Europe's Elderly, Discussion Paper 27, GINI Project (European Commission)
An article said that there was no evidence that social expenditure had been shifting in favour of retired people at the expense of children in developed (OECD) countries, except perhaps recently in some Nordic countries. In the United Kingdom, support for retired people had shifted slightly in their favour as compared with children: but it was the result of a change in the original income distribution, not changes in taxes, benefits, or services in kind.
Source: Jonathan Bradshaw and John Holmes, 'An analysis of equity in redistribution to the retired and children over recent decades in the OECD and UK', Journal of Social Policy, Volume 42 Issue 1
A report examined retirees' motivations for seeking paid work, and their opportunities for gaining employment, in European Union countries. It considered the extent to which work after retirement was related to income adequacy among the retired population. It also explored the types of paid employment that retirees took up, and identified ways in which companies sought to recruit and retain retirees.
Source: Robert Anderson and Hans Dubois, Income from Work after Retirement in the EU, European Foundation for the Improvement of Living and Working Conditions
A report said that people aged over 50 who belonged to defined-contribution pension schemes underestimated how long they would live, and were over-optimistic about how well off they would be in their retirement.
Source: Rowena Crawford and Gemma Tetlow, Expectations and Experiences of Retirement in Defined Contribution Pensions: A study of older people in England, Institute for Fiscal Studies
An article examined the relations between older people, poverty, and place in rural Britain. Older poor groups constructed their lives in complex terms with references made to both social inclusions and social exclusions. Socio-cultural contexts of place were significant in shaping older people's understandings of poverty in rural areas.
Source: Paul Milbourne and Shane Doheny, 'Older people and poverty in rural Britain: material hardships, cultural denials and social inclusions', Journal of Rural Studies, Volume 28 Issue 4
A study examined the barriers to claiming pension credit. The findings supported previous research showing perceived ineligibility to be a primary barrier, with barriers related to process and stigma as secondary barriers.
Source: Lucy Radford, Lisa Taylor, and Claire Wilkie, Pension Credit Eligible Non-Recipients: Barriers to Claiming, Research Report 819, Department for Work and Pensions
A report examined key trends in the income of retired households between 1977 and 2010-11. The average disposable income for retired households was £17,700 in 2010-11, which was over two and a half times higher in real terms than in 1977. More than half of the rise could be attributed to growth in income from private pension schemes. Income from the state pension and other cash benefits had also grown in real terms: but income from investments had fallen since 1991 to a level just above that in 1977. Retired households paid 29 per cent of their gross income in tax, the same percentage as in 1977: but they paid a smaller proportion of their income in direct taxes, and more in indirect taxes such as VAT. Income inequality between retired households had increased rapidly between 1977 and 1991, but had fallen gradually since then.
Source: Income of Retired Households, 1977–2010/11, Office for National Statistics
Two think-tank studies examined the financial position of people nearing retirement. On average individuals aged 50 in England and over had experienced a fall in their household's gross wealth of 10 per cent as a result of the financial crisis – a drop of almost £60,000. Nonetheless 80 per cent of people aged between 50 and the state pension age were on course to achieve a replacement income in retirement of 80 per cent or better: only one-fifth would see their income fall by more than 20 per cent, and as many as 90 per cent could achieve a two-thirds replacement rate.
Source: Rowena Crawford, Tom Crossley, and Carl Emmerson, The Effect of the Financial Crisis on Older Households in England, Working Paper 12/09, Institute for Fiscal Studies | Rowena Crawford and Cormac ODea, The Adequacy of Wealth among those Approaching Retirement, Institute for Fiscal Studies
A report examined how to reconcile and optimize sustainability and adequacy concerns in relation to pension schemes in European Union member states. Achieving the goal of a cost-effective and safe delivery of adequate benefits that were also sustainable was 'quite challenging', as the time people spend in retirement and out of the labour market increased. Moreover, challenges had increased significantly as an effect of the economic crisis.
Source: Pension Adequacy in the European Union 2010–2050, European Commission
A briefing paper examined steps to increase saving for retirement in European countries.
Source: Boosting Retirement Saving Across Europe, International Longevity Centre – UK
An article examined the distributional effects of shifts from public to private pension provision in 15 European countries for the period 19952007. No evidence was found that shifts from public to private pension provision had led to higher levels of income inequality or poverty among older people.
Source: Olaf van Vliet, Jim Been, Koen Caminada, and Kees Goudswaard, 'Pension reform and income inequality among older people in 15 European countries', International Journal of Social Welfare, Volume 21 Issue Supplement s1
An article examined older peoples' vulnerability to economic fluctuations by exploring their perceptions of the impact of the economic recession on their well-being and quality of life, focusing on the 'asset rich-income poor' group. The recession was having adverse consequences for older people's quality of life in terms of economic, mental, and social well-being – although there was also evidence that some of them were equipped with certain resilience factors due to their money-management and budgeting skills.
Source: Lee-Ann Fenge, Sarah Hean, Louise Worswick, Charlie Wilkinson, Stella Fearnley, and Steve Ersser, 'The impact of the economic recession on well-being and quality of life of older people', Health and Social Care in the Community, Volume 20 Issue 6
A study of found that people aged over 80 and those with cognitive, sensory, and physical disabilities faced a series of barriers in accessing and using payment systems. Some people were able to overcome the barriers by capitalizing on technological developments such as internet banking and smartphones, or with the help of supportive family members. But those who lived alone, lived in poverty, or were digitally excluded could face limited access to goods and services.
Source: Policis and Toynbee Hall, Consumer Research with 'Older Old' Consumers and those Living with Cognitive, Physical and Sensory Disabilities, Payments Council
A report said that a 'toxic combination' of low interest rates, 'quantitative easing' by the Bank of England, and overshooting inflation had cut the spending power of 21 million older citizens. People over 50 had suffered a 9 per cent drop in real incomes between 2008 and 2012, causing them to reduce their spending by £24.7 billion – equivalent to a 1.6 per cent fall in national income.
Source: Scott Corfe, Charles Davis, and Tim Ohlenburg, The Impact of Quantitative Easing on Incomes of the Over 50s and Potential Implications for Consumption and GDP, Saga Foundation
A think-tank report called on the coalition government to remove imbalances in the tax system between young and old people. The tax-free lump sum and national insurance exemptions for better-off pensioners should be abolished: this would make the tax system more balanced and save taxpayers over £9 billion per year. Scrapping these tax breaks would only affect wealthy pensioners: two-thirds of existing pensioner households would be better off or unaffected by the proposed changes.
Source: Tim Leunig with Adam Corlett, Tax Justice Whatever Your Age, CentreForum
A paper examined how non-contributory minimum income schemes for elderly people had evolved between 1990 and 2009 in 13 'old' European Union member states. The erosion of the principal safety net of last resort for elderly persons had been limited. Moreover, in a substantial number of countries a deliberate policy of large increases in minimum income benefits had been pursued, leading to a remarkable convergence of relative benefit levels.
Source: Tim Goedeme, Less Is More? 20 years of changing minimum income protection for old Europes elderly, Working Paper 12/07, Centre for Social Policy (Antwerp University)
An article said that there was no evidence of higher levels of income deprivation among older recipients of disability living allowance compared with those receiving attendance allowance.
Source: Ruth Hancock, Marcello Morciano, and Stephen Pudney, 'Attendance allowance and disability living allowance claimants in the older population: is there a difference in their economic circumstances?', Journal of Poverty and Social Justice, Volume 20 Number 2
A Conservative MP said that older people needed to shoulder a bigger share of public spending cuts. He called for benefits such as bus passes, health prescriptions, winter fuel allowance, and television licences to be means-tested by the next government (after 2015).
Source: Speech by Nick Boles MP, 10 July 2012
Notes: Boles was reported to have played an important role in drafting Tory policy plans before the 2010 election.
A paper examined the impact of recent reforms on the ability of pensions systems in Europe to alleviate poverty and maintain living standards. Although reforms had decreased generosity significantly, in most countries poverty alleviation remained strong. However, moves to link benefits to contributions had made some systems less progressive, raising adequacy concerns for certain groups. In particular, unless the labour market outcomes of women and of people on lower incomes changed substantially over the coming decades, state pension transfers would prove inadequate, particularly in eastern European countries.
Source: Aaron George Grech, Evaluating the Possible Impact of Pension Reforms on Future Living Standards in Europe, CASEpaper 161, Centre for Analysis of Social Exclusion (London School of Economics)
A report examined pension adequacy in the European Union over the period 2010-2050. 'Great advances' had been made in the sustainability of public pensions: but adequacy outcomes were less impressive and largely contingent on changes in peoples retirement and long-term savings behaviour.
Source: Pension Adequacy in the European Union 2010-2050, European Commission
An article examined life course patterns and their consequences for income inequality in Germany and Britain. The liberal welfare state in Britain generated more unstable retirement trajectories (differentiated) that were more dissimilar across the population (de-standardized) than the conservative-corporatist welfare state in Germany. Contrary to common conjectures, this was not associated with higher income inequality among retirees in Britain. There was no simple straightforward link between life course patterns and income inequality.
Source: Anette Eva Fasang, 'Retirement patterns and income inequality', Social Forces, Volume 90 Number 3
A report by a committee of the Northern Ireland Assembly said that benefit-paying agencies did not have an accurate estimate of the extent of unclaimed benefit by people of pensionable age.
Source: Report on the Uptake of Benefits by Pensioners, Sixth Report (Session 2011/2012), Northern Ireland Assembly Public Accounts Committee, TSO
A paper examined the effect of the financial crisis on older households (age 50 and over) in England, and estimated the effect of wealth shocks on household consumption and individual expectations for the future. Many households had experienced a significant wealth shocks: but these shocks led to modest spending effects and small revisions to expectations regarding future bequests. Expectations of bequests seemed particularly tied to housing wealth.
Source: James Banks, Rowena Crawford, Thomas Crossley, and Carl Emmerson, The Effect of the Financial Crisis on Older Households in England, Working Paper 12/09, Institute for Fiscal Studies
An article examined the impact of lifecourse family and labour market experiences on household incomes of older people in Belgium and the United Kingdom. Differences between the two countries could be explained in terms of welfare regime arrangements. Family experiences had a larger impact on incomes in old age in 'male-breadwinner' Belgium, whereas in Britain labour market events were more important. As social transfers in Britain were more aimed at poverty prevention and less at income replacement, a 'scarring effect' of unemployment persisted even into old age.
Source: Caroline Dewilde, 'Lifecourse determinants and incomes in retirement: Belgium and the United Kingdom compared', Ageing and Society, Volume 32 Issue 4
A paper estimated the implicit disability costs faced by older people, using data on over 8,000 individuals from the Family Resources Survey. Disability costs were strongly related to the severity of disability and to income, and – at an average level of almost £100 per week among over-65s with significant disability – they typically far exceeded the value of any state disability benefits received.
Source: Marcello Morciano, Ruth Hancock, and Stephen Pudney, Disability Costs and Equivalence Scales in the Older Population, Working Paper 2012-09, Institute for Social and Economic Research (University of Essex)
A paper examined the implications for retirement income of the coalition government's policies to extend working lives. The vast majority of people aged over 50 who were working in 2011 – around 85 per cent – might have sufficient state and private pension income to provide a retirement income of £11,000 per annum if they continued to work and save until they were eligible to receive their state pension. But 45 per cent of them might have to work and save for more than 10 years after state pension age in order to replicate their working-life living standards in retirement.
Source: Daniela Silcock, Daniel Redwood, and Chris Curry, Retirement Income and Assets: The implications for retirement income of government policies to extend working lives, Pensions Policy Institute
A paper used the detailed retrospective information provided by the third wave of the Survey of Health, Ageing and Retirement in Europe (SHARE) to estimate two different measures of lifetime resources.
Source: Christoph Weiss, Two Measures of Lifetime Resources for Europe Using SHARELIFE, Survey of Health, Ageing and Retirement in Europe
An interim report by an official advisory body examined tax simplification for pensioners.
Source: Review of Pensioners Taxation: Interim Report, Office of Tax Simplification
Two linked reports reviewed a study in which 2,000 people who were deemed to be eligible for, but not in receipt of, pension credit were paid an estimated pension credit entitlement without the need for a claim. Some increases in take-up could be attributed to the study, but these were only marginal.
Source: Natalie Maplethorpe, Mehul Kotecha, and Sue Arthur, Qualitative Evaluation of the Pension Credit Payment Study, Research Report 795, Department for Work and Pensions | Lucy Radford, Quantitative Evaluation of the Pension Credit Payment Study, Research Report 796, Department for Work and Pensions
The 2012 Budget statement set out proposals to:
Increase the income tax personal allowance by £1,100 in April 2013, to £9,205 per year. The basic rate limit (the range of income subject to income tax at the basic rate of 20 per cent) would be cut by £2,215 to £32,245 per year from the same date.
Freeze the age-related personal tax allowance for those aged 65 and over from April 2013 at 2012-13 levels until it was aligned with the allowance for those aged under 65. From April 2013, the age-related allowance would be restricted to those eligible at that point.
Cut the 50 per cent top rate of income tax to 45 per cent from April 2013.
Cut corporation tax by an extra 1 per cent from April 2012, to 24 per cent. Together with cuts already announced, corporation tax would fall to 22 per cent in April 2014.
Withdraw child benefit from households in which someone had an annual income of over £50,000 per year (rather than households with a higher-rate taxpayer as previously announced). The withdrawal of child benefit would be implemented in steps for households in which someone had an income of between £50,000 and £60,000.
Introduce a new stamp duty rate of 7 per cent on residential property worth over £2 million.
Issue to all taxpayers, from 2014-15, a new 'Personal Tax Statement' detailing the income tax and national insurance contributions that they had paid, their average tax rates, and how this contributed to public spending on different areas.
Cut total public spending on 'welfare' by an additional £10 billion by 2016.
Source: Budget 2012, HC 1853, HM Treasury, TSO
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A new book examined the rise of welfare markets in western societies, focusing on old age provision (both retirement provision and elderly care). It considered whether pension and care systems were converging under the influence of globalization – with marketization being a key phenomenon – and to what extent this was creating a transnational culture of welfare markets.
Source: Ingo Bode, The Culture of Welfare Markets: The international recasting of pension and care systems, Routledge
A study examined the experiences of people aged 65 and over living on low incomes. Despite a reduction in the number of people in later life living in poverty, it remained an issue for a significant minority of older people.
Source: Katherine Hill, Liz Sutton, and Donald Hirsch, Living on a Low Income in Later Life, Age UK
Researchers examined the events that could act as a trigger to thinking about, making enquiries about, or claiming pension credit – with the aim of understanding the decision-making process that individuals went through in the build-up to submitting a claim.
Source: Darren Bhattachary and Zoe Slade, Investigating the Triggers Into Claiming Pension Credit, Research Report 785, Department for Work and Pensions