So the retired are living the life of Riley? Take a look at the true figures

Income of UK pensioners still lags far behind most of Europe

Share

If you are – how shall I put this – of a certain age, you could be forgiven for feeling just a little beleaguered. From the Chancellor’s Autumn Statement to figures released by the Office for National Statistics a couple of days ago, the burden of most analysis can be summed up like this. While hard-working families have experienced plummeting living standards as a result of the financial crisis (or this wicked government’s cuts – take your pick according to your politics), pensioners have been lavishly featherbedded, and all because the Government wants to keep them sweet.

Among the figures cited in support of the “mollycoddled oldies” thesis, the most striking come from the ONS. According to these, the median income of retired households in the UK grew by 5.1 per cent between 2007/8 and 2011/12, while that of non-retired households over the same period fell by 6.4 per cent. The generations, it might be concluded, really are spinning apart.

Cue an anti-pensioner offensive. Given that our senior citizens are doing so splendidly, is it not time to reconsider the winter fuel allowance and the bus pass, and the free television licence for over-75s, or at least to apply a means test? As for the “triple lock” – this government’s guarantee that the state pension will rise annually by 2.5 per cent, the rate of inflation, or average earnings – whichever is highest – surely this is out of date. Why should all those hard-working families be subsidising the retired, who are clearly living the life of Riley?

This has been the argument of numerous economic think-tanks in and around the Autumn Statement. It was also heavily hinted at in a report of the ONS findings on the Today programme – prompting pensioners to demand that the corporation state not only the percentage figures for changes in household income, but the comparative figures in actual money. When, about an hour later, these figures were broadcast, they showed pensioners’ supposed privileges in a rather different light. It turned out that, despite the 5.1 per cent rise of the past five years, pensioner households were still worse off on average than non-pensioner households, by more than a third.

This should be starting point for a serious pensioner fightback. For if the comparative position of retired households has improved since 2007/8, what does this say about their situation before? The income of UK pensioners still lags far behind that of most pensioners elsewhere in Europe, in part because of the paltry level of the state pension, in part because of the inadequacy of many private schemes. Public sector employees are the exception here, which is why – for those in the know – there is so much resentment.

Yes, those who retired in the past decade or two have truly never had it so good. Their company pensions bore some relation to their salary; annuity rates were comparatively high, and homeowners made a mint from house-price inflation. So long as their health holds out, they can travel the world and live in the style to which they are accustomed.

Those retiring more recently, however, have been hit by far lower annuity rates and interest rates on savings that are for all practical purposes negative – the same interest rates, it should be noted, that afford non-retired households some of the lowest mortgage rates ever. Today’s pensioners can legitimately complain that, if they followed official advice to save for their retirement, they have been deceived. Not only has their prudence yielded them next to no extra income, but it has disqualified them from such help – housing benefit, pension credit, free social care – as their non-saving peers receive.

Unlike younger people, pensioners have almost no way to enhance their income, and their costs tend to be higher, too. At home for much of the day, they face higher heating bills. Age-weighted insurance makes driving and travelling more expensive, and they must pay for any help they need to stay in their own homes. Purpose-built private housing is expensive and hard to find. It’s all very well saying older people should cash in their big homes, but there has to be somewhere for them to move.

Those well-meaning pensioners – I will refrain from naming names – who make play of wanting to hand in their bus passes, donate their fuel allowances to charity and means-test their own benefits are a fortunate few. Regrettably, by proclaiming their thwarted altruism, they help to create a largely inaccurate image of a pampered generation that risks depriving the much less affluent majority of benefits they really need.

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
iJobs Job Widget
iJobs General

King's College, Cambridge: Stipendiary Junior Research Fellowships October 2016

£20,100 (pre-award of doctorate) rising each year to a maximum of £25,869: Kin...

Recruitment Genius: Web Developer - Back End

£18000 - £24000 per annum: Recruitment Genius: A fantastic opportunity has bec...

Recruitment Genius: Online Lettings Negotiator

£18000 per annum: Recruitment Genius: This is a fantastic opportunity to join ...

Guru Careers: Trainer / IT Trainer

£30 to £32k : Guru Careers: We are seeking a Trainer / IT Trainer to join an a...

Day In a Page

Read Next
Unlimited quantities of alcohol were served at the party. File photo  

Ohayo is the hangover cure from heaven. What will stop us from drinking ourselves into oblivion now?

Olivia Acland
From left: Yvette Cooper, Jeremy Corbyn, Liz Kendall and Andy Burnham at a televised Labour leadership debate  

Jeremy Corbyn wouldn't be so far ahead in the Labour leadership race if his rivals weren't so awful

Ash Burt
Mullah Omar, creator of the Taliban, is dead... for the fourth time

Mullah Omar, creator of the Taliban, is dead... again

I was once told that intelligence services declare their enemies dead to provoke them into popping up their heads and revealing their location, says Robert Fisk
Margaret Attwood on climate change: 'Time is running out for our fragile, Goldilocks planet'

Margaret Attwood on climate change

The author looks back on what she wrote about oil in 2009, and reflects on how the conversation has changed in a mere six years
New Dr Seuss manuscript discovered: What Pet Should I Get? goes on sale this week

New Dr Seuss manuscript discovered

What Pet Should I Get? goes on sale this week
Oculus Rift and the lonely cartoon hedgehog who could become the first ever virtual reality movie star

The cartoon hedgehog leading the way into a whole new reality

Virtual reality is the 'next chapter' of entertainment. Tim Walker gives it a try
Ants have unique ability to switch between individual and collective action, says study

Secrets of ants' teamwork revealed

The insects have an almost unique ability to switch between individual and collective action
Donovan interview: The singer is releasing a greatest hits album to mark his 50th year in folk

Donovan marks his 50th year in folk

The singer tells Nick Duerden about receiving death threats, why the world is 'mentally ill', and how he can write a song about anything, from ecology to crumpets
Let's Race simulator: Ultra-realistic technology recreates thrill of the Formula One circuit

Simulator recreates thrill of F1 circuit

Rory Buckeridge gets behind the wheel and explains how it works
Twitter accused of 'Facebookisation' over plans to overhaul reverse-chronological timeline

Twitter accused of 'Facebookisation'

Facebook exasperates its users by deciding which posts they can and can’t see. So why has Twitter announced plans to do the same?
Jane Birkin asks Hermès to rename bag - but what else could the fashion house call it?

Jane Birkin asks Hermès to rename bag

The star was shocked by a Peta investigation into the exotic skins trade
10 best waterproof mascaras

Whatever the weather: 10 best waterproof mascaras

We found lash-enhancing beauties that won’t budge no matter what you throw at them
Diego Costa biography: Chelsea striker's route to the top - from those who shared his journey

Diego Costa: I go to war. You come with me...

Chelsea's rampaging striker had to fight his way from a poor city in Brazil to life at the top of the Premier League. A new book speaks to those who shared his journey
Ashes 2015: England show the mettle to strike back hard in third Test

England show the mettle to strike back hard in third Test

The biggest problem facing them in Birmingham was the recovery of the zeitgeist that drained so quickly under the weight of Australian runs at Lord's, says Kevin Garside
Women's Open 2015: Charley Hull - 'I know I'm a good golfer but I'm also just a person'

Charley Hull: 'I know I'm a good golfer but I'm also just a person'

British teen keeps her feet on ground ahead of Women's Open
Turkey's conflict with Kurdish guerrillas in Iraq can benefit Isis in Syria

Turkey's conflict with Kurdish guerrillas in Iraq can benefit Isis in Syria

Turkish President Erdogan could benefit politically from the targeting of the PKK, says Patrick Cockburn
Yvette Cooper: Our choice is years of Tory rule under Jeremy Corbyn or a return to a Labour government

Our choice is years of Tory rule under Corbyn or a return to a Labour government

Yvette Cooper urged Labour members to 'get serious' about the next general election rather than become 'a protest movement'