SUMMARY OF CONCLUSIONS AND RECOMMENDATIONS
(a) We recommend that
the Government should commission research to establish a minimum
income standard for households over pension age in both absolute
and relative terms, and that such research should be conducted
at regular intervals to inform the Government's progress in countering
poverty and social exclusion among older people. (Paragraph 22)
(b) Generally, older
pensioners face greater challenges than those who are recently
retired. They are, currently, less likely to have an occupational
pension; where they do, this will have diminished, in relative
terms, because it will have been linked, at best, to prices and
not to incomes. While the coverage of occupational pensions is
likely to increase, the price-related nature of them will not,
meaning that this will remain as both a long- and short-term issue.
Also, older pensioners' incomes from earnings and investments
are lower. As well as having a lower income, older pensioners
can face greater expenses, related to disability, mobility needs
and depreciation of assets. Therefore, we believe the need to
provide enhanced assistance to older pensioners will need to remain
a long-term objective for any government. (Paragraph 28)
(c) We welcome the
Minister's recognition that there are particular problems and
challenges regarding pensions for people from ethnic groups. However,
we are not convinced that adequate information currently exists
regarding the scale or true nature of these problems and we therefore
recommend that the Government commission research to provide more
information concerning the extent of poverty among minority ethnic
pensioners. (Paragraph 45)
(d) We note that there
is potentially a serious problem which could result in many self-employed
people being reliant on means-tested benefits upon retirement,
a fact which is exacerbated by the changing nature of self-employment
and the capital assets owned by the self-employed. We recognise
that there is an argument for compelling the self-employed to
make provision for a second pension, and that there is scope for
this to be achieved via the state second pension. We recommend
that this option be considered once the Pension Provision Group
has produced its forthcoming report into pension provision for
the self-employed. (Paragraph 49)
(e) We agree that
the current level of the personal expenses allowance for pensioners
living in residential care is inadequate. We recommend that the
Government commissions research to establish the level of personal
expenses which is necessary to enable pensioners in institutional
care to live their lives with dignity. (Paragraph 51)
(f) The evidence we
have received leads us to conclude that it would be complacent
to think that disparities in the incomes of older and younger
pensioners and between retired men and women are set to disappear,
although they may narrow. However, the oldest look set to remain
among the poorest, and particularly the oldest women. In addition,
we believe that there are new challenges to be faced, particularly
in ascertaining the true situation regarding poverty amongst pensioners
from ethnic groups and how this can best be tackled, and regarding
the pension provision of self-employed people. (Paragraph
52)
(g) We.... conclude
that those on the lowest incomes throughout their working lives
or with intermittent and fluctuating earnings will be largely
dependent on SERPS and the state second pension, to lift themselves
above the [Minimum Income Guarantee] MIG. While we have not found
agreement on a single definition of poverty, we doubt that anyone
would draw the poverty line below the MIG, and note.... that this
is a level which the Minister has said he could not live on. (Paragraph
67)
(h) We conclude that
the present policy of uprating the basic state pension, and the
second state pension during retirement, in line with prices, while
the MIG is linked to earnings, as is the state second pension
at the point of retirement, is unlikely to be sustainable in the
long run. (Paragraph 77)
(i) We have concluded
that, whatever the merits of the argument as to whether
[the basic state pension should be linked to earnings], a rise
in the level of the state retirement pension by index linking
it either to an index based on the FBU/Age Concern concept of
low cost but acceptable income or to earnings is affordable, but
only in the context of people being prepared to pay higher taxes
and national income contributions in the long run. (Paragraph
108)
(j) We recommend that
the current campaign to encourage take-up of the Minimum Income
Guarantee should not be a one-off exercise, but part of a longer
term, sustained strategy to improve take-up among all those who
are eligible. (Paragraph 124)
(k) A take-up campaign
for Income Support among pensioners cannot fully succeed unless
undertaken in tandem with identification of those eligible for
Attendance Allowance. We recommend that the DSS work more closely
with local government and local pensioner organisations to identify
pensioners who are eligible for Attendance Allowance and who therefore
qualify for Income Support and to encourage them to claim both
benefits. (Paragraph 126)
(l) We recommend that
the DSS should conduct research into take-up of the Minimum Income
Guarantee among ethnic pensioners and into the best means of encouraging
people from different ethnic communities to claim. (Paragraph
130)
(m) If the Government
is to realise its long-term aim of giving pensioners solid state
pension provision on which they can build, without their own pensions
and savings being eroded in old age by means-tests, and if we
are to make a start in bridging the gap towards our proposed target
as proposed by the National Pensioners Convention, we have concluded
that an increase in the state non-means-tested pension is inevitable
and that it should be done sooner rather than later. (Paragraph
141)
(n) We await the details
of the proposed pensioner's credit, but unless it can achieve
[the objective of reducing the number of pensioners reliant on
means-tested benefits in order to avoid poverty], and meet our
concerns for the mid-term future, we believe that the earnings
link for uprating the basic state pension will need to be restored
to provide a firm financial platform for retirement on which people
can build for the future. (Paragraph 141)
(o) We recommend that
in order to directly target help on the oldest pensioners who
are also likely to be the poorest, the Government should raise
the level of retirement pension for those aged 80 so that it is,
and remains, at the equivalent level of the Minimum Income Guarantee.
(Paragraph 143)
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