Could older people's benefits be next for welfare cuts?

 
Older women having lunch on a bench Older people's benefits have largely escaped austerity cuts

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They receive around half of the government's welfare budget but so far older people have largely dodged the austerity bullet.

Unlike working age benefits, their pensions will go up by at least the rate of inflation for the next few years.

While child benefit is now means tested, bus passes, free TV licences and winter fuel payments still go to pensioners regardless of their income.

And that looks likely to remain the case until at least 2015.

Share the pain

But there have been murmurs on all political sides about whether older people should continue to enjoy protected status beyond the next election.

There may well be working age benefit and tax credit claimants who think it is right that older people share more of the pain.

The Institute for Fiscal Studies estimates means testing the help older people get for fuel and their TV licences could save £1.6bn alone.

And some older people are already sacrificing those benefits.

Start Quote

Sir John Hall

We don't need those benefits. We are comfortable, and there are many people like us”

End Quote Sir John Hall Former Newcastle United owner

Former Newcastle United owner Sir John Hall is a millionaire, living in the luxurious County Durham hotel he owns.

And yet the 79-year-old is entitled to free prescriptions, a state pension, a £200 winter fuel allowance, a bus pass and a free TV licence.

He acknowledges they are benefits he doesn't need.

He said: "We have paid the £200 fuel allowance each year to the Durham Foundation. They collect it from as many people as are willing and then distribute it to those who need it more than we do.

"I do not have a bus pass, and I think we pay the TV licence. We don't need those benefits. We are comfortable, and there are many people like us."

Ration benefits

Sir John's money then has ended up subsidising a lunch club for older men in Shildon in County Durham.

They're certainly not millionaires, and many believe it's time to ration those benefits to those who really need them.

Vernon Chapman said: "Nowadays this country's got more millionaires in it but they will still be getting all the entitlements when they do not need them."

And Richard Wheatley said: "There should be a guide, a level beyond which the payments are cut-off, say those getting more than £40,000 to £50,000-a-year."

But what about those pensioners who are reasonably comfortable but well short of Sir John Hall's status?

Older men's lunch club Some believe older people's benefits should be targeted at the less well-off

I caught up with some at the Tyneside Cinema's Silver Screen club in Newcastle. Most certainly don't consider they are wealthy. They are reluctant to see their benefits targeted.

John Goss said: "I do not consider myself to be wealthy at all. I do not think expats in their villas in the south of France should get a winter fuel payment. On the other hand why shouldn't I get it?"

Ray Garside agreed: "I think it is very hard to say because we are fairly comfortable we should not be getting these allowances when it's due to our efforts that we are in this position."

But Ray's wife Doreen does think there is some scope for sacrifices to help younger people.

She said: "Our generation has been lucky. They have been able to buy their house, they have seen them go up in value, and paid their mortgages off.

"They have got a working pension and a state pension so I feel that we are quite privileged."

Economic turbulence

Start Quote

Ray Garside

I think it is very hard to say because we are fairly comfortable we should not be getting these allowances”

End Quote Ray Garside

But although older people have seen many of their benefits protected they have not been left entirely untouched by recession.

Many private pensions have been badly affected by economic turbulence, annuities have been cut, and savings are earning pitiful amounts of interest.

In addition, studies suggest older people are much more vulnerable to inflation.

The argument for protecting older people has also been based on their inability to change their circumstances.

While those of working age can hope to get a job to get out of the benefit system, it is harder for older people.

And of course many have paid decades of taxes on the basis they could benefit when they retired only to see their savings eaten up by care costs.

But perhaps some may be able to work longer in order to support themselves and generate more taxes.

Paul Hancox, from Wallsend, in Tyneside, would certainly like that opportunity. He may be 66 but he still wants to carry on working as a marine engineer.

So far opportunities have been few and far between.

He said: "Employers are not supposed to discriminate on the grounds of age but you do not know what they are saying at HR.

"They might ask, is he going to have a heart attack when he's working for us, is he going to get ill? You can see the challenge for the employer."

Of course many more of us will be forced to work longer as the pension age begins to rise.

But it does seem increasingly likely that benefits for the current older generation will be scrutinised more closely beyond 2015, especially as more cuts to public spending seem likely.

Given older people currently get £200bn from the public purse, the temptation to eat in to that will be great.

But politicians may still tread a little carefully. There's one thing all older people have in common - they're the most likely to vote in elections.

 
Richard Moss Article written by Richard Moss Richard Moss Political editor, North East & Cumbria

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  • rate this
    0

    Comment number 88.

    We were not told this report we took part in was headed by a millionaire talking of giving up winter fuel allowance. Clever use of edited clips juxtaposing Ray with the millionaire, missing out 95% of what he said so looks like he's a wealthy pensioner who doesn't care about those on state pension only.I do paid and voluntary work so not an honest reflection of our position.Travel passes important

  • rate this
    0

    Comment number 87.

    "ciconia"
    Fair enough if I have misunderstood but I believe myself and my family struggle. We don't get much to be honest , just enough to live on. My main problem is with the government really. Yes I understand that pensioners have had hard times too. Luckily for me I had a grandmother who taught me how to cook home cooked food, bless her.
    Can never get my scones right though hers were the best

  • rate this
    0

    Comment number 86.

    #85
    Fine bollywood, taxpayer pays for your degree course, even if you pay a bit back, or for my pension?
    My comment, 'are you ready..?' was a reference to your misunderstanding of pensioner entitlements to benefits. I had no wish to offend you.
    Pensioners aren't getting much in the way of special treatment, and they pay taxes too.
    We never dreamed of the benefits now available to you.

  • rate this
    0

    Comment number 85.

    "ciconia"
    Why shouldn't I study for a degree?
    I will have to pay it back if I go back to work, also I am aware that some pensioners are struggling , I just think it is unfair that the government seem to be making sure pensioners are protected from certain things yet others have to pay, this is not me having a go , I just think certain choices the government make are wrong thats all

  • rate this
    0

    Comment number 84.

    My blood boils with every weasel letter that refers to my state pension as benefit, as if I get it because I can't support myself.
    Wrong.
    The pension was a compulsory part of National Insurance, reduced by incomplete years. My late wife only received 2/3rds because of this.
    And yes we have a moral duty to provide a benefits safety net, but not to fund personal lifestyle choices.

  • rate this
    0

    Comment number 83.

    I think we have a moral duty to look after each other regardless of age. Right now everyone is having to make sacrifices, the younger generation are having to pay more to receive less than their parents did - and are working just as hard as they did - so I think it's right that pensioners have to sacrifice something. There has to be some protection though, I don't want my parents freezing to death

  • rate this
    +2

    Comment number 82.

    Here we go again!Why do so many believe that as Pensioners we are nothing but a drain on their wallets?
    How about those of us who worked & paid for what we thought would be sufficient to keep us in retirement? Now we are treated like Pariahs!
    Obviously those for killing everyone over retirement age are very young & inexperienced.
    We have been there,done that& got the tshirt!!
    You'll be old soon

  • rate this
    +3

    Comment number 81.

    bollywoodfan 13
    From a pensioner;
    This 'unfair' system is at other people's expense educating your children and giving you the chance to do a degree, an opportunity that very few pensioners ever had.
    You obviously have no idea of the hardship and sacrifices we suffered, and are also making assumptions about pensioners and benefits that are wrong.
    Are you sure you're ready for degree study?

  • rate this
    +1

    Comment number 80.

    554,000 frozen pens’rs live abroad some PAYING UK TAX. No benefits. But 630,000 living abroad get full pension.Other benefits should not be paid to pens’rs that because of their income can afford to pay for them. As income they could be dealt with as taxable at 100% once a minimum level of tax free income is reached. At the same time pay frozen pensioners the full pension they have paid for.

  • rate this
    +2

    Comment number 79.

    I don’t live in south of France I do live in Indonesia in an ordinary house. I get no benefits, and would not expect any. However I DO still pay UK income tax on my pension. That pension though is frozen, not like those in France, and has not increased in 7 years I lived here & paid UK income tax. A pensioner with 40+ years of paying NI & tax surely entitles me to a full uprated pension.

  • rate this
    0

    Comment number 78.

    How fickle these reports are. Earlier they quoted pensioner’s savings had been hit by government and how many are a lot poorer off. The truth is when the government introduced these “vote for us” benefits they did not look at what the consequences would be. Short sighted policies have caused much of the financial problems we the tax payers, including pensioners, have now got to pay for.

  • rate this
    -2

    Comment number 77.

    Well living in this day and age is bloody hard! You are indeed lucky to own your own house , my life has been very difficult and coping with my illness is also difficult. I am actually studying for a degree and my children are doing really well at school so I am proud of the fact I am a good mum.

  • rate this
    +3

    Comment number 76.

    NO, i have worked since i was 17, so has my wife, 2 children both working, we own our own home, never claimed any benefits (ex CB). I went to college/night school to better myself as my wife did. We are in good health thank god, my elderly parents are not but they do not whinge like you do. I might add, they get sod all benefits because they saved. They dont expect the rest of us to support them!!

  • rate this
    -2

    Comment number 75.

    Well I have paid enough in NI and income tax to be worthy of having some help. I am not even slagging them off!
    It is the governments silly rules how things are like they are, I am merely pointing out that everyone in this country should help. Not just families who struggle to make ends meet as it is. Have you tried living on next to nothing?

  • rate this
    +3

    Comment number 74.

    Cheek?

    I am fed up of people like you slagging off the elderly. They have worked for the retirement, they can spend their on money on what they want. They have paid enough in to get some cheap benefits now.

    Compared to what you are claiming that will be miniscule. Stop talking Crap!

  • rate this
    -1

    Comment number 73.

    "Bengit"
    What a cheek!!
    Whinging am I ?
    Elderly in general make remarks about my weight , woman in supermarket didn't!
    I worked bloody hard before I had my children, so I have contributed towards my benefits! By the way I didn't ask to be ill! Luckily my husband is wonderful and cares for me !!

  • rate this
    +2

    Comment number 72.

    71. bollywoodfan13
    I was responding to comment 68, before you changed your council tax comment in post 69.
    So lets get this right, was the elderly person laughing at you because of you weight or because you had to put food back? You seem to be changing your story.
    Anyway carry on wingeing, I will carry on contributing towards your benefits.

  • rate this
    -1

    Comment number 71.

    "Bengit"
    We do use a calculator when shopping !! Sometimes shops mark prices wrong! If you look at my last comment I do mention council tax!!

  • rate this
    +1

    Comment number 70.

    68. bollywoodfan13

    If you are such a tight budget I suggest that you buy a very cheap calculator to ensure that you do not have top put food back!

    Yes it is up to her..... you are correct, people are entiltled to buy what they want.

    No mention of your Council Tax comment I notice, not retracting it?

  • rate this
    -2

    Comment number 69.

    Also I know some of the elderly pay council tax, but I am talking about council tax benefit really theirs will remain fully paid where I have to find the money somehow. Some elderly have double what I get a week and I have a family of four to feed. I. If the elderly are rude to me about my weight I will tell them you don't know me go away. As for Winter Fuel Allowance don't get me started !

 

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