The plight of pensioners

The Daily Telegraph is conducting a campaign seeking to promote the interests of elderly savers.

This morning they released the details about savings incomes for pensioners. In 1996-97 pensioners on average enjoyed an income from savings and investments of £1,920. By 2006-07 this average had dropped to £1,798. (The article did not indicate whether these were before or after tax, nor whether they were constant money values comparisons.)

This may seem a small reduction, but it comes, as G. Brown liked to remind us, over a period of economic growth, when incomes of those in work rose every year.

It is also over a period when the state old age pension has not kept pace with the increases in prices of goods which pensioners buy - energy and food mainly, and well below the increase in council tax.

Recent reductions in base rate by the Bank of England, and expected future reduction, will mean that savings income will fall for most of us. These reductions will be savage for pensioners who have saved all their life to provide something to supplement a disgracefully low state pension.

The message is unfortunate, - do not think that saving will be enough and do not rely on your private or occupational pension as this has been ransacked by the government. We are not saving enough, and this situation will not inspire more saving.


By the way, Harriet Harridan said yesterday that pensioners should be grateful for what the government had done for them in extra fuel allowance. If she is serious, then the increase in fuel allowance does little more than fill the gap in savings income from the fall between 1997 and 2007. I touch my forelock in thanks, Harriet.