Dignity and Security in Retirement
September 8, 2004 2:25 PM
By Sarah Teather MP in Asian Voice
By Sarah Teather MP in Asian Voice
Sarah Teather MP is calling for dignity in retirement
Britain is getting older. The 'baby boom' generation will soon be retiring. Better healthcare and a falling birth-rate mean that older people are living longer with fewer young people to support them. I have previously written here that immigration is one element of the solution to this problem. However, it is not the only one, not least because it is a short term fix: after all, immigrants get old too. We need to look for other ways to ensure every older person is treated with dignity in their retirement. The Liberal Democrats this week announced how we would do this, and how it would be paid for.
Our vision is of a Citizen's Pension, for all pensioners, based on a simple residency test (ie that you live here) rather than on National Insurance (NI) contributions. This would benefit women who stayed at home to look after children rather than working and who consequently did not pay their full NI contributions - righting an historic injustice in the system.
The Citizen's Pension would be paid, initially, to the oldest pensioners - those over 75 - because they are generally the poorest. It would be an increase of £25 per week on the basic state pension (£33 per week for couples). This would guarantee older pensioners within the first year of a Liberal Democrat Government an income in today's prices of £105 per week (£160 for couples): a huge increase. We would also link the Citizen's Pension to earnings to ensure its value was protected over time.
All responsible political parties need to make sure they don't make promises they can't keep. We would pay for our proposals by abolishing the Department of Trade and Industry and through savings from the Treasury and Department of Work and Pensions (DWP) budgets.
At a stroke our policy will lift 1 million pensioners out of means-tested benefits, which many find complex and intrusive, and which nearly 2 million pensioners do not claim at all despite being entitled to them.
The Citizen's Income will also especially benefit pensioners from ethnic minorities. The DWP estimates that 21% of white people are pensioners, compared with 10% of Indians and 5% of Pakistanis. This is because most immigration to the UK has taken place in the last 30-40 years, and many immigrants haven't yet had time to grow old. However, pensioners from ethnic minorities are disproportionately more likely to be among the poorest, as they have had less time to contribute to the National Insurance or other savings schemes. These citizens will benefit from our reform because they will get their pension by virtue of living in the UK now, not by having worked here for decades.
Charles Kennedy once said that 'the measure of a civilised society is how we educate our young and care for our old'. Our Citizen's Pension, when combined with our policies of free home care for the elderly and scrapping the Council Tax (which will benefit many pensioners on very low incomes) is a sign of our belief in a more civilised Britain, where the old are cared for and given dignity and security in their retirement.
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