Inadequate income

One in two pensioners are on inadequate income says Age Concern

Single older people need between £160 (homeowners) and £200 (tenants) a week for a decent income in retirement, according to new research published by Age Concern today. But around half of all pensioners and as many as 80 per cent of those who are local authority tenants are not reaching this level. Age Concern fears current pensions policy means future pensioners may be no better off.

These findings are being released as the Government prepares to publish its Green Paper on pensions. Age Concern?s challenge to Government is to develop a pensions system which allows people to reach these standards.

The report, Modest but Adequate, is based on budget standard research methods and interviews with older people to produce detailed weekly costings of goods and services needed for a decent income in retirement. The figures provide a lifestyle above the level needed to avoid poverty but well below luxury. For example, the main budget figures include two 5 day holiday breaks in the UK but not a holiday abroad or the option of being able to run a car.

Age Concern?s new research is being presented as further evidence within the current pensions debate to show the pensions system isn?t working.

The research also illustrates the savings gap for individuals. It shows that a single tenant needs to save enough to provide an additional £142 on top of the state pension for a reasonable retirement.

Age Concern believes that central to achieving a ?modest but adequate? income in retirement is a decent level of basic state pension to act as a foundation for saving. All people should be able to build up an adequate income through a combination of state and private provision. The organisation is urging the Government to adopt the use of budget standards to inform the debate.

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