- 2009 Retired Members' Conference
- 5 October 2009
Conference regrets that in his March 2009 budget, the Chancellor of the Exchequer, Alistair Darling, again failed to increase the basic state pension to at least poverty level. He pledged to raise the basic state pension in 2010 by 2.5%, even if the annual rate of inflation, as measured by the RPI is less. This will increase the full basic state pension, at present £95.25, by £2.40 per week for a single pensioner, whilst those on reduced pensions, mainly women, would get just £1.45 extra. The official poverty level for a single pensioner is £165 per week at present. £165 minus £95.25 is £69.75 per week! This illustrates just what the Government thinks of pensioners!
The latest ‘Households Below Average Income Report’ shows that 2.5 million older people are living below the poverty level, the same number as reported in 2006/2007. The worst areas are the East Midlands and Northern Ireland, each with 27% of pensioners living in poverty. Means-testing has not worked, 1.8 million pensioners don’t claim as the system is too complicated and very invasive.
This Government has completely ignored lobbies and campaigns. There is money available to pay a substantial increase to each pensioner, £46 billion surplus in the National Insurance Fund, £20 billion from scrapping higher rate tax relief on private pensions and £8 billion on removing the upper earnings limit on National Insurance contributions. Is the Government waiting for the 3 million pensioners living in poverty to die? The test of society is how it treats its old and disadvantaged, ours has failed!
The Bank of England’s response in mitigating the effects of the economic recession has been to reduce interest rates to as low as 0.5%. This has substantially reduced the cost of borrowing but at the expense of savers, and in particular pensioners, many of whom rely on interest on savings to supplement their pensions.
Furthermore, the reduction in mortgage interest has had a major impact on the Retail Price Index to which occupational pensions in the public services are linked. Most pensioners have either paid off their mortgage or rent their properties and the RPI is no longer an appropriate representative index for adjusting pensions to reflect the cost of living for pensioners.
Conference notes that in accordance with the decision of Conference last year, the National Retired Members’ Committee is seeking to establish a pensioners index to which all public sector occupational pensions could be linked.
Conference further notes that the Government will increase state pensions by 2.5% as from April 2010 even if the annual rate of inflation, as measured by the RPI is less, but there are no proposals as yet to extend this to public sector occupational pensions.
Conference therefore instructs the National Retired Members’ Committee and calls on the National Executive Council to liaise with the National Pensioners’ Convention, Trade Union Congress and all appropriate organisations to achieve an immediate substantial increase in the basic state pension to at least the poverty level £165 per week for a single pensioner, and the immediate restoration of the link to male average earnings or RPI whichever is the greater. Deferring this link to 2012 is unacceptable.
Unless and until a pensioners index is established to which all public sector occupational pensions are linked, Conference further calls upon the National Retired Members’ Committee to seek changes whereby all public sector occupational pensions increase each April by:
i.The annual increase in the Retail Price Index; or
ii.The annual increase in the Consumer Price Index; or
ii.The annual increase in average earnings; or
iv.2.5%, whichever is the highest.
Conference further instructs the National Retired Members’ Committee to communicate progress to all UNISON retired members through Interactive in March, June and September 2010.