Monday, 7 March 2016

Back to the future world reflected in the government's state pension review

The government has announced a review of state pensions premised on the belief that present levels cannot be afforded.

The move amounts to another piece being put into place - amid the landscape of austerity - to justify removing welfare support all together from those who cannot afford to pay. The idea of cutting pensions, whilst extending retirement age points to a time where the pension and retirement in reality won’t exist at all for many people.

The state pension was brought in during the early part of the 19th century by Herbert Asquith’s Liberal government. The opening age for retirement in 1911 was 70. Today, the level is 65, rising to 67 by 2026.  

The  theme underlying former CBI director, John Cridland’s pension review is that people could be working into their 70s and even 80s before they retire. The hardly coded message is that the government would really like people not to retire at all but die in work. This back to the future approach to the social economic landscape is being  framed in the language of austerity as in some way “progressive.”

The two main claims under pinning the proposition is that people are living longer and so pensions cannot be afforded. Both of these claims are highly contentious.

Yes it can be proved that the baby boomer generation (born between 1946 and 1964) are living longer but what of those who come after? The baby boomers are a group who had balanced diets, a fully funded NHS, the full welfare net of support and good work life balance for much of their lives.

The recent excellent BBC programme  “Back in time for the weekend” illustrated the point perfectly. A family were taken back in time to live in the 1950s, 60s, 70s, 80s, and 90s. One decade the family really enjoyed returning to was the 1970s, when they found there was more time for family, community and leisure activity. There was also more disposable income.
The family’s experiences are reflected in statistics covering the period,  which show people at their happiest in the 70s, when the gap between rich and poor was narrowest and people were getting more leisure time. Not surprisingly, there were strong trade unions and governments that were forced to consider more than the welfare of the super-rich elite.

Enter the 1980s, the neo-liberal economic model took hold, with every element of life being subjected to the great god known as the market. The market will decide what is good or bad. The ruling mantra being that to quote the Wall Street film character Gordon Gekko “greed is good.” This mantra has held sway pretty much up to the present day.

So now, the distribution of wealth in society is polarised toward 19th century levels. Instead of distributing wealth evenly, it is increasingly shovelled toward the rich elite. The mass of people now work longer hours for less money. The membership and power of trade unions has reduced. The choice at general elections is not been between parties with different idealogies but between different managers of the neo-liberal system.

It is against this backdrop that the latest attack on pensions needs to be set. Reducing the pension and extending the retirement age makes no sense in anything but crude neo-liberal terms. The pension can be afforded and retired people do play a crucial role in society. The National Insurance Fund, which everyone pays into, via their NI contributions, for pensions and other welfare support was over £100 billion in credit last year.

The idea that everyone is living so long that the pension cannot be afforded is ludicrous. The balanced diets of the baby boomer generation have gone. Many people are on bad diets, with obesity burgeoning across society. The increasingly sedentary existence caused by more and more work being centred around computers is also contributing to the obesity epidemic. Health and welfare support is being run down, poverty on the increase - evidenced by more than 1 million going to foodbanks.

There are also huge discrepancies across the country between areas and classes regarding life expectancy. The person living in Kensington may on average be living longer but what about those in Solihull or Middlesbrough – not everywhere is life expectancy growing.

There is also the point that retired people are not a drain but a contributor to the economy. They pay taxes, spend money and use services. The level of free care provided by retired people for grand children and others runs into billions of pounds if costed. Who will do the caring if those who would retire are tied to the loom until they drop?

The unfortunate reality is that what the present government are doing is following the neo-liberal model through to its ultimate conclusion. They are removing all the cement that keeps society and community together.

The health and welfare supports are being run down, prior to being totally removed. The pension is but the latest target.

Trade unions, charities and other institutions of civil society, that  have fought for these rights, have been relentlessly attacked.

The only people valued by this law of the jungle type approach to society are those who can pay their way and remain healthy. It is no way to run a society and in the long term is not sustainable. One can only hope that when John Cridland begins his state pension review he takes a wider societal view, rather than one dictated by the market based bottom line and a seeming unerring desire to go back to the 19th century.

* Back to the future of pensions - published Tribune - 18/3/2016
Government readies to pick pensioners pockets - Morning Star - 24/3/2016

1 comment:

  1. excellent article but hoping is not to leave the EU,support the doctors strike and join a union tomorrow.....