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Help young workers but don’t blame the old

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TUC, pensions conference, new briefing, Paul Nowak, women pensioners in povertyLet’s not forget that 1.5 million pensioners live in poverty – and most of them are women.

There is insufficient evidence to suggest that older people’s pensions are weighing on the wages or pension benefits of young workers, says a new briefing just published by the TUC.

While older people are on average wealthier than younger people, some degree of inequality is to be expected as a consequence of the cycle of accumulation during one’s working life and decumulation in old age.

Housing tenure, occupation and geographical location are better markers of wealth than age.

Meanwhile, the issues faced by young people should not blind us to the fact that many older people are also still facing significant disadvantage.

The poverty rate for pensioners – defined as 60 per cent of median income after housing costs–has halved since 1994/95 but still stands at 14 per cent.

This means that 1.5million pensioners currently live in poverty.

Worryingly, progress on pensioner poverty has stalled in the last five years, as a recent report, Monitoring Poverty and Social Exclusion 2016, published by the Joseph Rowntree Foundation concluded.

The paper on intergenerational inequality – Talkin’ ‘bout my generation: a TUC briefing on intergenerational issues – was published this week to coincide with the TUC’s annual pension conference held at Congress House, in London, on 1 February.

It says that:

Changes to the labour market – rather than pensions for older workers – have placed young people at the sharp end of falling pay, rising insecurity and poor retirement provision;

Pitting different generations against each other is unhelpful and divisive and risks the wider characteristics and causes of inequality being overlooked; and

A greater role for unions has a proven impact in reducing inequality.

The report calls on ministers to ensure increased pension provision across the board – rather than focusing on the distribution of an inadequate pool of retirement savings between different generations.

Speaking before the start of the conference, the TUC’s Assistant General Secretary, Paul Nowak, said: “Many young workers are unable to save for a pension because they’re stuck in low-paid, insecure work.

“But we are not going to fix this problem by pitting them against older people. Let’s not forget that 1.5 million pensioners live in poverty – and most of them are women.

“All generations deserve fair pay during their working lives and a decent standard of living in retirement.

“We must focus on the wider causes of inequality to improve pensions across the board.”

To read the full report, click here.

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