Another hidden expense for pensioners

PUBLISHED: 07:48 01 May 2006 | UPDATED: 09:12 24 May 2010

ONCE again the recent budget has allowed fiscal drag to continue to deplete pensions by failing to move tax thresholds sufficiently, resulting in more people paying higher taxes as

ONCE again the recent budget has allowed fiscal drag to continue to deplete pensions by failing to move tax thresholds sufficiently, resulting in more people paying higher taxes as the main source of revenue whereby tax allowances, if they increase at all, only go up in line with general inflation. The measly 2.2 per cent increase in pensions will fail to address increasing fuel poverty caused by up to 70 per cent in domestic fuel prices and the Governments' failure to increase the annual £200 fuel allowance for pensioners.Despite recent programmes to improve energy efficiency in households the Fuel Poverty Advisory Group's fourth annual report, published on March 14 states that numbers in fuel poverty have increased by about one million households during the period 2003-2006, doubling the number of people affected. The average annual cost of £600 for a single householder could have risen by as much as £420, (£8 a week) during this long winter. As fuel is still subject to VAT, five per cent of the cost still goes into the Government's coffers. Council taxes have increased by an average of £50 a year and the £200 election year help is not being repeated.The closure of more Post Offices and withdrawal of the Post Office Card Account by 2010 will continue to shift the £1 cost of each pension withdrawal from the Government onto pensioners, yet another hidden expense for pensioners. The free bus pass will not help those who live in areas with no buses or banks. Many pensioners are now unable to afford the extortionate charges for private dental treatment since the loss of so many NHS dentists and are at risk of undetected oral problems.The figures add up to a minimum of £14 a week. While the average weekly wage is quoted as £450, the average weekly income for those in receipt of Benefit/Pension Credit is assessed at £118 leaving a deficit of at least £11.40 after receipt of the recent 2.2 per cent increase. The true figure may be less than this as millionaires are included in the statistics. Pensioners' Voice has always campaigned for a pension of one-third the national average wage for single pensioners and one half for couples ie £150 and £225 respectively.According to Mike Warburton of Grant Thornton, while average rate of inflation is calculated at nine per cent over the past three years that figure include luxury items (such as iPods) which are reducing in price. For people on low incomes who can only afford essential goods the more realistic figure is 12 per cent while younger people has suffered relatively little inflation because their money goes on consumer goods where the "China" effect is holding down prices. Pensioners have no choice about paying council tax and little choice about heating bills if they want to stay alive. Figures suggest that a pensioner in a Band D property is likely to pay half their state pension on basic household expenses like council tax, fuel and water before they buy groceries. How can they contribute to the economy?Why does the Government not substantially raise the basic state pension instead of offering what seem like juicy little perks, 45 per cent of which remain unclaimed, because the procedure of doing so is too complicated leaving over £3m in Government coffers and "one off" payments which can be stopped at will. The fuel allowance is already worth 40 per cent less than last year.We contemporaries of Her Majesty the Queen not only endured the hardship of the great depression prior to, but kept this country going during the Second World War, which followed. Those of us who were not in armed forces were obliged to work 12 hour shifts, often seven days a week, having 25 per cent and 40 per cent income tax deducted for Saturday and Sunday work respectively. We not only survived on meagre rations of food, clothing, fuel and other essentials but endured overnight bombing often with little sleep and the loss of our homes.We must also never overlook the fact that while ever there are pensioners there will be a need for organisations like Pensioners' Voice (founded in 1939) to campaign on their behalf. I would welcome contact from over fifties to join or form new branches to lend weight to our numbers.RITA BOOTH - South West Regional Officer, Pensioners' Voice

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