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Manifesto pledges in a topsy-turvy political world

Tom McPhail
government

Pensioner incomes have been largely protected from the impact of the 2008 banking crisis and subsequent recession. Over the past ten years, the state pension has been restored from around 16 percent of average full-time earnings to somewhere near its historical peak of 25 percent, last seen in the late 1970s. From Tom McPhail, Head of Policy – Hargreaves Lansdown.

The rising tide has not lifted all boats and there remain pockets of pensioner poverty which are not well-addressed through the current combination of state pension and pension credit. In addition, future pay-outs of private pensions will decline for those reaching retirement over the next 20 years, as we are passing the peak of the final salary pension system. Social care is a nettle which politicians must grasp, so it is welcome that we are now seeing this issue being publicly addressed by the major parties.”

Labour’s pledges  

  • Secure pensioner incomes with the Triple-Lock on state pensions.
  • Protect the Winter Fuel Allowance and free bus passes for pensioners.
  • An extra £45 billion for the NHS and social care.
  • No rise in the state pension age beyond 66.
  • Justice for women born in the 1950s hit by five year rise in pension age.

Labour are taking some bold positions here, which will no doubt be popular with older voters. However many independent observers have argued that the triple-lock has done its job and should now be abandoned. The state pension age freeze would either cost many billions to deliver, or would mean cutting everyone’s state pension pay-out by around £800 a year.”

We’re in a topsy-turvy political world, where Labour are proposing to preserve the Winter Fuel Allowance for even the wealthiest pensioners while the Conservatives plan to take a leaf out of Gordon Brown’s play-book and start means-testing it.

Labour’s pledge to help the WASPI women will also play well with those women affected by state pension age increases, however it will cost in the low billions to deliver and their previous suggestion of extending pension credit to help the WASPI women has already been rejected by some campaigners. Labour is very popular with younger voters so it is disappointing we have seen no proposals for helping those younger workers to save and invest for their own retirement.