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Budget 2017 must deliver on pension pledge

Age Action has called on the Government to deliver on its election commitment to raise the State Pension by €25 over five years by providing a €5 increase in Budget 2017.

Ireland’s leading advocacy organisation for older people today set out its top priorities for next month’s budget.

Justin Moran, Head of Advocacy and Communications at Age Action, said: “Growing old in Ireland shouldn’t mean growing afraid, but it does.

“Pensioners are afraid of losing their home because of rising property taxes. They’re afraid of getting sick and relying on an ailing public health system.

“They’re afraid of being unable to afford medicine or to heat their homes. They’re afraid of going into a nursing home because there is no community care available.

“In February of this year, older people were promised that the State Pension would be increased by €25 a year over the next five years.

“Budget 2017 is the Government’s opportunity to make clear to almost 600,000 people over the age of 65 that the promises made to them will be honoured.”

During the summer hundreds of Age Action members met across the country and agreed their priorities for this year’s budget:

  • Increase the State Pension by €5;
  • Restore the Fuel Allowance and Telephone Allowance over the next two budgets;
  • An additional €73.8 million to fund 4.1 million home help hours;
  • The abolition of prescription charges for medical card holders.

Justin Moran continued: “The National Pensions Framework says that the State Pension should be maintained at 35 per cent of average earnings to keep pensioners out of poverty.

“But the State Pension is more than €13 below that target. More than 85,000 people over the age of 65 are living in deprivation and that number is rising.  

“Next month the Government can help to restore the incomes of pensioners, cut by successive austerity budgets, stand by its election pledge and deliver for our senior citizens.” 

Home supports

Age Action also highlighted the need for investment in supports to enable older people to remain longer in their homes.

Between 2004 and 2013 there was a 44 per cent increase in the number of older people living in nursing homes classified by the HSE as being ‘low dependency’. Funding for home help services fell from €211 million in 2011 to €185 million last year despite rising demand.

Justin Moran continued: “Our community care system is in crisis. Government policy says that we must support people to stay at home as long as possible.

“But the practice is to push more and more older people into nursing homes to the point that Ireland has the second highest proportion of people aged 65 and over in nursing homes and hospitals.

“The only way this is going to change is with a substantial increase in funding for home help services in this October’s budget and Age Action members will be making sure this message is heard."

As well as identifying the top priorities for older people in Budget 2017, Age Action also made individual submissions to a number of Government departments.

Age Based Analysis of Mortgage Arrears Released for First Time

We welcome the publication, by the Irish Times, of data released for the first time by the Central Bank of Ireland that shows the number of people approaching, or already at retirement age, who are dealing wtih significant mortgage debt. The information gives a clearer picture of the worrying situation for Ireland’s ageing population. Simply, a lack of evidence exists on the cost of ageing with less complete data collected about us the older we become. As a result, crucial policy decisions are made without the availability of disaggregated and representative data which can result in discriminatory outcomes. We need an urgent rethinking of how we gather evidence and inform policy that meets the needs of a changing Ireland.

While there has been an assumption that older people close to, and in receipt of, the State pension are generally mortgage-free home owners, it is clear that this is no longer true with many still carrying large mortgages, in mortgage arrears or living in precarious private rentals with no security of tenure in older age. We should all have a choice to age in place which means the creation of age friendly environments, including the provision of support services locally, which enable people to remain in their own homes and in communities for longer; but the changing nature of homeownership, rising cost of living, and the lack of a coordinated policy response to the housing crisis means many people will be facing a very difficult situation in later life. 

Many older people live in the most vulnerable situations in our society. An increasing number are struggling to meet the rising cost of living – in particular costs around rent and mortgages - in the context of a State pension that sees many surviving on incomes only just above the poverty line. Latest CSO EU SILC figures show 1 in 10 older people at risk of poverty. New taxes, and rising prices in recent years have a greater impact on older people generally living on a fixed income with limited opportunities to improve their situation. Budget 2020 saw the income of older person headed households increase by €1.08 per week for those living with another person, and by €6.08 per week for those living alone in older age. It did not offer the majority of older people the support needed to meet the increasing costs of living and it did not offer a concrete plan to support us to age in place.

Ageist attitudes towards working later in life still exist, for example many older people have reported high levels of discrimination during recruitment. Discriminatory mandatory retirement clauses are still in place forcing people out of the workforce earlier than they may wish. These two things undermine people’s ability to continue working in later life whether by choice or necessity. In the context of a buoyant labour market, we urgently need a fundamental shift in how we view and support older workers.

An increasing number of older people are experiencing fear about retirement due to worries about income adequacy. Less than half of those working have a private or occupational pension to support them in later life. While Age Action welcomes the publication of the recent autoenrolment scheme by the Minister for Employment Affairs and Social Protection which will see increased pension coverage for more than an estimated half a million workers, the current design will further drive existing pension inequalities unless there is a targeted intervention to include people in low paid jobs, particularly women and long term unemployed.

Our economy has been built on the backs of those already in, and approaching, older age: these are the same women and men who lived through the Marriage Bar, shouldered several recessions and are now dealing with the accumulated disadvantages. Successive government policies have failed to adequately plan and provide for an ageing population which will ultimately impact on all of us throughout our lives.