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Don’t tell me pensioners have been protected from austerity

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It is not so much the “granny tax” that is making me angry but the suggestion that pensioners have been protected from the worst effects of the nation’s austerity. We are paying heavily, will continue to pay, and pay more because George Osborne thought he could slip a nasty little measure into his budget.

Pensioners who did what governments have always urged them to do and saved for retirement have seen big falls in income at the same time as the value of those savings falls.

It is simple to understand, but the defenders of Osborne choose not to. Interest rates on savings historically low while inflation coninues. At 1%, £10,000 invested produves £100 in income. Inflation is now 3.4%.

Even the functionally innumerate can see what that means. Future real income is cut by a “negative” interest rates.

Yes, this affects everyone with savings, including young people wanting to buy a home. But the elderly are mqore likely to be dependent on savings than any other section of the population.

Buying an annuity (a condition when taking most pensions) is no solution as the rates of those are also very low.

A financial adviser tells us we should be planning on the basis of my wife or myself living another 30 years. We are reminded that residential care is expensive.

So I get very angry when I hear appologists for Osborne saying pensioners have not taken their share of the pain.

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  1. TaxPay-err says

    As a 70 year old enduring the “hurting but not working” austerity cuts I am reminded of Keynes’ famous declaration that in the long run we are all dead.