Henry Tapper – wrinkly

The wrinklies must pull their weight – we must be a tolerant society, a mixed economy.

This is a report on a House of Lords report but is inspired by an article in the digital FT published a few hours ago.

The FT has a marvellous set of charts which (if you subscribe) you can see as one chart that explodes into the many set out below as you scroll down digitally! The message is really important, in this country, people of my age (64) who think they will put their feet up are the lucky one, there will be less comfy 70, 60 or even 50 year olds taking early retirement and we’ll be more of a burden on our children if we do. Indeed, many of us will have to come out of retirement , like one or two people my age are doing (Damion).

All of the following slides are an exploding slide – digitally – but the message is one that people need to see. It is vital if we talk of intergenerational transfers that we understand that it is not the state pension that is causing all the unfairness, nor DB/DC and CDC will only do good if it is eventually a whole of life approach (but more of that in future blogs). What really matters – these charts tell us, is that healthy people keep working and being productive to a society late into sixties.

This is not the message my generation grew up with but “early retirement” was always a lie for the mass of us.

Here goes – a progress ham-fistly by me!

By 2028, (OBR and ONS data says) tax revenues will peak from those in their forties and tail away fast from the end of our fifties. Sound familiar?

People in their sixties, like me, feel we are old enough to retire, but stopping working reduces our productivity and I suspect stores up problems for later age (hence the pension schemes bill advocates by default we take a level income from a default retirement age , determined by our workplace pension (a bit of averaging there, we are not all going to default but most will).

I think you’ve guessed what the next slide will say, those aren’t very big green bars!

That’s right, the cost of educating is as nothing to the cost of welfare needed to look after those who are over 70 and the cost of welfare to the really old is massively more than any other group, spending much of the blue box tax revenues bought in by those at work

It’s precisely the impact of healthcare which is stretching the pain from those beyond their sixties to everyone over 20. That’s the cross subsidy building

Social care, the amount spent to make life decent for some who’ve lost it, increases massively as you grow old . All this leads to the final slide, a projection into the future, where my generation will be in our 8os and 90s.

We all sense there is a problem brewing but this explanation is the best I’ve ever seen and if you are up early, you can do the progressions digitally on this link.  Thanks Valentina Romei who wrote the article surrounds it.

The trigger for FT doing this was a debate this week initiated by Lord Wood in the House of Lords.

The FT’s shows manual work but that’s FT bias, the FT should consider wrinklies my age, who advertise their departure from the workplace on Linked In wherever you look!

There is more good stuff to read if you are interested. Parliament had a select committee hearing on this in the Summer and this has led to the report presented by Lord Wood

You can download the report here 

There is of course even more bad news in terms of fertility (we aren’t having the babies that we were) but the FT finishes, as I will finish, on a happy note. As a country, we are better than many. That’s because we are a tolerant mixed economy – let’s keep it that way!

I suspect that this will be very influential on the Pensions Commission.

Stewart Wood