Thursday 14 October 2010


Good news for pensioners is that the pension will rise to over £100 a week in April next year.

Given that inflation is well above the target rate set by the government, it is reckoned that the pension will rise by £4.49 per week to £102.14, still the lowest in the EU by percentage of the average salary at around 30%.

This will be a crumb of comfort to pensioners faced with some of the most miserable weather in the EU, with the numbers in fuel poverty doubling in the last 5 years. Add to that that energy prices are not restrained in any way, and that it is rumoured
that emergency cold weather payments are set to be cut from £25 to £8.50, and we are looking at misery for old folk who have little more than their pension to live on in a winter that is predicted to be very severe.

Of course those who were prudent and saved something for their old age are being rewarded with almost zero return on their money, with interest rates at record low, and inflation far above anything that any savings account pays.

Let’s home that
if Mr Osborne is going to reduce the amount paid as a winter fuel bonus to pensioners, that he does it only for the very richest pensioners for whom the extra £250 is of negligible interest.

According to the Telegraph, this will be the last time state pension payments will be based on RPI. The government, they say, is to switch to Consumer Prices Index (CPI) inflation starting next year. This may mean lower increases in payments from April 2012 onwards. For instance, last month while RPI was 4.6%, CPI was 3.1%.

I’m confused. I thought that that was only for other benefits. I thought too that the retirement pension was to be linked (as it always should have been) to wage increases. Of course at the moment that would probably mean what Mr Brown would call an increase of -4%.

Perhaps someone can enlighten me...?


  1. "fuel peverty" I am not in a position to critisise but.........

  2. The pensioners are set to get a good deal from the Tories. We will restore the earnings link for the basic state pension from April 2011, with a 'triple guarantee' that pensions are raised by the higher of earnings, prices or 2.5 per cent.

    No more 75p increases like under Blair and Labour! What a disgrace that was, I am still angry about that!

  3. For more on our changes [set to come in 2011 .. not this year] vist:


    p.s. Tris, this also answers that long asked question you batter me with all the time - 'when will these changes to pensions come in', well now there is an answer - 2011.

  4. The way I understand this is that the Tories will give pensioners a rise of earning, prices or 2.5% whichever is higher. But once again the devil is in the detail here. Whereas hitherto it was linked to Retail Price Index which is set in September which is 4.6%. From April the Tories will use the Consumer Price Index which was 3.1%. The office for national statistics puts the average rise in earnings for 2009 at 2%. Or of course there is the fall back of 2.5%. So as we see what they give with one hand they take back with another. This year under the scheme brought in by Mrs Thatcher when she removed the link to earnings pensioners will get a 4.5% rise but if Mr Cameron’s new scheme had been in situ they would have got 3.1%. Now there is justice for you!

    Good old nasty party we should have known better than to think they were being anything other than Tories. Looks good on paper and when Dean trumpets it about the blogosphere but when you examine it the jiggery-pokery shines right through. How easy would it have been to have set the pension rise on the highest of CPI, RPI, Earnings or 2.5%?

  5. Munguin,

    Sure it depends on which is a more accurate indicator of inflation, rather than which is higher - and therefore gives out more under the restored link?

    ... or is this little aspect of economic reality getting in the way of your anti-tory agenda?

  6. Well Dean please explain how under the old system pensioner will get 4.6% but had the new one been in place that rise would have been 3.1% that is a rise of -1.5%. So the old bad syatem that the Tories think is so unjust would actually be better than the new one that you claim is so good? Where is the economic reality in that? Unless you are in cloud cuckoo tory land that is!

    Not Tory bashing Dean but a revelation of the shocking manipulation practiced by this government and your party. I'm sorry but your claims that this government has been good to pensioners is holed below the water line. Only one left now Dean, that is the Lib Dem one of taking people with low incomes out of tax. That again the Torie claim was theirs but only after watering it down from 10k to 7k I think. Please correct me if I am wrong.

  7. Instead of all these high filutin “aspirations” why can’t the Tories simply give a cast iron promise to give the pensioners the highest rise out of all measures? Why does every Tory silver lining have to have a cloud?

  8. Thank you CH... No excuses. :)

  9. In fairness it was only once that that happened Dean, and that was because the official figures for inflation were very low.

    But while I agree that what has been promised by the Tories is better there are several caveats:

    2.5% is still only about £2.50; not much to look forward to with fuel increases of maybe 15% coming up;

    The free bus travel which they have failed to guarantee, and may be withdrawn, will make a big difference. Bus fares are outrageous. I live 10 minutes’ walk from the town and it’s £1.10 each way!! Plus, some pensioners I know take a round trip on the bus so that they get out of the house, and save on heating;

    The severe cold weather payments are likely to be reduced very substantially;

    There are hints that the winter fuel payment may be reduced or abolished... and at either £250 or £400 a year (dependant on age) that will get rid of any of the rises for the next couple of years.

    The worst thing is that no one knows and pensioners are scared out of their minds about what is going to happen.

    Unfortunately the people who make these decisions can have no idea at all how that feels. Cold to them is something they feel on the top of the Swiss mountain before they ski down.

  10. Thanks for the link Dean. I don't think though that it's an unreasonable question seeing as you always say that your lot have done it, and yet there has actually not been any change!!


  11. Munguin:

    One of the problems for the very poorest and often that will be the old, is that the RPI or CPI is a world away from their reality.

    All of these things include items which don't figure in the life of the poor.

    I noticed for example that air fares coming down had balanced the fact that vegetables had gone up, in the last figures.

    Air fares are things that don't affect the really poor. Vegetables do.

    Pensioners are often unable too, to take advantage of the BOGOF or 3 for 2, or jumbo size offers.

    So inflation for the average poorer pensioner is over 10% at the moment.

    They just keep on getting poorer, and as I say the ones that had a few thousand in the bank to pay for their funerals get almost nothing in interest.

    It's a poor way to treat old folk.

  12. Munguin,

    Free bus passes shouldn't be universal! Why on earth should a well provisioned pensioner with a villa in France be getting free bus passes?

    Helping hands and welfare from the state is for those in genuine need, not some socialist dependency culture!

    And as I say, there is no 'blown hole' in the good work this coalition is doing for our pensioners. But in anti-tory land ... well ... what is the point ...

  13. Dean when did I say anything about rich pensioners getting bus passes?

    Not anti-Tory land at all. Maybe ant-government but as I have said before you were happy enough to agree when it was the Labour Government that we slagged off and give Mr MixedPickle his due he never accused us of unnecessary Labour bashing did he? Time to step up and take it on the chin!

  14. Whilst I agree with some of the points you make Dean about people who own villas in the South of France (if you know any, an introduction would be much appreciated), the downside of means testing is that people have to allow clerks in various and sundry office see the innermost details of their bank accounts, mortgages, rent, etc, etc.

    As Mr Cameron said when the idiocy of his scheme to hit some people with the removal of their child benefit, whilst allowing people with nearly twice as much money to keep theirs....

    "People wouldn't like means testing."

    Meaning that people earning £87,000 wouldn't like it. Well people earning £8,000 are just the same as people earning £80,000; they have the same feelings, the same fears... They are just poorer, that's all.

    Why would they like it?

    And if it's true that if we are handing out taxpayers' money to them it's tough if they don't like it... then surely Mr Cameron was wrong to say that about rich people's child benefit...

  15. Well, well ,weel

    In the Mail on Sunday, there is a piece quoting unnamed senior Tories to the effect that Liam Fox, drinks too much and hangs around Americans chatting about bombing Iran.

    Seems that someone senior within the Tory party is briefing against Liam Fox.

    I thought this all went out with Gordon Brown and the Labour thugs.

    Meet the new Boss
    Same as the old Boss

    Further proof that Westminster is a corrupt festering sewer worthy of the last days of the Roman Empire.

  16. Tris

    You know one person who owns a villa in the South of France

    OK, it is a 18th Century Farmhouse and it is in Gascony, technically the SW of France but further South than Cannes.

    Bonne Soirée!

  17. Yes, I read that. He brushed it off by saying that in a powerful job there were always people out to get you... which of courwse is true. It's just not normally your political allies... not so soon after the election.

    I note that he didn't actually deny that there was a bit of a drink issue going on there.... Anyway, it doesn't much matter. He has Obama to fight his corner now, and it's a non job. The Americans make all our defence decisions for us.

    I'm not aware of anyone I know owning a villa in the South of France, or the Sud Oest...

    I mean I wish I did!!!

    Et bonne soirée à vous aussi Bugger….