The Spectator

Help the aged

Pensioners seem doomed to a retirement on baked beans — bought with means-tested benefits.

issue 11 September 2004

Andrew Smith, the Work and Pensions Secretary, resigned this week, so he says, in order to spend more time with his family. Or maybe he was peeved at some of the comments made about him by his colleagues. What is certain is that he didn’t resign for the reason he ought to have done: that the government’s policy on pensions has been a failure.

In 1997 our pension pots were brimming. Alone in Europe we looked forward to a well-heeled old age without impoverishing future taxpayers. Just seven years later, however, many seem doomed to a retirement on baked beans — bought with means-tested benefits.

The change in fortunes for pensioners, to be fair, can partly be blamed on the collapse of the stock market bubble. But this is far from the whole story. The FTSE-100 Index now stands a little higher than it did in May 1997, yet our collected pension fund assets have fallen in value from £812 billion to £708 billion.

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