Retirement

PENSIONS, PRICE INDEXES AND PROBLEMS…

With big changes to the UK’s pensions system proposed, Shire takes a look at the current situation, how it might change and what impact that would have

Pensions are important for all of us – but many of us don’t attempt to understand the intricacies of the system unless we’re near or at retirement age (and sometimes not even then!). One confusing phrase is the “triple lock” : put simply, this is the system currently in place that ensures the state pension increases every year in line with the cost of living. It was brought in to make sure pensions didn’t rise higher than general incomes or vice versa. In order to calculate the state pension increase under the triple lock, three measures are used: the Consumer Prices Index to measure inflation, the average increase in wages, and a 2.5 per cent rise. These three indicators (hence “triple lock”) are looked at and the state pension rises by whichever one is highest.

Triple threat

The triple lock system has been in place since 2010 and maintaining it was a 2019 Conservative manifesto pledge. But it’s not a law and not something that has to be upheld. And recent times have forced a rethink, meaning that currently there is some debate about removing the triple lock. Because of the huge impact of the Covid-19 pandemic, which left so many people on furlough or out of work, the average wage increase

recorded as the economy starts to recover will be unnaturally high. Because of the triple lock, this rise would be the figure by which state pensions would have to increase. Forecasters at the Bank of England think that the average wage increase may be as high as eight per cent, which would be a welcome boost to struggling workers but “Recent times an extremely large bonus for pensioners too. And with the economic pressure have caused by the pandemic, some economists argue that the forced a country would struggle to afford this pension rise. rethink” It’s a difficult balance to maintain, and there are arguments for both keeping and abolishing the triple lock. Here is Shire’s quick guide to help you understand the two sides of an important decision that may be made in the next month or two.

FOR

Five reasons to keep the triple lock

1. The state pension is not that generous as it is. The average amount of basic state pension received is £96.86 a week. 2. The UK’s state pension is the 10th lowest of the 38 countries that form the Organisation for Economic Co-operation and

Development (OECD). In Spain, for example, it replaces 82 per cent of income, and 78 per cent in Austria. 3. Removing the triple lock would affect younger people, who would need to start paying more into private pensions now. 4. In 1979 the earnings link that previously calculated the state pension increase was abolished, and the value of the state pension plummeted. The triple lock was established to rebuild that value; this has begun but experts say it may take decades before it is back to the level it was before. 5. Around 1.6 million pensioners in the UK live in poverty with incomes below 60 per cent of median household income after housing costs.

Understanding pensions is essential

AGAINST

Five reasons to abolish the triple lock

1. The rise of average wages at eight per cent is not a genuine one – and not felt by the working population.

Many workers lost their jobs in the pandemic, while those on furlough lost 20 per cent of their wage. 2. When wages were static or fell in the pandemic, the triple lock meant pensioners still got their 2.5 per cent rise. 3. It will be expensive to keep the triple lock in place, at a time when we cannot really afford it. It is estimated that keeping it will cost £4 billion extra a year. 4. There are many poor pensioners but three-quarters of retired people are homeowners and often in homes bought cheaply years ago, while many young people are unable to own a home. 5. The pensions triple lock is seen as a vote-winner rather than a policy with genuine motive. Critics say the only reason the

Conservatives are so committed to it is because they get three times more votes from the older generation than the young.

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Dementia is no barrier to enjoying a rich and fulfilling lifestyle – that’s what we believe at Care UK, and it’s why our well trained, compassionate teams support residents who are living with dementia to live each day to the full.

At Deewater Grange in Huntington, we work with you to learn all we can about your loved one’s life, interests and preferences, and use positive risk-taking to enable them to keep active and engaged, enjoying maximum independence. Every day is different Living at Care UK is all about choice. Some residents do routine tasks around the home while others form clubs or run classes. Our Lifestyle teams organise varied, fun activities, from baking and arts and crafts to gentle exercise and music, and we even fulfil residents’ wishes – whether that’s enjoying takeaway fish and chips or taking a ride in a Rolls Royce. Residents are free to do as much or as little as they wish. Our care homes offer all the comforts of home, and so much more. At Deewater Grange we have our own hair salon and cinema as well as a café. We offer Namaste, where residents living with dementia can experience one-to-one sensory sessions of gentle hand or foot massages, accompanied by soothing music, aromas and lighting. Our homes also use the latest dementiafriendly technologies, from ‘magic tables’ providing easy interactive games, to reminiscence apps that spark forgotten memories. Every day is different We work with specialist interior designers and leading researchers to ensure we deliver best-practice dementia care in tailored surroundings. We’ll care for your loved one in their home’s dementia suite – a smaller community where they can get to know other residents as well as the people caring for them. All our colleagues receive the latest dementia training, and a Dementia Champion is on hand to provide ongoing training, information and support to ensure we’re always delivering best-practice care. To ensure your loved one continues to receive the nutrition they need, our chef-led kitchen teams create tasty and nutritious meals designed around your loved one’s favourite dishes, and can cater for soft-texture or fortified diets. To find out more about how Deewater Grange can help you to care for a loved one living with dementia, please call our friendly team on 01244 459559 or email donna.brown@careuk.com Deewater Grange care home Huntington, Chester CH3 6BS careuk.com/deewater-grange