Pressures on Pensioners

A recent study conducted by the ESRI entitled “Quality of life problems differ by age group and social class” was greeted by The Irish Times with the front page headline “Young faring worse than pensioners, study shows”. Strangely, the study was published in a report by the Department of Social Protection. Was this indicative of growing pressure on the entitlements of older people?

Following the stock market crash in 2008 and the subsequent global recession, international creditors were incensed by the lavish Greek pension system, which allowed public employees to retire as early as the age of 50. Following Greece’s acceptance of the bail-out deal with the Euro zone, an estimated 45 percent of Greek pensioners’ pensions were so harshly reduced that they are now surviving below the official poverty threshold.

The Europe 2020 strategy of the European Union is to reduce poverty by lifting at least 20 million people out of the risk of poverty or social exclusion by 2020. The fact that in recent times pensioners in Europe are less likely than the rest of the population to be at risk of poverty or social exclusion is now being used by some as a reason for scrutinising pension benefits.

Phrases like “gray power”, “gerontocracy is becoming not only financially unsustainable but morally unbearable”, “pension giveaways”, “unrealistic retirement promises”, “Seniors have also been spared from the effects of the financial crisis” indicate a growing bias against the older generation.

Aside from arguments about burdening our grandchildren with debt, what’s important is that today’s youth and future generations must have at least the same opportunities to meet their own needs as the present generation. Inter-generational squabbling over current resources in a zero-sum game will not provide these opportunities. An example of how one generation is pitted against the other is the call for a radical revision of the “privileges” enjoyed by current pensioners. including the reduction of benefits.

Here is one example of the kind of “solution” that has been suggested: –
“As long as pensioners are in good health, their benefits should become conditional on work in public institutions. This work should involve the skills acquired throughout retirees’ careers.”

Now isn’t that a brilliant suggestion, seeing that Ireland has the second highest youth unemployment rate in Western Europe with up to 1 in 4 young people between 17-25 years jobless and 1 in 3 young men unemployed? We have all heard the term “bed blockers” being used to describe elderly hospital patients. Now it’s being suggested that we create elderly “job blockers”!

The competitiveness of the global market economy has social consequences in all areas of life. The goal of business has been to increase productivity through the introduction of more technology and to down-size the workforce accordingly. The result is increased joblessness which, combined with improved life expectancy, means there are fewer people of working age for every older person. So there are fewer PAYE workers to contribute the taxes needed to fund pensions and the care of the elderly.

Clearly the solution must lie in finding ways of raising additional taxes, by taxing the increased stock of wealth that is being created by technology; rather than depending solely on taxes derived from human toil.

Instead of engaging in undignified squabbles over the division of scarce resources we older citizens must maintain our dignity and insist that the solution to shortfalls in the condition of the younger generations cannot be solved by reducing or holding back improvements in services to the older generation.

The joint efforts of advocates for all age groups should be concentrated on finding means of increasing the tax base through the equitable distribution of the universal benefits of science, industry and human ingenuity that are there in abundance for all to enjoy.


About Paddy Crean

I'm an 85-year-old "silver surfer" who wants to try his hand at blogging. :-)
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