Retired 'should work for pension'

Written By Unknown on Rabu, 24 Oktober 2012 | 15.36

23 October 2012 Last updated at 21:32 ET By Brian Wheeler Political reporter, BBC News

Retired people should be encouraged to do community work such as caring for the "very old" or face losing some of their pension, a peer has suggested.

Lord Bichard, a former benefits chief, said "imaginative" ideas were needed to meet the cost of an ageing society.

And although such a move might be controversial, it would stop older people being a "burden on the state".

The peer is a member of a committee investigating demographic changes and their impact on public services.

The panel was told that the transfer of wealth from young to old in the UK was the highest in Europe.

Lord Bichard, a former head of the Benefits Agency and top civil servant at the Education Department, who is probably best known for chairing the 2004 inquiry into the Soham murders, said the debate on rising healthcare and pension costs needed to be broadened out.

"Are there ways in which we could use incentives to encourage older people, if not to be in full time work, to be making a contribution?," he asked the rest of the committee.

"It is quite possible, for example, to envisage a world where civil society is making a greater contribution to the care of the very old, and older people who are not very old could be making a useful contribution to civil society in that respect, if they were given some incentive or some recognition for doing so."

'Tuition fees'

The 65-year-old crossbench peer, who has taken on a number of roles including the vice presidency of the Local Government Association and the chairmanship of a national after-school film club since retiring from the civil service in 2001, suggested the government should use the pensions system to "incentivise" retired people.

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The current generation are very heavy contributors to the public purse, whereas previous generations have benefited from the public purse"

End Quote Dr James Sefton Imperial College

"We are now prepared to say to people who are not looking for work, if you don't look for work you don't get benefits, so if you are old and you are not contributing in some way or another maybe there is some penalty attached to that."

He asked: "Are we using all of the incentives at our disposal to encourage older people not just to be a negative burden on the state but actually be a positive part of society?"

Prof Martin Weale, a member of the Bank of England Monetary Policy Committee, said the proposal was "outside the normal range of what is discussed", but added it was an "interesting point".

Asked about his proposal after the meeting, Lord Bichard said it was a new idea but he intended to look into it further as part of his work for the committee.

He acknowledged it would be difficult for politicians to sell to the public, but added: "So was tuition fees."

'Angry'

Prof James Sefton, of Imperial College, London, a former adviser to the Treasury, told the committee young people were effectively subsidising the older generation - and he could not understand why they were not protesting about it.

"I think they should be angry. I think the deal they are getting is poor," he told the peers.

"There are a lot of transfers going on within the system, from the young towards the old and I think awareness of it is very poor and I think eventually it will come out."

He said research he was carrying out at Imperial College, with Dr David McCarthy, suggested "the current generation are very heavy contributors to the public purse, whereas previous generations have benefited from the public purse".

This was mostly down to high house prices, high youth unemployment, rising public debt and the cost of education, added Prof Sefton, who is also a quantitative analyst at UBS bank.

The older generation benefits from public funds, in the form of healthcare and pensions, but younger people have to rely more on "private transfers" of wealth, such as family money, to a far greater extent than in other European countries, he added.


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