Disappointing Budget for pensioners

Despite Alistair Darling pledging his commitment to "tackling pensioner poverty" and promoting well-being in later life, there was little evidence of this in his first Budget.

The only new announcement in Darling’s speech was a one-off boost to the £200 winter fuel allowance, of £50 for the over 60s and £100 to the over-80s.

This move was described by Age Concern’s director general, Gordon Lishman, as: “ a spoonful of medicine to help the bad medicine budget go down”.

He added: “Although this announcement is welcome many older people will feel it is nowhere enough to address the cocktail of price hikes they have had to swallow this year."

The charity described the enhanced allowance as a short-term solution and said the government now needed to focus on finding more long lasting ways to help the 2.25million older people who cannot afford to heat their homes.

Lishman also said that the government could have done more to improve state pension provision: “It’s very disappointing that on the 100th anniversary of the state pension’s introduction, the government has missed yet another opportunity to bring forward the date to re-establish the link to earnings.

"Older people are feeling the pinch of huge hikes in living costs, yet the real value of the state pension is declining.”

Had the link between earnings and pension never been broken, pensioners today would be £50 a week better off, according to the charity. The link is set to be reinstated, but not until the end of next parliament.

In his speech, Darling also took the opportunity to confirm two previously announced initiatives – free off peak bus travel for all over-60s in England and a 20% increase to of the personal allowance of 65-74 year old, meaning this age group will need to have an income of a£9,030 a year before they start paying income tax. The government claims that by April 2009 only 41% of those aged over 65 will have to pay tax.

That's not all! For the rest of our Budget 2008 coverage, click here

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