Pensions and Income

• 2.5m pensioners are living below the official poverty line in 2007/8 defined as 60% median population income equivalent to £158 a week before housing costs).
• Between 1997 and 2006, the number of people living in severe poverty – defined as living on less than 40% of median population income – increased by 600,000.
• At least 15% of pensioners – over 1.5m older people – are living in persistent poverty (defined as living below 60% median population income for three out of the last four years).
• Pensioner poverty has risen in the last year by 300,000 - equivalent to 822 people a day - and now reaches 2.5m (1 in 4 older people). Two thirds of these pensioners are women.
• Almost two thirds (63%) of pensioner households receive the majority of their income from state pensions or benefits .
• Around 61% of pensioner couples have an annual income of £15,000 or less, and 45% of all single pensioners have an annual income of £10,000 or less.
• The basic state pension would now be £158.60 a week rather than £95.25, if the link between pensions and earnings had not been broken in 1980. Had Labour restored the link at the first opportunity when coming to power in 1997/8 the basic state pension for a single pensioner would be £100.70 rather than £95.25.
• In April 2010, the basic state pension will rise by just £2.40 a week for those with a full contribution record. For many women, this increase will be around £1.40. A retired couple’s state pension will rise from £152.30 to £156.15.
• Older people face annual inflation rates around ten times higher than the rest of the population. The rising cost of food and fuel, combined with record lows in savings returns and underperforming pensions, mean that people aged 70 and over will suffer a disproportionate increase in the cost of living.
• 58% of pensioners don't pay income tax because their annual income is below the personal tax allowance of £9490 for 675-74 and £9640 for those aged 75 and over.
• Nearly a quarter (23%) of single female pensioners have no savings at all compared with 20% for single male pensioners and 14% of pensioner couples.
• 55% of all pensioners receive £10 a week or less from savings.
• Of those with savings, 29% of pensioner couples have less than £1500, compared with 42% of single male pensioners and 48% of single female pensioners.