People not pensions

“Too often social science studies pensions. But a pension is only one of a multiplicity of resources older people have.” said Professor Richard Rose in a lecture to the Department of Polical and Social Sciences on26 November.

While elderly people have a set of specific needs, they also have resources not available to the rest of the population. “When I looked at the data two or three years ago, retired people were better off than people of working age, they didn’t have a job to lose; they owned their house and had an inflation-proof income.”

Relative needs and resources change dramatically over the course of  retirement and become more extreme as people continue to live longer.  As people get older the need for social and health care increases, while money for pasttimes becomes less important.

“The most obvious change is demographic. In their 60s you’re talking about somebody who lives in a household with their spouse, they go on holidays, they are quite active,” explains Rose. “In the 70s, health and the mortality of the husband becomes important…Once over 80 two-thirds of the surviving population are women.”

According to Rose those of retirement age have three major types of need. Money, healthcare – including everyday care but also for health disasters (cancer, heart attacks, dementia and strokes), and social support.

“Sociability, being in contact with children and friends either face to face or electronically is terribly important. It’s about the balance of resources.”

“What can the state provide, what can the market provide?”

“The biggest line of the budget is pensions. From the point of view of government the pension is an output, to nearly 25 per cent of the population it’s an input.”

However, the current generation in and around retirement age is likely to live in a ‘Double Income Plural Pensions’ or DIPPE  household. “The health budget is more of a concern for pensioners. But politicians are scared to touch pensions. The political problem is path dependence. A public policy once in place tends to persist through time.”

Professor Rose is Director of the Centre for the Study of Public Policy at the University of Strathclyde, Glasgow and part-time professor at the Robert Schuman Centre for Advanced Studies.