MILLIONS of pensioners will be plunged into poverty as the Tories press ahead with ending the triple-lock on state pensions.
The triple-lock guarantees the basic state pension increases by a minimum of 2.5%, or the rate of inflation, or average earnings – whichever is the greater.
Last week in the House of Lords the government was defeated over its plan to ‘temporarily’ suspend the triple-lock when peers voted to restore the link between pension increases and earnings instead of the Tory plan of tying increases to the low inflation rate of last year.
The Lords amendment returned to the House of Commons in a failed last-ditch attempt to prevent pensioners from being hit with pension increases that will leave them facing absolute poverty.
The Centre for Economics and Business Research (CEBR) has estimated that millions of pensioners will see a loss of £169 to their incomes next year as inflation outstrips the 3.1% increase due in April.
Even using the Bank of England’s own official figures this represents nearly a 2% cut in pensions as the Bank now expects the Consumer Prices Index (CPI) to soar above 5% early next year.
If the link with wage increases still held the increase in pensions would have been over 8%. Even an 8% increase would have failed miserably to make up for all the years pensions have been kept at poverty levels in the UK.
Contrary to Tory boasts of ‘world beating’ pension provisions the fact is that UK pensioners receive about 27% of the average working wage on retirement compared to over 50% in Germany and over 40% in France. Now they will be driven even deeper into poverty.
CEBR economist Sam Miley said: ‘Pensioners will be particularly vulnerable to rising prices due to the fact that their disposable incomes tend to be lower in the first place. Meanwhile, the nature of inflation at present being heavily concentrated in utility prices, is also set to adversely affect pensioners, given that this makes up a relatively larger proportion of their overall spending.’
Energy, food and housing costs – those items of spending that take up the greatest proportion of the costs for pensioners on the lowest income – are shooting up while pensions are being held down, condemning millions of those relying on state pensions to having to choose between eating or heating their homes and paying the rent. While the Tories are targeting pensioners, the employers are waging war on the occupational pensions of workers.
London Underground train drivers have been targeted by both the Tories and the Labour-controlled Transport for London for cuts to their pensions and working conditions in order to ‘plug the funding gap’ on London’s transport system.
Last week, Tube drivers, represented by the union Aslef, voted by a massive 98.8% to support strike action against these plans.
Lecturers, researchers and other academic staff members of the UCU union voted this month by 76% for industrial action over cuts to the Universities Superannuation Scheme which would reduce their guaranteed retirement income by 35%.
Workers know that state pensions, paid for by their National Insurance contributions, and occupational pensions, paid for out of their wages, are the only protection afforded to them in old age. These are not a gift from the capitalist class but a right that was fought for and won by the trade union movement in the past.
Now this right is being attacked by a Tory government determined to make pensioners and workers’ pay for the trillions of pounds spent bailing out this bankrupt capitalist system.
Every ballot carried out over pension cuts has produced an overwhelming response from workers – they are determined to defend their pension gains.
Workers and pensioners face the same enemy – a Tory government and a capitalist system determined to force them into poverty in order to bail out the bosses and bankers.
The working class and pensioners must unite and demand that all these strike ballots be carried out and action taken and coordinated into a general strike to kick out the Tories and bring in a workers’ government and socialism.
Since capitalism cannot afford proper pensions it must be overthrown and replaced by a workers’ government and a socialist system of society!
