Budget cuts – what might they mean for older people?

In recent years older people have been particularly affected by rising energy and food prices, as well as reduced income from savings. As retirement means they have less opportunity to increase their income through paid work, their financial well-being can depend on levels of state provision of pension and welfare benefits and services.

A previous JRF research programme looking at the changing needs and resources of older people provides some insight into the potential implications of government policies and budget cuts. New updates to this study have found that:

• On a positive note, the government has committed to re-link state pension to earnings with a 'triple guarantee' and a matched protection of Pension Credit. The research highlights how even small changes can make a big difference to people's budgets. As such, these measures are likely to help maintain older people’s income levels.
• However, the other side of the equation is the impact of cuts in Government spending. Those on a low income will be relatively harder hit by the forthcoming increase in VAT. It is also possible that older people's outgoings will increase if they have to pay (more) for services that were previously free or subsidised. And a withdrawal of services may affect people’s general well-being and quality of life.

The research showed how much older people valued local services, from healthcare, shops and Post Offices to hairdressers, as well as help received at home such as cleaning, gardening and warden services. Face-to-face contact was a vital part of this, especially for those living alone, and forming a relationship that developed over time helped establish trust.

• Those responsible for cuts and changes services need to consider the potential impact on the most vulnerable. While face-to-face service delivery could be seen as expensive, the value to some older people cannot be underestimated. For example, where resident warden cover had been reduced, it was those living alone with deteriorating health who most missed the human contact.
• There is a need for meaningful consultation when planning and implementing changes in services to avoid older people feeling overlooked and excluded. Ideas around 'smarter spending' include preventative early intervention integrating health, care and housing and if enables people to stay in their own homes longer could make better use of existing resources.

Older people's financial well-being depends on the interplay between finances (income/savings) and a range of other resources. Support from family and friends can be crucial helping to pay for things, initiating and encouraging people to claim benefits and grants, providing lifts, help in the home etc., all of which lessen the need to pay for services. While this help was valued, and feeds into policy ideas of encouraging individual rather than state responsibility, older people sometimes felt a sense of guilt about accepting it. It is also important that family members providing help should not be left unsupported.

For some older people the Big Society agenda could create positive opportunities (getting involved in community activities). But it could also create problems, if people felt pushed into roles they were uncomfortable with (such as being asked by others for help with financial affairs where a service had been withdrawn). Again, this highlights the need to think broadly about the consequences of changes to services, and to involve people at an early stage in a meaningful way.

While progress has been made in reducing pensioner poverty over the last decade, pensioners still do not claim all the benefits they are entitled to. This research shows that as well as lack of awareness, stigma around claiming means-tested benefit is a barrier to take-up among older people, and supports the introduction of automatic payments.

This may become even more relevant given that attitudes towards welfare receipt are built up over a lifetime. The Government focus on welfare reform, reviews of benefit eligibility and targeting benefit fraud is likely to further entrench any stigma that people may already have about benefits.

What do you think?