Ishares Age Pop Discussion Threads

[waldron] 10/9/2005 09:49

Jailed council tax rebel 'has no regrets'

Hélène Mulholland and agencies
Thursday September 8, 2005


A retired vicar who refused to pay his full council tax in protest over rising bills has no regrets over going to jail for his beliefs, his wife said today.
Una Ridley said her husband Alfred, a 71-year-old former Church of England clergyman, was "bearing up" last night after beginning a 28-day sentence at the category A Woodhill prison near Milton Keynes, which houses some of the country's most violent offenders.

Mr Ridley was jailed over his decision to protest against the council tax, which he believes is unfair on people on low fixed incomes.

His decision to make a stand let to him receiving a 28-day suspended sentence in July for declining to repay the £691 he owed in arrears and costs.

Mr Ridley's local council tax bill rose by 8.5% last year but he declined to pay the full sum.

He followed advice from a campaign opposing council tax increases, IsItFair?, and paid the previous year's bill plus 2.5% extra to cover inflation. That left him £63 in arrears. The additional charges were incurred through court and bailiffs' costs.

Mr Ridley went straight to jail yesterday after he refused again to comply with the order and told the court he would not pay an "illegal council tax demand".

Speaking earlier today, Mrs Ridley said she and her husband had never spent such a length of time apart before. "There is a gap next to me in my bed and there is this guy who I talk to quite a bit and I miss him very much," she said.

Despite his advancing years, and a minor heart condition, Mrs Ridley said her husband was coping well with prison life so far. He is sharing a cell with a man older than himself.

"Yesterday was very hard for him," she said, "I am glad he did not cave in.

"He was scared before he went in because it was unknown to him - it certainly wasn't a pleasant experience.

"He does not regret anything. He is keeping calm and steady to pass this thing through."

Providing he gets his medication, she added, the former public schoolboy who did national service in the marines should cope with prison life.

And she attacked the choice of prison as "extreme".

"It is not even a crime, it is an offence in my view," she said. "It is ridiculous."

Speaking from the couple's home in Towcester, Northamptonshire, today, Mrs Ridley said she plans to visit her husband tomorrow and vowed to continue the campaign against the "unjust" tax.

She said: "The greater issue is to get a fair council tax system sorted out, that is the serious issue.

"We look shabby; our paths are overgrown, the streets are not swept and rubbish only collected once a fortnight.

"Councils are not giving us true value for our money so we have to do these extraordinary things.

"We did try very hard before we went on this journey to get reasonable people - MPs, the council, people in authority - to listen to us."

Prison reform charities and pensioners' rights groups have condemned the decision to jail Mr Ridley, who refused to pay in order to highlight what he said was an unfairness in the system.

Another member of the IsItFair? campaign group, Sylvia Hardy, from Exeter, is due to appear in court next month on smiliar charges.

[waldron] 08/9/2005 07:28

U.K.'s Tax Credit System Is a `Nightmare,' Lawmakers Say
Sept. 8 (Bloomberg) -- Britain's tax credit system, which paid 16 billion pounds ($29 billion) in the last fiscal year, wasted public money and is a ``nightmare'' for poor people claiming benefits, an all-party panel of lawmakers said.

The House of Commons Public Accounts Committee, which probes government spending, concluded the system is too difficult to administer and prone to errors. In June, Prime Minister Tony Blair apologized after government attempts to claw back tax credits paid in error plunged many households deeper into financial distress.

``The introduction of Inland Revenue's new tax credit system has been a nightmare,'' said Edward Leigh, chairman of the committee and a member of Parliament from the opposition Conservative Party. ``A flood of public money is being wasted.''

The comments from a committee dominated by lawmakers from Blair's Labour Party are a blow to Chancellor of the Exchequer Gordon Brown and the Treasury, which designed the system to help spur people on jobless benefits back to work. Blair won a third term in office in May on pledges to broaden benefits and tax credits for working families.

The Treasury on June 22 said it overpaid at least 1.3 billion pounds in benefits during the fiscal year through March. The government has already written off 51 million pounds that it says will be uncollectible.

Blair in June told Parliament ``there are serious issues to be addressed'' in the system. Brown asked junior Treasury ministers and officials from the Inland Revenue tax collection agency to explain the problems.

`Fiasco'

``Gordon Brown's tax credits have turned into a fiasco,'' said George Osborne, the main opposition Conservative party's spokesman on finance. ``It is scandalous that a system designed to alleviate poverty is causing so much distress.''

Today, the Treasury issued a statement saying it would respond to the report in the coming weeks and that some changes already have been made.

``We have already put in place many improvements to deal with the problems,'' said David Varney, who heads Inland Revenue. ``We reject any assertion that overpayments have occurred because the tax credit scheme is either `unduly complex' or `hard to implement.'''

He said 6 million families depend on the payments and most had no problems.

The tax breaks, so-called Child and Working Tax credits, had made a fifth of Britain's 60 million people better off by about 1 percent, a report by the Institute of Fiscal Studies on March 30 said.

Electronic Data Systems Corp., the world's No. 2 computer- services company which built the tax credits computer system, was responsible for some of the problems, the Treasury said. The system is now being maintained by a consortium led by CapGemini SA, Europe's biggest computer-services company.

[maywillow] 04/9/2005 07:05

OAP's protest signals unrest over rise in council tax bills

TERESA HUNTER


PROTESTS at soaring council tax bills will intensify this week when retired vicar Alfred Ridley is hauled back into court and may be sent to jail.

Ridley, of Towcester, Northamptonshire, was given a 28-day prison sentence in June, suspended for 28 days to give him time to pay the outstanding debt of nearly £1,000.

Alfred, 71, and his wife Una, 72, had fallen behind with their council tax after taking part in a campaign of passive resistance and restricting their monthly payment to last year's tax, uprated for inflation.

As the magistrates are closed in August, Ridley will be brought before them on Wednesday when he will again refuse to pay the amount outstanding.

Alfred and his wife are prepared for him to go to jail. The retired vicar said: "Someone has to make a stand. At my age it doesn't matter, I have nothing to lose. But it is a point of principle and I am not going to pay up.

"I don't know what is going to happen. In some ways I would rather go to jail and be finished with it.

"It has been dragging on for a year now and every time they take me to court the debt increases as they bill me for their costs."

Anger is mounting in many parts of Britain about the substantial rise in council tax of up to 80 per cent since 1997.

There was an outcry when properties were revalued two years ago in Wales, and roughly a third went up a band, with some moving up two, three or four bands.

A similar exercise is now underway in England where the fear is that bills will rocket again when the current revaluation process is concluded.

Millions of households are destined to be affected, with the tax for a typical band D property expected to go up from £1,214 to £1,484, when the first demands go out in 2007.

Christine Nelson, of the Is It Fair campaign, said: "We've already seen what happened to many people's bills in Wales after revaluation. Some properties went up by three or four bands.

"Most households have no idea what's about to hit them. If what happened in Wales happens here, there will be a riot."

The Scottish Executive has commissioned its own review into local government finance, which is examining, among other matters, a potential revaluation exercise.

Campaigners are expected to flood to Towcester magistrates court to support Ridley.

[grupo guitarlumber] 16/8/2005 09:25

Plans for deferred council tax
Steve Doughty, Daily Mail
16 August 2005

LABOUR has devised a 'death tax' to relieve the huge pressure of council tax on older people.



REBEL YELL: A vocal Elizabeth Winkfield of Devon has famously been taken to court twice for failing to pay her council tax.

Council taxes have increased by up to 70% since Labour came to power in 1997 and pensioners have been among the worst hit.

The burden has fallen hardest on people in rural areas of southern England where many retirees live.

Many couples still in large family homes have found themselves facing soaring council tax bills while trying to live on fixed incomes.

The 'deferred payment' system would remove the immediate burden but allow local authorities to cash in later. Those who own their homes could choose to pay less or avoid the tax altogether.

Councils would then claim back all the tax owing when they die from the value of their home. Their children would pay in full, with interest, when they inherit the property.

But the accumulated tax bills are likely to be very high. According to the Government's figures, an average 'Band D' bill of £1,214 a year would mean a debt to the local council of £21,251 after ten years and £75,986 after 20 at current UK gilt rates of 4.37%.


Last night, the Tories condemned the proposal. Local Government spokesman Caroline Spelman said: 'This is just a gambit by the Government to tax the uplift in property prices since the 1990s.

'Already under Labour, the number of households paying inheritance tax has doubled. Now pensioners who have worked hard, saved and invested in their homes over a lifetime are the prime target. It's a sinister death tax by any other name.

'I fear that the elderly, struggling with soaring council tax bills, will be pressured into signing away their homes to the taxman.'

The scheme has been put forward in time to be included in reforms scheduled for 2007. Many of the reforms are expected to target those homeowners whose properties have increased most in value over the past ten years.

The Government is pushing through a revaluation of every home in the country. This is likely to mean higher bills for many and will penalise in particular those who have improved their homes with conservatories, extensions or parking areas.

Reforms may also include rebanding so that those whose homes have gone up most in value in recent years would pay more.

Former Labour councillor Sir Michael Lyons is also conducting an independent review of council tax. His report is due in December.

Sir Michael is considering reforms including a homeowner tax under which property owners would pay more than those who rent. The 'death tax' idea has been put forward in documents published by Northern Ireland finance minister Ian Pearson.


Suspension of the Northern Ireland Assembly means Westminster has full control of local taxation and the Government is using the province as a test bed for local tax reform ideas.


Mr Pearson's paper said: 'The Government recognises that some pensioners who are better off may wish to defer payment or all or part of their rate bill until the sale of their property.'


The death tax idea has been championed by Professor John Muellbauer, an Oxford academic who has carried out a series of projects for Chancellor Gordon Brown. He has said: 'The elderly should be offered the option to build up a council tax charge with accumulated interest to be settled upon the sale of the dwelling or the death of the surviving resident spouse.'


But the plan will dash many children's hopes of inheriting the home they grew up in. About 39,000 families pay inheritance tax each year, twice as many as a decade ago.


Many elderly people are already being forced to meet the cost of residential care out of the value of their homes. This will decrease the amount they can leave to their families still further.

[maywillow] 02/6/2005 05:57

Australia 'appalled' at cost of topping up UK pensions
By Ava Hubble and Becky Barrow
(Filed: 31/05/2005)


The Australian minister responsible for the frozen pensions issue, Senator Kay Patterson, is noted for her unemotional, business-like manner. But she exploded last week when asked to comment on the dismissal of the Carson appeal. "I am appalled," she protested. "I am outraged.

"How can this happen in a democracy? How can you justify penalising contributors to a mandatory pension scheme? It is morally indefensible. I am writing to everyone."

She was asked if those she intended to complain to included the Prime Minister, Tony Blair. "I am writing to everyone, including the judges - the Lords" she insisted.

The two Australian frozen pensioner organisations, the Sydney-based British Pensions in Australia group (BPiA) and the Adelaide-based British Australian Pensioners Association (BAPA), have indicated that they plan to pursue the case.

They hope the Australian government will consider contributing to their funds.

"That's a big ask," protested Senator Patterson, who pointed out that for decades Australia had been providing supplementary pensions to impoverished Britons.

She reported that 169,000 of the 236,423 Britons currently living in retirement in Australia are now in receipt of a partial, means-tested Australian pension. The cost is currently about $A106 million annually and, unlike the frozen pension, steadily increasing with inflation.

"Who or what will move the British government?" she demanded. She ran through a list of the Australian prime ministers, foreign ministers and ministers for family and community services who have trudged "back and forth" to Whitehall over the decades, pleading for a rescindment of the policy.

In 2001 Australia introduced legislation that now prohibits newly arrived British retirees from making any claim for Australian social security assistance for 10 years. Australia indexes the pensions of all its expats.

Despite making full National Insurance contributions throughout her working life, Mrs Carson's pension will never rise above £103.62 because she lives in South Africa. If she returned to Britain, it would be instantly raised.

Mrs Carson said: "I can only say that from my point of view it is heartbreaking news for all the very elderly pensioners who are in countries like South Africa and especially Zimbabwe who can't make ends meet. They have difficulty feeding themselves and providing medicine when they are sick. They have been hoping that their position might be alleviated by the House of Lords and they have all been let down."

Mervyn Kohler, head of public affairs at the charity Help the Aged, said: "It is symptomatic of the Government's general view of pensioners that it tries to provide people with the most modest resources that it thinks it can get away with."

The four law lords who rejected Mrs Carson's appeal were Lord Nicholls of Birkenhead, Lord Hoffmann, Lord Rodger of Earlsferry and Lord Walker of Gestingthorpe. The dissenting judgment was by Lord Carswell. For the full judgment click here

[maywillow] 01/6/2005 06:15

Retired people forced back to work

Millions of pensioners are having to slash their spending or return to work to make ends meet, a report has claimed.

One in 10 pensioners now live on less than £5,000 a year, while nearly a quarter survive on less than £7,500, according to insurance giant Prudential.

The group said an estimated 2.1 million pensioners had been forced to cut back their spending on holidays, while the same number were eating out less and 1.8 million were spending less on entertainment and leisure activities.

More worryingly, large numbers of people were also being forced to cut back on essentials with an estimated 1.7 million people saying they now spent less on clothing and 1.2 million are trying to reduce their heating bill.

About 740,000 retired people also said they were trying to spend less on food, while 430,000 were even cutting back on medicines and visits to their GP.

At the same time an estimated 1.4 million retired people said they had been forced to return to work in order to increase their income, while others have rearranged their investments, borrowed money from the bank and in some cases even turned to gambling.

Angus Maciver, Prudential's director of customer insight, said: "People reaching retirement age can now expect to live another 20 years, something that people tend to underestimate.

"Unless people start to plan and save more, the increasing poverty we see affecting today's pensioners will become endemic."

Pensioners in the East of England are most likely to face financial hardship, with 28% saying their income is not enough to make ends meet, followed by those in the Midlands at 26% and people in Wales and the South West at 23%.

Retired people in Lancashire are the best off with only 6.4% saying they are struggling to get by on their income, something 11.5% of people in London say they are doing.

[maywillow] 27/5/2005 06:26

Expat loses pension increase case

Annette Carson lost her case in the House of Lords
A case that could have led to a rise in the pensions of nearly half a million Britons who retired abroad has been rejected by the House of Lords.
Annette Carson, who emigrated to South Africa in 1989, wanted her state pension to rise in line with prices.

However, the judge described Ms Carson's claim as "unjustified."

UK expats living in the EU have their pensions increased while those living in some Commonwealth countries have their pensions frozen.

Some expats may be thrust into poverty by this decision

Age Concern spokeswoman

After emigrating, Mrs Carson continued to make full contributions to her UK state pension and, on retirement in 2000, began to receive pension payments.

But since then the UK authorities have refused to increase the level of payments, and Ms Carson's pension has been frozen at £67.50 a week.

The judge in the case, Lord Hoffmann, said that, as the law stood, it would remain frozen.

He added her sense of grievance "may be understandable, but it is not justified".

Bilateral agreements

Ms Carson is among an estimated 490,000 British pensioners who live overseas and have had their pensions "frozen" at the rate that they were first paid abroad.

WHERE ARE PENSIONS FROZEN?
Australia
Canada
Hong Kong
South Africa
Zimbabwe
New Zealand
Trinidad & Tobago

Under bilateral agreements with countries including US and EU members, the government has upgraded pensions for British people who retire there.

But social security agreements with other countries such as Canada, South Africa and Australia were drawn up much earlier, in the 1950s, before inflation became such an important issue.

Critics of the current system believe it is an unfair lottery - and penalises people who have paid national insurance contributions all their working lives.

It can mean some of the oldest pensioners in mainly Commonwealth countries are left on a basic pension as little as £7 per week - less than a tenth of the current level.

"The result of this case is disappointing, it means that you can retire to one country and have your pension uprated but not to another," a spokeswoman for Age Concern told BBC News.

"Some expats may be thrust into poverty by this decision."

Ms Carson first brought her case in 2002 but lost. In 2003 she won the right to appeal against the decision in the House of Lords.

[maywillow] 27/5/2005 05:52

Lords reject index link for expats' pensions

Rupert Jones
Friday May 27, 2005
The Guardian

A claim that more than half a million Britons who retired abroad should have their pensions increased in line with inflation was rejected by the law lords yesterday.
The House of Lords dismissed an appeal by Annette Carson, 64, who now lives in South Africa. She has been leading a campaign to overturn UK government regulations which she claims result in 540,000 expat pensioners receiving lower state pensions than their counterparts residing in Britain and some other countries.

Mrs Carson claims the government is guilty of unlawful discrimination. Under the rules - which the government has conceded are "illogical" - British expats in countries such as Australia, Canada and South Africa do not see their state pension increased annually in line with inflation, as happens in Britain and the EU. Lord Hoffmann said her sense of grievance "may be understandable, but it is not justified".
Graham Chrystie, who is representing Mrs Carson, said: "There is a possibility of going to Strasbourg."

[grupo] 11/4/2005 12:35

April 10, 2005

Elderly expats await Lords verdict on 'discrimination'
540,000 Britons who are resident in Commonwealth countries want a fair deal, writes David Budworth



MORE than half a million British pensioners who have retired overseas are anxiously waiting to hear if a legal battle to upgrade their state pensions has been successful. The House of Lords ruling, expected next month, could increase annual payments by hundreds of pounds.
Annette Carson, 64, who has been living in South Africa since 1989, is leading the campaign to overturn UK regulations that result in about 540,000 expatriates getting lower state pensions than their counterparts in many other parts of the world.



Pensioners retiring anywhere in the European Union, America and countries such as Israel and Barbados have their state pension increased each year in line with prices, just like a pensioner who stays in Britain. But those living in most Commonwealth countries, including Australia, Canada, New Zealand and South Africa, do not. Their state pension is frozen at the moment they retire, or when they leave Britain if they have already retired. Over time, that results in a pension that falls further and further behind the uprated version.

Carson's pension is frozen at £67.50 a week, the going rate when she retired. But if she still lived in Britain, or any of the countries where state pensions are uprated, she would now be receiving £82.05, the rate for the tax year that has just begun.

And her situation is by no means the worst. A couple in their late eighties living in South Africa will receive only £14 a week, while in the UK their weekly payment would be more than £130. Carson claims this is "unfair discrimination". She lost an earlier case in 2003, and expat supporters fear the ruling will go against her again.

More than 1m British pensioners have chosen to live abroad and the numbers are expected to soar in the next decade. But as the Carson case shows, it is often neither simple nor straightforward.

Debbie Falvey, head of retirement planning at Prudential, said: "It is vital to research your chosen destination before taking the plunge. Local taxes, costs of professional services and even healthcare need to be taken into consideration to ensure you don't get any nasty surprises."

You can claim the state pension from anywhere in the world. The money can even be paid straight into an overseas savings account, if the receiving bank allows it.

Some company and personal pensions can also be paid overseas. If not, you can use cash machines abroad to access money from your UK bank. It may work out cheaper to set up a foreign account and transfer the money, but it is still costly.

If you wanted to transfer money to a Spanish bank account, Lloyds TSB would charge up to £30 and HSBC as much as £21. Moneycorp's standard fee is £15, although it offers a regular-payment plan with a fee of only £4. Transfers from a Halifax or Bank of Scotland account to Banco Halifax España are free.

Overseas banks tend to pay lower rates of interest than in Britain, so you may want to leave your savings with a UK bank. Alliance & Leicester pays 5.35% on its UK easy- access internet account, compared with Banco Halifax España's top rate of 2%.

British pensioners officially resident in another EU country have the same entitlement to healthcare treatment as a national in the country they are living in. But be aware that free services may not be the same as those in the UK.

You need to fill in form E121 before you go. Once you arrive in your new home give the form to the authorities who run the sickness-insurance scheme. Outside the EU you are unlikely to be entitled to free healthcare, so private medical insurance is vital. If you already have it, you will usually have to switch to an international policy.

If you are looking for cover, brokers such as PHA Expat (0870 7700 946) specialise in searching for the best deal. For advice on getting your state pension paid abroad, and to request an E121 form, call the International Pensions Centre on 0191 218 2828.

[maywillow] 21/3/2005 06:35

OAPs 'facing council tax poverty'

Help the Aged is lobbying a Holyrood committee
Hundreds of thousands of Scottish pensioners could be living in council tax poverty, campaigners have claimed.
Help the Aged said 70% of those who took part in a survey fell into that category as their bills accounted for at least 10% of their income.

More than 50% said they had been forced to cut their budgets for things like food and heating to afford tax rises.

The organisation, which sent the survey to 1,000 people, wants the Scottish Executive to find out the real figure.

A report based on the survey has been submitted to the local government finance review committee.

Members of Older Peoples' Forums across Scotland were asked how council tax and water rates increases had affected their lifestyles.

Our findings have alarmed us, and we are now worried that hundreds of thousands of Scottish pensioners could be living in council tax poverty

Richard Meade
Help the Aged

On average, these charges accounted for 13% of their net income.

Help the Aged said that council tax benefit provided a "welcome relief" for some people.

But it said: "A large number of pensioners entitled to the benefit do not claim it, mainly due to a lack of awareness and long, complicated forms."

Scottish policy and parliamentary affairs officer Richard Meade said: "Our findings have alarmed us, and we are now worried that hundreds of thousands of Scottish pensioners could be living in council tax poverty."

Help the Aged has produced thousands of postcards urging members of the Holyrood committee to consider the impact on pensioners when making its recommendations to the executive.

These will be distributed to older people, who will be asked to send them to the committee.

[maywillow] 03/3/2005 07:30

LONDON (AFX) - Funeral-related services provider Dignity PLC reported a rise
in full-year pretax profit before goodwill and exceptionals to 22 mln stg from
16.8 mln a year earlier, while sales rose 5 pct in the period to 135.7 mln.
Results were slightly ahead of expectations despite a lower than anticipated
death rate, the group said in a statement.
Chief executive Peter Hindley said: "The group continues to trade well and
we expect to make further progress in 2005."
Dignity plans to pay a final dividend of 3.75 pence a share, making a total
of 5.625p.
It added it will seek to achieve growth by a combination of further
acquisitions, opening new locations and seeking further partners for its
pre-arranged funeral plan business.
[e-mail]
lam

[ariane] 28/2/2005 07:03

Expats fight 'injustice' of state pension
By Harriet Meyer (Filed: 28/02/2005)


About 500,000 people who had their state pensions frozen when they left Britain to retire overseas will have their appeal against this "injustice" heard by the House of Lords today.


Annette Carson: pension frozen at 2001 level
Those affected include people in their 80s who receive pensions of £14 a week, whereas they would get £140 a week if they had remained in the United Kingdom or any of the countries where state pensions are uprated in line with inflation.

Pensioners retiring to America and any European Union country have their state pension uprated in line with the Retail Price Index.

However, more than half of the 930,000 British expats living overseas do not receive the annual uplift, nor do they receive the annual £200 winter fuel allowance. The majority of those affected live in Australia, Canada, New Zealand and South Africa.

Annette Carson, 64, who has been living in South Africa since 1989, has been fighting the Department for Work and Pensions in the courts. She is asking that regulations barring her from receiving her full UK state pension rises are declared unlawful. Miss Carson's pension is frozen at the 2001 level of £67.50 a week, but if she still lived in the UK she would now be receiving £79.60, with a further increase due in April.

She lost her case in the Court of Appeal in June 2003, but the Appeal Committee of the House of Lords granted leave to appeal to the Lords, and her case is due to be heard today.

Graham Chrystie, of law firm Thomas Eggar, is representing Miss Carson. She has already had two rulings made against her, and costs awarded against her. Mr Chrystie said: "Over 500,000 UK pensioners living abroad are getting a much lower state pension than if they were living in the UK.

"If Annette Carson's appeal is successful, this injustice will be remedied – at small cost to the Government but with enormous benefit to a great many needy pensioners."

The Department for Work and Pensions estimates it would cost between £300m and £400m annually to uprate all frozen pensions for those who retire overseas. A spokesman said: "We wouldn't want to comment prior to a case being heard and a judgement being made.

"Where there is a legal requirement to uprate UK pensions or where the government has a reciprocal agreement in place with other foreign government, state pensions are uprated."

[ariane] 27/2/2005 08:14

Grey matters



--------------------------------------------------------------------------------
Parties scramble to woo older voters on council tax

Neesa MacErlean
Sunday February 27, 2005
The Observer

Will pensioners be bought off in this general election by the promises being made by the political parties on council tax? That is the big question facing parties and pensioner groups.
If the current jockeying for position were being played out in a simpler format - say as employers and employees in wage-bargaining - the primary focus would be on pay (the basic state pension and other income) rather than the cost of living (issues such as council tax). But the parties have preferred to focus on the cheaper of these two issues - so council tax is pushed to the fore.

Last week the Conservatives announced plans costing £1.4 billion to restrict council tax bills to £500 a year for the estimated five million pensioners who live in households where all adults are 65 or over.

The government is fighting on different fronts - including giving pensioners cash to help with the council tax bills, threatening rate-capping on local authorities that bring in higher rises, and giving an extra £1 billion to councils this year to reduce the need for high increases.

By contrast, raising the basic state pension (BSP) from £79 a week to £105 - a level thought a reasonable aim by many in the industry including the National Association of Pension Funds and the National Pensioners Convention - and giving it in full to all pensioners, would cost between an estimated £9bn and £14bn a year.

The Conservatives and Liberal Democrats' pensions policies improve on the current BSP but do not go anywhere near this far. The Conservatives confirmed their pensions policy last week - relinking the BSP to wages inflation at a cost of up to £3bn a year - but their main emphasis was on council tax.

Meanwhile, Tony Blair and his ally Alan Johnson, the Secretary of State for Work and Pensions, want to be more generous than Chancellor Gordon Brown. Last week a statement from Johnson left the door wide open for an overhaul - including the possibility of easier entitlement to the BSP - some time in the next parliament.

When you look at the voting figures, there is no surprise that the parties court the grey vote. In the 2001 general election, the 65+ age group was the most likely to visit a ballot box - with 87 per cent doing so. Only 53 per cent of 18-24-year-olds did the same.

The signs are that those positions could be even more polarised in the election this time around. When pensioners think about council tax issues and whether this should affect their vote they should consider:

· The BSP is due to rise 3.1 per cent in April - by £2.45 to £82.05 a week for single pensioners (and by £3.95 to £131.20 for couples).

· Council tax increases will be finalised and announced by 11 March. The government is expecting that these will average 4.5 per cent.

· The average pensioner couple will see a fifth of their basic state pension increase absorbed by the council tax rise. (The current average council tax bill is £967 - and a 4.5 per cent rise adds 83p to that each week.) Increases in utility costs could absorb most of the rest of the increase in the BSP.

· Last year's council tax increases - averaging 5.9 per cent - were the lowest in nine years, and the government expects this year's to be the lowest in a decade.

· Next year's council tax rises are unlikely to be as low as this year's.

· A revaluation exercise - due to peg all properties to their value as at this April - could lead to substantial council tax increases from April 2007 in areas where house prices have soared.

· Help the Aged and the National Pensioners Convention have welcomed the short-term effects of the Conservatives' proposal, but want fundamental reform and a fairer system, not a tweaking of the status quo.

And if you want to see a microcosm of the political games over council tax, look to Exeter where Sylvia Hardy, the pensioner who is ready to go to prison for non-payment of £63 in council tax this year (the amount by which the tax increase exceeded her pension hike) has been told by the bailiffs threatening her that the council (whose leading group is Labour) has asked them to hold off for the time being.

No action is expected for a couple of months - and that would take us into May - and probably beyond the general election.

[maywillow] 25/2/2005 08:47

Vouchers 'to cut winter deaths'

Some pensioners still struggle to keep warm, say the Lib Dems
Pensioners are being promised energy savings by the Liberal Democrats, as snow and cold temperatures continue.
The party says the plans could save the average pensioner £100 every year and cut winter deaths.

The government gives £200 for winter fuel to households with people over 60, or £300 where people are over 80. The Tories promise to keep the payments.

The Lib Dems would allow people to swap these winter fuel payments for discounts on home insulation.

Shadow local government secretary Ed Davey said: "The current scheme has helped some older people, but this new Liberal Democrat approach will go much further to end the scandal of tens of thousands of old people dying from the winter cold every year."

The vouchers are designed to let pensioners choose from a list of approved energy supplies who would compete for business by offering discounts on home insulation schemes.

The plan would boost energy conservation, says the party - and insulation could save £100 every year for pensioner households, so using the money more "intelligently" than at present

[maywillow] 21/2/2005 10:10

Tories pledge £500 cut in council tax for old
By Joe Murphy, Evening Standard, Political Editor
21 February 2005
Millions of pensioners would have their council tax bills slashed in half under Tory plans unveiled today.

Setting out his first firm tax cuts pledge, Michael Howard offered up to £500 in discounts to five million over-65s. His plan targets older people on fixed incomes who resent soaring council demands.

Mr Howard said his 50-percent discounts would be funded in the first Conservative Budget if the party wins the general election. The giveaway would reverse eight years of steady increases in local authority bills since 1997.

A couple whose bill is currently £1,167 for a typical Band D home now would see it fall to £667, down by £500. A single pensioner with a bill of around £876 would get a full 50-percent reduction to £438.

On average, pensioners would be £340 better off, the party said - but poorer households would gain proportionately more than the wealthy. The maximum discount would be capped at £500.

Crucially, the rebate would not affect means-tested benefits, so pensioners' gains would not be clawed back by the Government. And the full cost would be borne by the Treasury, rather than pushing up other council tax payers' bills.

It is the first concrete proposal to share out the £4 billion earmarked for tax cuts by Mr Howard and shadow chancellor Oliver Letwin. The rebates will use up a third of the cash, but have been carefully tweaked to get maximum political bang for buck.

Mr Howard said the issue would be a top priority for a Tory government.

"We think older people in our country need dignity, respect and security," he said. "We owe them a great deal - many of them fought for the freedoms we enjoy today. I think you can tell a lot about a country by the way it treats its older people."

He said Labour had used the council tax as one of its most unfair stealth taxes. And he admitted being "wrong" about the poll tax, "a mistake" which he helped to bring in.

According to Tory figures, a pensioner couple in a typical Band D home is paying £478 a year more now than eight years ago. Single pensioners are paying £359 more.

But only households where every person is aged over 65 will be allowed to claim the Tory discount. Pensioners with younger spouses or working children living with them would not benefit.

[ariane] 19/2/2005 23:37

February 20, 2005

Howard plan to cut pensioners' council tax



THE Tories will announce the first of their proposed tax cuts tomorrow, targeting 5m pensioners who pay council tax, writes Andrew Porter.
Michael Howard, the Tory leader, describes council tax rises as a "stealth tax" which have eroded up to 40% of the increases in the basic state pension announced since Labour came to power.



The proposal for "significant" discounts will be attacked by Gordon Brown, the chancellor, who is expected to claim that council tax rises have been lower than normal this year.

But the Tories say that in the year after the election people will face soaring council bills. They point to a pre-budget report that forecast a continuing rise in council tax receipts to £21.3 billion in 2005-06, equivalent to a rise of 8.1% on the current year.

Howard will say: "Our council tax policy will help millions of older people who are most affected by the council tax rises because they have fixed incomes and are most exposed."

The Tory leader will add that if council tax inflation continues on the same trajectory as it has since 1997, council tax bills would hit £1,836 on Band D properties in the final local government settlement of a Labour third term.

He will add that Tony Blair is planning new council tax banding, which would mean that many homeowners will automatically pay even more. Band D could rise to 133% of the present rate, meaning that bills could hit £2,442 in a third term.

[ariane] 15/1/2005 06:39

Equity release to hit £5bn within two years

VICTORIA THOMSON


THE Actuaries Profession, the industry trade body, yesterday estimated that the growing demand for elderly people to release money from their homes could swell the equity release market to over £5 billion within two years.

The Safe Homes Income Plans organisation, which represents 90 per cent of equity release providers, recently put the market's worth at £1.3bn last year, while the over-60s now have more than £1.03 trillion locked up in bricks and mortar.

But an Actuaries Profession spokesman warned that larger players are set to jump on the bandwagon. "Equity release mortgages came under the regulation of the Financial Services Authority in October and this should attract the big players in the market. If providers like HBOS start getting involved, we could see the market hit the £5bn level by the end of 2007."

The chairman of the Actuary Profession's working party, Ged Hosty, added that the government needs to also regulate home reversion schemes (where owners sell a proportion of their property to a home reversion company and continue to live in it until they die or it is sold) to make high street lenders feel more secure about entering the market. Home reversion schemes represent about 5 per cent of the market, but lenders fear they could be victims of mis-selling claims due to its controversial nature.

However, the schemes don't take into account rising values, so a 30 per cent stake in a £100,000 property will be worth significantly more if the property doubles in value.

Hosty said: "We recommend the government and the FSA require providers to illustrate potential payments beyond life expectancy and ensure providers have sufficient reserves to cover their financial exposures to increased longevity."

[maywillow] 14/1/2005 06:42

Elderly warned on equity release

Remortgaging should be a last resort, say actuaries

Phillip Inman
Friday January 14, 2005
The Guardian

Equity release plans that allow pensioners to unlock the value of their homes are expensive and should only be considered once all other avenues for generating cash have been exhausted, a new report warned yesterday.
Elderly people should also consider their attitude towards inheritance because the cost of repaying the mortgage when they die could equal the value of their home, stripping their estate of possibly its most valuable asset, the Actuarial Profession study said.

The group, until recently known as the Institute of Consulting Actuaries, said it welcomed developments in equity release products, which it now considered reliable after a chequered history. It also said taking out an equity release plan "can make an immediate and significant improvement" to the quality of life for many elderly people.

But it said there could be many other cheaper avenues to raise cash. Ged Hosty, chairman of the equity release working party, which included pensioner charities and Which?, formerly known as the Consumers Association, said older people should first consider selling up and buying a smaller home, a move that always proved much better value than the best equity release scheme.

"Since it is likely to be the last major financial transaction anybody enters into, it is essential that everybody considering such a step makes sure they are fully aware of the financial and other implications before committing themselves," he said.

The £1.2bn market is likely to grow to £5bn over the next couple of years, after the government's decision to regulate all equity release products.

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Ministers initially resisted calls for the regulation of home reversion plans, arguing they involve the sale of some or all of the home rather than the sale of a financial product.

Reversion plans remain a small part of the market and will not be covered by the Financial Services Authority until 2005 or even 2006, while mortgage-based products will be regulated from October 31.

Regulation could be tested, the report says, if the FSA continues to endorse illustrations of the mortgage debt spanning a 25-year cycle. Actuaries calculate that at least one member of a 60-year-old couple will live another 31 years, almost doubling the debt.

Equity release mortgages, which are sold by Prudential, Norwich Union, Standard Life and Northern Rock, among others, charge a fixed interest rate on the debt raised. The debt rolls up each year, which could lead to large repayments on death. Most plans are less than 10 years old and have yet to be wound up.

Mr Hosty, the chief executive of financial adviser Equity Release Services, said 10 years ago customers would commonly have low pension incomes and would opt for equity release products to pay for essential items.

He said: "Our study found that most people these days take out an equity release plan to maintain their lifestyle. That's not to say they spend the money on cruises, though some do. They spend it on essential upgrades to their homes, like stair lifts or raising electrical sockets, or increasing their monthly income."

He said research into the attitudes of people aged 65 to 75 had found that they no longer considered passing assets to their children or grandchildren a top priority.

He said this factor - along with cuts in pension incomes in recent year - was another element pushing people to take out the plans.

Home blown: How plans work

Equity release products allow people to unlock some of the value tied up in their property; mortgage-based products dominate the market. The provider lends the customer cash and takes a mortgage charge on the property. Fixed interest packages, or roll-up mortgages, are most popular.

Typically, a 60-year-old couple will take out a mortgage and release £30,000 of cash. Providers charge about 7.5% interest. The house remains in the hands of the couple. Capital and interest are repaid from its sale on the owner's death. If they live another 25 years, the provider will want £182,950. The acceleration in debt inherent in roll-up plans means they will owe £282,347 if they live a further six years.

Home reversion plans are the main rival and involve a homeowner selling at a discount all or part of their property in return for a lump sum or income. They are then allowed to live there rent-free for the rest of their life. They will release anything from 30% to 100% of the property value.