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Centre for Policy on Ageing | |
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Tightropes and tripwires
— New Labour's proposals and means-testing in old age | | Author(s) | Katherine Rake, Jane Falkingham, Martin Evans |
| Corporate Author | ESRC Centre for Analysis of Social Exclusion - CASE, Suntory-Toyota International Centres for Economics and Related Disciplines - STICERD, London School of Economics and Political Science |
| Publisher | STICERD, London, 1999 |
| Pages | 25 pp (CASEpaper 23) |
| Source | Centre for Analysis of Social Exclusion, London School of Economics, Houghton Street, London WC2A 2AE. |
| Keywords | Pensions ; Income [older people] ; Means testing ; Poverty ; Social policy ; Comments or Evidence submitted. |
| Annotation | The proposals in "A new contract for welfare: partnership in pension" (Cm 4179) are analysed, focusing on provisions for low paid workers and the potential of the new rules to guarantee a decent income in old age. The authors identify a number of design faults that could extend means-testing to many low paid workers. The paper models lifetime incomes for a range of hypothetical, low-income individuals and their partners on the Green Paper's proposals. It finds that the proposals add up to reinventing a new two-stage basic pension, with two features missing: an "adequate" level of payment and comprehensive entitlement. The authors argue that the proposals incorporate tightropes and tripwires. The tightrope is basic and secondary pensions so near to the means-tested minimum, that little is gained from a lifetime of work and contributions. Tripwires exist because common life events (e.g. periods of sickness, unemployment, and caring responsibilities) which disrupt basic and secondary pension entitlement are not covered by the proposals. The paper doubts the proposals' sustainability, the robustness of assumptions on which these are based, and the sensitivity of the low paid to fluctuations in the annuity market. (RH). |
| Accession Number | CPA-990504201 B |
| Classmark | JJ: JF: JF4C: W6: TM2: 6PM |
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| ...from the Ageinfo database published by Centre for Policy on Ageing. |
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