Saga is calling on the Chancellor to give focussed attention on older people and the power of their ‘grey pound’ in this week’s Budget with a view to supporting economic growth and stimulating jobs UK-wide.
Launching Saga’s 5-point plan for jobs and saving, Dr Ros Altmann, economist, former Government adviser and Saga’s Director-General, said:
“This year’s Budget should be more than just political manoeuvring around the 50p tax rate. Saga is calling for real momentum around getting the economy back on track in a way that is visible to families the length and breadth of Britain. Older people buy, save, spend and vote in their millions and for that reason we are calling on the Chancellor to make meaningful changes that not only support the livelihood of older generations but gives them the confidence to make a difference to growth.
“Now is also a critical time to get the nation thinking about their older age and Saga is calling for a number of measures to be launched this week to help people plan for a better future.”
Saga’s 5-point plan for jobs and saving
1. Reconsideration of QE: Creating funds for underwriting direct lending to SMEs and helping pension funds commit money to major infrastructure projects would be a far better policy than buying gilts, especially at current yield levels. Lending directly to small businesses, or guaranteeing a minimum return for investors willing to do so would support jobs, and growth, and abandoning the dangerous gilt-buying programme would put an end to the constant erosion of annuity rates and dangerous explosion of pension deficits
2. Housing policy reform: A new housing planning framework that will give more flexibility to local authorities to permit the development of aspirational smaller homes in communities for older people without onerous requirements or restrictions plus Stamp Duty incentives to encourage older home owners to downsize if they want to, perhaps including a Stamp Duty holiday for older people
3. Increased flexibility in ISAs: Allowing people to make their own choices about the balance of cash versus shares and supporting older people who can’t afford to gamble on the stock market by permitting the full annual ISA allowance in cash or shares, whichever is best for the individual
4. Supporting saving for care: A new Care Savings Allowance for the over 50s, allowing tax free savings towards care up to a £50,000 limit for themselves or their relatives
5. Pensions reform – including issuing longevity gilts and more flexibility for pensions: Flexible Auto Enrolment which supports saving into workplace ISAs or pensions, plus issuing of Longevity Bonds (rather than the idea of issuing 100-Year Gilts) would be a much more attractive proposition for pension and annuity providers, linking interest to life expectancy and helping mitigate some of their risks.