Spending Review Submission

About Later Life Ambitions

Later Life Ambitions (LLA) is a coalition that brings together the collective voices of over a quarter of a million pensioners from all four nations of the United Kingdom.

LLA consists of three member organisations: the Civil Service Pensioners’ Alliance (CSPA), the National Association of Retired Police Officers (NARPO) and the National Federation of Occupational Pensioners (NFOP).

As a campaigning group, LLA has ambitious aspirations for the next generation of pensioners. From fair pensions to safe and sustainable care services, and from accessible housing to regular bus services to promote independence, LLA calls for bold and forward-looking action from political leaders and other decisionmakers.

In the UK today, there are 12.95 million people in receipt of the State Pension; and the ONS forecast that this number will increase to 13.7 million by 2032, taking into account the increase in the State Pension Age to 67. Each one of these people will have their own hopes, aspirations and needs. The issues pensioners face today will also impact on future generations of pensioners unless today’s policymakers are willing to confront the challenges now.

In November 2023, Later Life Ambitions was proud to launch Standing by Pensioners: A Manifesto for Later Life in Parliament under the kind sponsorship of Sir Stephen Timms MP, the then-Chair of the House of Commons Work and Pensions Select Committee. The event was very well-attended with the participation of parliamentarians from all parties then represented in Parliament and garnered notable press coverage in the Sunday papers.  Standing by Pensioners set out our vision for a better deal for older people through six key asks we believe have cross-party appeal. We continue to call for:

1. The UK Government to create an Older People and Ageing Commissioner for England and Scotland, following the examples set by Northern Ireland and Wales.

2. A National Social Care Service integrated with the National Health Service that remains free at the point of delivery.

3. The UK Government and the devolved administrations to combat digital technology’s role in social exclusion and access to vital services.

4. All political parties to commit to guarantee the State Pension triple lock for at least the duration of the current Parliament.

5. All new homes to meet the Lifetime Homes standard with a national strategy for more adaptable, accessible homes across all tenures.

6. Investment in local bus and rail services for uprated concessions and for improved accessibility and assistance for older people on all new bus and railway stock and facilities.

The economic imperative

Elderly people represent a significant and often undervalued component of the UK economy. The perception that the UK’s aging population is primarily a burden overlooks the vital contributions that those in later life make across various sectors. This submission outlines the economic value of elderly people, emphasising their participation in the workforce, consumption patterns and the provision of unpaid care, among other key contributions, and sets out areas of fiscal policy which are crucial to delivering a better deal for older people.

1.     Workforce participation

Many elderly individuals continue to work beyond retirement age, contributing to economic productivity:

• Growing workforce participation: The number of people aged over 65 in employment has risen significantly. In 2023, around 1.4 million people aged 65+ were still working.
  

• Filling labour shortages: Older workers provide skills and experience in sectors facing shortages, such as healthcare, education and retail.
  

• Entrepreneurship: A growing number of older people are becoming self-employed or starting businesses. People aged 50+ are responsible for one-third of all UK start-ups, boosting job creation and represent a wealth of knowledge and experience for younger generations. As of the second quarter of 2024, approximately 34.4% of self-employed people in the UK were aged 65 and older. This is a significant increase from previous years, with the number of self-employed people in this age group more than doubling in the last five years.  
  

2.     Consumer spending and economic activity

Elderly people are a powerful consumer group, but the fiscal choices made by the Government at the Autumn Budget have damaged consumer confidence as pensioners’ pessimism around the Government’s economic strategy remains unchanged. The Government’s Spending Review presents an opportunity to signal the importance of those in later life to economic growth and society at large.

• Spending on goods and services: Older adults spend billions on travel, leisure, healthcare, housing, and retail.
  

• Boosting industries: The elderly play a key role in sustaining businesses, particularly in sectors such as:
  

o   Tourism through frequent travel, which benefits airlines and the hospitality sector.

o   Healthcare & wellness – spending on medical care, fitness, and wellbeing industries continues to rise.

o   Housing market – many purchase retirement homes, freeing up housing stock, or invest in renovations, supporting the the construction industry.

3.     Volunteering and social contribution

Elderly people contribute billions of pounds in unpaid labour through volunteering and caregiving:

• Volunteering: a large proportion of charity and community work is supported by older people. Their unpaid contributions help sustain vital services.

• Childcare support: many grandparents provide free childcare, allowing parents to work. This indirectly supports the economy by reducing the need for paid childcare and enabling parents to stay in employment.

• Caring for other elderly people: older individuals care for spouses, friends or other elderly relatives, reducing the strain on NHS and social care services.

Our core asks:

Pensions and Financial Security

A secure retirement should be a right, not a privilege. Too many older people in the UK face poverty and financial disadvantage which prevents them from making the most of later life. As of May 2024 (prior to the withdrawal of the Winter Fuel Payment for millions of pensioners), 1.9 million or 16% of pensioners lived in relative poverty. Age UK estimated that the Government's decision to means-test the Winter Fuel Payment and link it to receipt of Pension Credit affected 2 million pensioners who had budgeted for, but subsequently, did not receive the benefit.

We welcomed Labour’s qualified support for the future of the Triple Lock in the election campaign; however, we would like to see a long-term commitment to the Triple Lock at the next fiscal event. It’s important to remember that the state pension is not a benefit but a contributory scheme paid in over peoples working lives. Older people should not be worried about more money being clawed back in tax through the fiscal drag of frozen thresholds or other fiscal interventions.

We are calling for the Government to:

• Guarantee the State Pension triple lock, securing annual increases linked to inflation, earnings growth, or 2.5%.

• Update outdated benefits like the £10 Christmas bonus and over-80s allowance to reflect current costs.

• Link pension age adjustments to healthy life expectancy to ensure fairness for diverse health outcomes.

Winter Fuel Payment

LLA was deeply concerned by the Government putting an end to universal eligibility of the Winter Fuel Payment for pensioners. The decision to exclude retirees not receiving Pension Credit and/or other means tested benefits from receiving the Winter Fuel Payment will endanger many pensioners every winter.

The Department for Work and Pensions estimates that up to 850,000 pensioners nationwide fail to claim Pension Credit. There are many reasons for this: some simply do not know about Pension Credit or do not think they are entitled to it; others have been left behind by an increasingly digital-first world. Others still choose not to claim Pension Credit out of generational pride.

Those in later life are more susceptible to the cold, and it is known that warm homes are beneficial to health. Ensuring that older people are housed in warm homes thus helps ease the burden the NHS faces each winter. Keeping pensioners warm is therefore not only a humane thing to do, but one that benefits the whole of society.

With an ageing population living in deteriorating – and often poorly insulated – housing stock, the Government’s position once again highlights the need for better quality homes, not just for older people but for all in society. A key ask in the LLA Pensioners’ Manifesto is that local authorities are given greater powers to compel developers to meet minimum standards, which meet local needs.

Many age-related benefits have traditionally been available to all pensioners, such as free prescriptions, concessionary bus passes and free TV licences. All play a vital role in reducing pensioner poverty and ensuring that older people can play an active part in a society they have spent a lifetime contributing to. Notably, some universal benefits, including the Winter Fuel Payment, were introduced because the State Pension did not provide adequate income to keep pensioners from poverty.

Digital exclusion and access to cash

The race to digitalise society threatens to leave older people behind, with particular respect to banking and financial services. ATM closures have accelerated with the increased digitalisation of banking, with 13,679 ATMs closing between 2018 and 2022. In the South East, there are just 6.7 ATMs per 10,000 residents. Vulnerable older people, particularly those on lower incomes, are likely to be most significantly affected by any reductions in access to cash, with just over a quarter of older people not using card payments at all.

The closure of bank branches negatively impacts older people as banks are easier to access than an online platform and staff at bank branches may be more likely to identify fraud or financial abuse, especially if an older person is exhibiting cognitive impairment. Despite this, thousands of communities have already been left without a bank on their high street. Indeed, there are few organisations fighting for banks in high streets and in rural communities.

We are calling for:

• Banks and other businesses to have comprehensive vulnerable client policies and procedures in place, to ensure these customers can access the services that they require.

• The Lending Standards Board and Financial Conduct Authority to be given greater powers to prevent banks closing branches.

• The establishment of a sector wide code for consumer protection and accessibility, stipulating minimum standards that individual businesses and firms should adhere to.

• A proliferation of accessible banking platforms and banking hubs to serve hard-to-reach communities.
  

Health and Social Care

Millions of older people don’t know how they will be cared for in old age. An Ipsos Mori report found that the majority of the British public were unaware that individuals are often responsible for paying for all or most of their own care.

People who do not qualify for publicly funded social care must pay all of their care costs themselves. This has led to 143,000 older people facing ‘catastrophic lifetime costs’ of £100,000 or more. This is not sustainable or fair, so we are calling for Government to increase spending on adult social care in proportion to total public expenditure. We’re calling for a minimum 10-year government spending commitment towards social care with a pledge to increase real-terms spending significantly across this period.

Later Life Ambitions’ pensioners’ manifesto called for a National Social Care Framework, integrated with the NHS, to ensure consistency in the provision of social care across the country that remains free at the point of access.

Whilst LLA remains committed to these demands, and cognisant that many Local Authorities and Disability Rights campaign groups had expressed deep reservations around the workability and unintended impacts of Dilnot’s proposed lifetime cap on the cost of care for individuals, we are nonetheless concerned at the Chancellor’s announcement on the 29 July that the Government have scrapped the planned implementation of the introduction of the cap on care fees from October 2025.

Since then, there have been announcements about the independent review to be conducted by Baroness Casey, however the final report is not due until 2028 and, with the prospect of an election in 2029 the chances of cross-party consensus are low. We have been told to expect the Casey Review to make interim recommendations in 2026, outlining medium-term improvements to be made, before any new national provisions are implemented. This has led to fears that this is yet another case of ‘kicking the can down the road’ when urgent action is called for to address an escalating crisis, exacerbated by spiralling costs and staffing shortages, coupled with a legacy of chronic Local Authority under-funding. The new Fair Wages deal is unlikely to improve recruitment in the care sector until it takes effect in 4 years’ time, so progress in this area is unlikely to be realised for some time.

The increases in Employer National Insurance contributions, announced by the Chancellor last summer, will have an enormous impact on social care providers up and down the country, affecting charities and private sector organisations alike, who are not eligible for public sector compensation payments. The organisations we work with have warned that service users, and those commissioning care services, will start to see the effects of this from April 2025, and some providers may even have to withdraw from Local Authority contracts or cease their operations entirely.

LLA calls for:

• Decent quality, sustainably funded, free at the point of delivery social care service operating in cooperation with the NHS.

• The Government to legislate without delay to establish this National Social Care Service, to be integrated with the NHS that remains free at the point of delivery. The service was committed to by the Labour Party in its manifesto.

• A minimum 10-year government spending commitment towards social care at the next Budget with a pledge to increase real-terms spending significantly across this period.

• A comprehensive plan brought forward urgently to address the chronic workforce issues in the social care sector.

• An Independent Commissioner for Older People and Ageing as part of an overall strategy to tackle the challenges faced by older people now and in the future, and to offer those who need it, advocacy, and legal support.
  

Conclusion

LLA wants to see a comprehensive and equitable plan for elderly people in the UK. Being able to fulfil one’s ambitions for later life starts with stability and the ability to access vital services, play an active part in society and meet financial obligations after a lifetime of economic and societal contribution.

The cost of providing an increasingly ageing population with the financial, health and welfare support that they need to stay active, fit and well must be balanced against the social and economic contributions those over 65 have made throughout their lifetimes and continue to make in later life through ongoing employment, voluntary work, unpaid caring, and other forms of societal engagement. With the right support and facilities in place, older people can not only continue to contribute for longer but are also likely to lead healthier and happier lives, reducing demand on health and care services in the long run.