The first Budget of the new Government is due to be debated in December and, despite the smoke and mirrors on social media, it is clear that Jersey’s pensioners have been forgotten about once again.
In a wealthy society like Jersey, it is not too much to ask that after a life of working hard you should be entitled to enjoy a retirement with security and dignity. This is a right that should be afforded to all of us, and governments must protect and enhance the systems that previous generations put in place to ensure a basic bedrock of support is there for everyone.
After the Second World War, despite mass opposition from conservatives, Philip Le Feuvre introduced a visionary Social Insurance system to ensure Islanders who paid into the system would receive an Old Age Pension when they retired. That system has evolved over time, and many other provisions have been developed on top of this. Naturally, Islanders feel a great sense of protectiveness over it and want to ensure that our politicians safeguard it. Whenever the subject of pensions or pensioner support is raised, it typically provokes much comment from those who care about it.
So when you see the government say “we are helping pensioners with the cost of living and providing greater peace of mind in retirement through a package of support designed to make everyday life more affordable” that sounds like something to get excited about.
And then you read the fine print…
The full Government Budget can be read here, but the government also published a “blog” (if you can call it that) to spotlight the package they say they are putting in place.
It’s sad to say this “package” of which they speak of is non-existent.
It starts by highlighting the increase to the basic Old Age Pension by 4.7%. This now takes it up to £16,294, from the start of this month. Obviously, this is something to welcome. But to claim this as part of a package is disingenuous, because rises in the Pension are guaranteed every year anyway. They’re not optional. There is a formula set out in law, that it must increase by at least the June RPI rate for pensioners, calculated by Statistics Jersey. This was… 4.7%! So they have not taken any initiative to go above the minimum they were required to anyway. This basically means the value of the pension is standing still.
Next is an additional £200 payment in the Community Costs Bonus in April next year. But it must be noted that the vast majority of pensioners will not be entitled to it, and it is not specifically for pensioners anyway. It is for any household that had an Income Tax liability of less than £2,735 last year and is not on Income Support. So for the pensioners who need the help the most, they will not be eligible for this.
Lastly is just a list of schemes that are already well established and are not being adjusted at all. The Pension Plus Scheme which provides cheaper access to some health services (like GP appointments) was significantly expanded under the previous Social Security Minister, Reform Jersey co-Leader Deputy Lyndsay Feltham, but the current minister is not proposing any changes. The list also refers to the pensioners’ Christmas Bonus, which has been frozen, so is technically worth less in real terms this year.
If this is meant to be a package to transform conditions for pensioners, it completely lacks inspiration.
Machiavellian Maclean
But is it any wonder that such a duplicitous claim would be made towards Jersey’s pensioners when the minister responsible for this government Budget is Senator Alan Maclean?
With so much going on in their lives, you can forgive most Islanders for not having long memories in Jersey politics. But those of us who were at the forefront of past battles remember them very clearly, and still have the scars to show from it.
Perhaps the lowest point in Jersey politics over the last decade and a half was the 2016 ‘Medium Term Financial Plan’ (AKA, what we called the ‘Budget’ back in them days). The government, led by Ian Gorst with Alan Maclean as his Treasury Minister, proposed a real package when it comes to Jersey’s pensioners. But it was anything but supportive, it was an outright attack.
Maclean and Co. proposed cutting the Income Support disregard rule when it comes to the Old Age Pension, which simply took money from the lowest income pensioners. They proposed abolishing the pensioners Christmas Bonus and free TV licences for over 75s. To top it off, they also proposed abolishing the £3,000 enhanced tax allowance for pensioners, which ensured that all pensioners bar the most well off were protected from paying Income Tax upon retirement.
This was a dark time. A rather nasty and ideologically motivated austerity agenda that served purely to hurt the least well off, all in the name of making “savings” and “balancing the books”, all of which failed anyway.
But thankfully there was a bit of a fightback.
In a protest organised by Reform Jersey, pensioners flocked to the Royal Square on the morning of 15th December 2015, to encourage States Members to vote against measures that would hurt them and to vote in favour of the amendments that had been brought to try to prevent these cuts.
Thankfully, the progressives in the States Assembly managed to secure the retention of the Christmas Bonus, but on a means-tested basis, and the abolition of free TV licences for over 75s was defeated too. But the majority of members voted to consciously push low income pensioners into poverty by reducing the Income Support disregard on the States Pension and to abolish the enhanced pensioners tax allowance.
What followed was utterly predictable. The rise of pensioner poverty in Jersey.
The latest published Jersey figures cover 2021/22. They show that 28% of pensioners were living in relative poverty after housing costs, compared with the UK figure of 18% cited in the same report.
So, despite being a much more affluent and tightknit society than the mainland, Jersey has allowed its pensioners to suffer the indignity of poverty at a completely unacceptable level.
This is all bad enough. But to add insult to injury, our politicians continue to dupe those who feel the brunt of their decisions.
In May this year, when Alan Maclean sought to make his comeback to Jersey politics, he made a promise that is galling given his history. He proposed to introduce a “new higher Pensioner-only threshold to protect fixed-income senior citizens“. Errrr… you mean just like the one you abolished a decade ago, Senator?
But, being fair, if politicians make mistakes, learn from them and commit to change, then we should welcome that conversion. But is this such an occasion? No.
Despite the promise being crystal clear in his manifesto, now that he holds the reins as Treasury Minister and has the power to implement it, the Budget contains no proposal to re-introduce this new tax allowance!
Promise made. Promise broken.
Pensioners Deserve Better
Pensioners should not have to wade through the small print to work out whether a promise of help actually means anything new. Nor should they have to remind the Treasury Minister of the promises he made only a few months ago.
An annual pension increase, a one-off payment that some will never receive, and a list of schemes that already exist. Is that really the best this wealthy Island can offer?
Of course, it isn’t. But you won’t get anything more with independent conservatives in charge who repeatedly just say one thing to get elected and then nakedly serve vested interests once they are in.
Only a genuine political movement that brings together those who want to serve the interests of all of the constituent groups that make up Jersey’s working class will bring about the change that Jersey needs.
– Authored by Sam Mézec