Monday, 19 August 2019

A strange form of 'social justice'

Iain Duncan Smith and Social Justice aren’t words which naturally trip off the tongue in a single sentence (unless there’s also a negative to be found somewhere) so calling a think tank founded by him the ‘Centre for Social Justice’ has always looked like an attempt to give a warm-sounding name to an organisation likely to be aiming to do the precise opposite of what it says on the tin.  The latest report from this so-called ‘think tank’ is a case in point, recommending as it does that the state pension age be gradually increased to 75 by 2035.
It is hard to see what, exactly, that policy has to do with ‘social justice’, given that its greatest impact will be on the lowest-paid (i.e. those most dependent on the state pension in later life), whilst the higher-paid will continue to be in a position to retire a great deal earlier if they wish, since they generally have other, more generous, pension provision.  And whilst generalisation is not without its dangers, we know from other data that lower income is associated with poorer health and shorter life span, meaning that the number of years for which the pension is received by people in this group is significantly less in any event.  It’s an odd kind of ‘social justice’ indeed which suggests that the least well-off should have to work the longest, receive the lowest pensions, and enjoy them for the shortest time.  Clearly it isn’t the pensioners concerned who benefit from such a policy – the beneficiaries are the higher earners who are unaffected directly by the proposal, but who will be looking to gain from any tax reductions (or by avoiding what might otherwise be required tax increases) as a result of reducing the cost of providing pensions.
The report does actually recognise that issue, stating: “Low income households, therefore, have the greatest need to remain in work, but also face the highest barriers to working” (because, for instance, they “… have less opportunity to amass sufficient financial resources”).  Anyone serious about ‘social justice’ would be looking at why they have ‘the greatest need to remain in work’, instead of which they decided to concentrate on overcoming the barriers to them doing so.
It’s clear that the underlying basis for the proposal has little to do with social justice and everything to do with a particular ideological perspective, which for me is summed up in this sentence from the report’s summary, which reads: “Ensuring that this growing proportion of older people continue to make an essential contribution to our economy as workers, carers, taxpayers and volunteers is an important question for public policy”.  Had it been worded just a little differently, talking about how those older people who wanted to go on making a contribution in any of those ways could be enabled to do so, I wouldn’t raise any issue.  Not everybody wants to ‘retire’ and facilitating continued activity is an entirely valid objective of public policy.  (Although I don’t see how they get from a contribution as ‘carers’ or ‘volunteers’ to the conclusion that they don’t need a pension; it’s a strange juxtaposition.)  But the ideological underpinning here is the idea that people’s whole purpose in life is – or should be – to contribute as workers (either paid or voluntary) and taxpayers, and that the government should ‘ensure’ that they do so.  That is an attack on the whole concept of ‘retirement’ as it has been previously understood.  From this perspective, ‘retirement’, or rather the payment of the state pension, becomes increasingly limited to those who are physically unable to work any longer, and the objective is to pay it for as short a time as possible.
None of that is to deny that better health and an increasingly aging population don’t cause challenges for a pensions system which has always been run like a giant Ponzi scheme because the ability to pay pensions out of current revenue effectively assumes continuing population growth.  But that problem wasn’t caused by those who are about to find their working life extended significantly – it was caused by the politicians who designed and have presided over the scheme from the outset, and who have given themselves a different and better pension scheme meaning that they are unaffected by proposals such as this one.  There is a long-term challenge involved in putting the state pension onto a sound basis; deferring pension rights for the lowest-paid is avoiding the issue, not solving it.

1 comment:

dafis said...

Better late than never ! I agree totally with your review of this latest pensions "scam" albeit in a draft form. Trying to duck liability to the rank and file while feathering nests of the most well off is a highly anti democratic stunt. I was about to say "anti egalitarian" but that was never the case anyway, although an equality of principles did just about exist until some time in the late 80's early 90's when executive rewards became an obsession among corporate types and government ministers and mediocre politicians followed suit because they too felt "entitled".

Bad bastards all round I say. This the sort of behaviour that stimulates a justifiable populist response but there again there's plenty of so called lefties out there who get all anxious when that word is uttered. If UK or indeed Wales could produce talent like we produce troughers all our problems would be solved. Until then the disadvantaged and the less advantaged have a bleak future as far as retirements and incomes therein are concerned.