George Osborne challenged: Come and see what the granny tax will do to Northern Ireland
Under-fire Chancellor George Osborne is being challenged to come to Northern Ireland to witness the plight of hard-pressed pensioners and explain why he is taking money off the elderly.
As grey fury grows over the ‘granny tax’ in the Budget, it emerged Mr Osborne will be called to account at a two-day Pensioners Parliament here in May.
Should he agree to show, he will be quizzed by 180 older people — just a representative fraction of the tens of thousands of pensioners in Northern Ireland who will be an average of £84 a year worse off.
The come and explain yourself demand was issued by the pressure group Age Sector Platform (ASP), which also revealed the results of a survey of 1,000 pensioners in Northern Ireland.
Almost two-thirds of pensioners questioned here said they did not have enough money — and ASP said the new tax plans will only exacerbate their hardship.
The group insists the coalition Conservative/Liberal Democrat Government is “totally out of touch” with the problems facing the average pensioner.
Pensioners are cynical about the Government’s “we’re all in this together” mantra after it was revealed that several wealthy Cabinet members, Mr Osborne among them, will benefit from the new tax regime.
Chairwoman Patricia Donald said: “This stealth tax will mean between four million and five million pensioners across the UK will be worse off in the coming years, losing an average of £84 a year.
“The Government’s assertion that no pensioner will be worse off fails to consider the impact of inflation on the pockets of older people, who in fact often face higher rates of inflation than other age groups.
“In response to this announcement, Age Sector Platform intends to invite the Chancellor to the two-day Northern Ireland Pensioners Parliament in May 2012 to justify the Government’s policy towards pensioners.
“We know that this announcement will be a hot topic for discussion and the pensioners in attendance will be eager to receive an explanation from the Chancellor for this decision.
“In fact, our survey of around 1,000 pensioners in Northern Ireland has found that two out of three older people (64%) say they currently don’t have enough money.
“The so-called ‘granny tax’ announced by the Chancellor will mean this situation will only become worse in the coming years,” she said.
Mr Osborne, however, defended his decision to freeze the personal allowance for pensioners from next year and argued he is attempting to simplify the system. Campaigners for the elderly said the move is designed to raise £3.25bn over the next four years and pay for the £1bn lost from cutting the 50p top rate of tax to 45p.
Denying he had singled out pensioners in the Budget, Mr Osborne told BBC Radio Four: “We were rapidly increasing the tax allowances and they were going to overtake the age-related allowances, so it allowed me to subsume them into one and simplify the system.”
Margaret Galloway, a former Inland Revenue official who supports Age Sector Platform, said: “For simplification read ‘save money’.
“Pensioners understand more than most people what it is to be all in this together. But David Cameron is not in this with anybody. If we are losing, somebody else is gaining.”
Ms Galloway, who was part of a local delegation which met Pensions Minister Steve Webb last year, said the well-off were able to move their money about and not pay tax.
Bob Stronge, chief executive of Advice NI, said: “In the current economic crisis many lower income families in Northern Ireland are struggling to pay bills and make ends meet. Over the last year there have been unprecedented increases in electricity, heating oil, gas and average grocery bills.
“Coupled with welfare reform measures such as the harsher Employment and Support Allowance regime to which Incapacity Benefit recipients will shortly be subjected, the poorest and the sick and disabled are most certainly in the firing line in terms of bearing the brunt of austerity measures.”
The Chancellor has insisted no pensioner will lose cash as a result of his changes, which will see their allowance frozen at £10,500 for over-65s and £10,660 for over-75s and abolished altogether for those turning 65 after next April. The Institute of Fiscal Studies said it was a “relatively modest tax increase (of 0.25%) on a group hitherto well-sheltered from tax and benefit changes”. But it said those reaching 65 in the next few years would be hardest-hit and the Chancellor should have given them more notice to allow them to plan for it.
What they said...
Ivan Baxter (72) - Retired civil servant from east Belfast. He says:
‘This is the third time pensioners have been mugged ... this is Robin Hood in reverse‘
The first thing I thought when I listened to the Budget was it is Robin Hood in reverse.
“The Government are robbing the poor to pay the rich. I am a realist with money and pensioners are way down the pecking order, we’re losing out.
At 72 years old I will lose out on the additional allowance when I turn 75 years old. This is the third time pensioners have been mugged, the winter fuel payment was reduced and the change in indexation with changes from retail to consumer prices. We are being attacked as pensioners.
I worked 38 years as a civil servant and therefore I have a work pension and a state pension. So I am a taxpayer and I will be hit by these changes.
I have a camper van, I go on holiday in it. I have to think twice about using it now because of the cost of fuel. It affects your way of thinking.
I can use public transport because I am in Belfast but other pensioners in the west of the province are not so lucky.
With closures of post offices they have to use their cars to travel to other towns and with three pence going on the price of fuel, it hits them. I was quite annoyed when David Cameron said pensioners are getting the biggest increase in a long time.
I am a home owner and a widower, it makes you think.
Terri Hooley (63) - Founder of Good Vibrations record shop and ‘Godfather of Punk’. He says:
‘Politicians need to go out and see the hardships elderly face’
It’s an absolute disgrace they are picking on old people like myself.
I saw the headlines about the granny tax and even the Tory Press was giving Osborne a hard time.
Tories are always going to look after their friends and the rich and they will hit the poor and pensioners whatever way they can.
Pensioners do go out and vote, so I am a bit surprised they have hit them in this way.
Politicians need to get out into the world to see the hardship older people are going through.
They survived the war, worked hard all their lives and now they are being shafted.
Next they will be taxing the dead.
Margaret Galloway (68) - Retired revenue officer and campaigner for pension rights from Belfast. She says:
‘It’s a cabinet of millionaires legislating for the rest of us’
I’m horrfied by it. We had expected for some time that they were going to do this. I receive a civil service pension — I get about £650 net of tax and the state pension is about £105. The change works out about £83 a year less and that’s about £7 a month.
The cost of living will hit everyone. My husband is in a wheelchair and we would have heating on a lot more than others and of course the cost of that is astronomical.
I do think we are being asked to pay for the reduction in the 50p tax to 45p for the super-rich. I would be saying to George Osborne — how can you justify this morally? It’s a cabinet of millionaires legislating for the rest of us.