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Telegraph
5 days ago
- Business
- Telegraph
The gold-plated pensions costing taxpayers £400m a year
Taxpayers are spending more than £400m a year on gold-plated pensions for just 10,600 judges, new analysis shows. The average member of the Judicial Pension Scheme now receives £37,000 in pension contributions for each year of work, before being handed almost £40,000 a year in retirement. They have built up £4.5bn in taxpayer-funded pension entitlements, but pay up to 7pc towards the cost of their retirements. The figures come despite major reforms to public sector pensions in 2015 after rising costs pushed the Government to act. The Taxpayers' Alliance said judges should be moved into defined contribution schemes, while the Intergenerational Foundation said the 'profligate pension promises' would be funded by young people. There were 10,578 members of the Judicial Pension Scheme at the end of 2023-24, according to a Freedom of Information request made by The Telegraph. Judicial salaries ranged from £106,563 to £312,510 during the year, according to the Ministry of Justice. As public sector workers, they are entitled to guaranteed, inflation-linked pensions for life. The scheme's 6,162 working judges paid in 4.1pc of their salary on average. As their employer, the Ministry of Justice then added another 51.1pc at a cost of £229m. The required employer contribution increased to 62.6pc from April last year to keep pace with the rising costs of the scheme, but the amount paid in by employees has remained the same. Before 2012, judges did not have to contribute to their personal pensions and only paid towards benefits for their dependants. The scheme's pension payouts are also more generous than other key public sector schemes, with retirees receiving £39,400 on average – costing taxpayers another £180m a year, taking the total bill to £409m. By comparison, the average pension was around £16,600 for teachers and £12,300 for Armed Forces personnel, falling to £11,400 for NHS workers and £9,900 for retired civil servants. Liz Emerson, of the Intergenerational Foundation, said: 'Younger generations can only dream of similar pensions, but they will end up paying for these profligate promises via higher taxation, later retirements and lower pensions themselves. 'At the very least, the Government should levy National Insurance contributions on annual pensions that are higher than the average earnings of working-age adults.' Public sector pensions already cost the UK £54.3bn a year, despite being moved away from final salary schemes in 2015 amid fears they had become unaffordable. Payments are now based on a worker's average earnings, but the final salary entitlement for existing members was extended to 2022 after a legal challenge from members of the judicial and firefighters' pension schemes. Under the new system, judges have 2.5pc of their salary added to their pension each year, which is more than teachers, civil servants, NHS workers and Armed Forces personnel. John O'Connell, of the TaxPayers' Alliance, said: ' Public sector pensions are extraordinarily generous with employer contributions, often outstripping those in the private sector. 'But what makes them particularly generous is the fact that they are gold-plated schemes, not based on the value of a pension pot, but on the average earnings of the employee, meaning they get topped up above and beyond what has already been contributed. 'On top of this, they are unfunded, coming not from an investment scheme, but general taxation. At the very least, ministers should be moving all public sector workers onto fully-funded, defined contribution schemes which are based on monies actually paid in.' A report published last year by the University College London Judicial Institute revealed that more than one in three judges planned to quit the profession within five years, citing poor working conditions and a continual loss of net earnings amid a backlog in the country's courts. The Senior Salaries Review body recommended a 4.75pc pay rise for members of the judiciary for 2025-26, but the Lord Chancellor reduced it to 4pc. A Ministry of Justice spokesman said: 'The Judicial Pension Scheme 2022 is designed to encourage top legal professionals to become judges who are vital to keeping the justice system running.'
Yahoo
10-06-2025
- Business
- Yahoo
Government accused of prioritising pensioners over children
A gulf between government spending on pensioners and children has widened by 170pc in the past two decades, new research suggests. Last year, public spending per pensioner was £12,600 higher than it was per child, according to a report by think tank the Intergenerational Foundation. It reveals spending on pensioners has increased by more than half in the past two decades, while the amount of taxpayer cash devoted to children has lagged. Between 2004 and 2024, spending on retirees went up by 55pc in real terms, while children saw an increase of just 20pc during the same period, the report said. Analysis showed taxpayers spent £31,000 per pensioner last year compared with £18,000 per child, while working-age adults cost £14,000. It comes after Rachel Reeves reversed her decision to strip most pensioners of the £200 winter fuel payment following a months-long public outcry. Liz Emerson, chief executive of the International Foundation, said government policy is overly favourable to pensioners because they are a key voting constituency. She said: 'Welcome, though rapid, ageing has expanded the welfare state for the old while support has been largely withdrawn from the young. Add the power of the grey vote, and it is all too tempting for governments to respond to older generations' wants, irrespective of their actual need.' She added this increasingly contrasted with societal difficulties faced by younger people. 'Younger generations face a polycrisis of low government investment, high housing costs, low welfare support, and high taxation. 'The fact that birth rates are falling may well indicate that younger generations do not believe they can provide the economic stability needed to bring up a family.' The research divided government spending on public services like the NHS, state pension, education and social care by the number of children, working-age adults and pensioners in the country. Britain's birthrate recently fell to a record low. The official fertility rate for England and Wales is 1.44 births per woman, significantly less than the 2.1 required to maintain population size. Figures published at the end of last year showed that the number of children born to British mothers had fallen by a quarter in 15 years. It suggests many more women are putting off having children, amid rising cost of living. The increase in state spending on pensioners has been partly driven by the pensions triple lock, which links state pension payments to inflation, wage growth or 2.5pc depending on whatever is highest. Between 2011 and 2025, the state pension for those who reached retirement age before 2016 rose from £102.15 to £169.50 per week, a 66pc increase. Those who hit retirement age after 2016 saw weekly payments go up from £155.65 to £221.20. The report concluded that the triple lock was not 'intergenerationally fair' amid a growing ageing population, referencing Office for Budget Responsibility (OBR) projections that government spending on the state pension will increase from around 4.9pc of GDP last year to 7.9pc by 2074. It added that pension poverty had declined significantly in recent decades, from 28pc in 1995 to 16pc in 2023. Meanwhile, child poverty has remained consistently high with only a marginal decrease from 32pc to 30pc during the same period. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
10-06-2025
- Business
- Telegraph
Government accused of prioritising pensioners over children
A gulf between Government spending on pensioners and children has widened by 170pc in the past two decades, new research suggests. Last year public spending per pensioner was £12,600 higher than it was per child, according to a report by think tank the Intergenerational Foundation. It reveals spending on pensioners has increased by more than half in the past two decades, while the amount of taxpayer cash devoted to children has lagged. Between 2004 and 2024 spending on retirees went up by 55pc in real terms, while children saw an increase of just 20pc during the same period, the report said. Analysis showed taxpayers spent £31,000 per pensioner last year compared with £18,000 per child, while working-age adults cost £14,000. It comes after Rachel Reeves reversed her decision to strip most pensioners of the £200 winter fuel payment following a months-long public outcry. Liz Emerson, chief executive of the International Foundation, said government policy is overly favourable to pensioners because they are a key voting constituency. 'Welcome, though rapid, ageing has expanded the welfare state for the old while support has been largely withdrawn from the young. Add the power of the grey vote, and it is all too tempting for governments to respond to older generations' wants, irrespective of their actual need.' She said this increasingly contrasted with societal difficulties faced by younger people. 'Younger generations face a polycrisis of low government investment, high housing costs, low welfare support, and high taxation.' 'The fact that birth rates are falling may well indicate that younger generations do not believe they can provide the economic stability needed to bring up a family,' Ms Emerson added. Triple lock 'unfair' on younger people- The research divided government spending on public services like the NHS, state pension, education and social care by the number of children, working-age adults and pensioners in the country. Britain's birthrate recently fell to a record low. The official fertility rate for England and Wales is 1.44 births per woman, significantly less than the 2.1 required to maintain population size. Figures published at the end of last year showed that the number of children born to British mothers had fallen by a quarter in 15 years. It suggests many more women are putting off having children, amid rising cost of living. The increase in state spending on pensioners has been partly driven by the pensions triple lock, which links state pension payments to inflation, wage growth or 2.5pc depending on whatever is highest. Between 2011 and 2025, the state pension for those who reached retirement age before 2016 rose from £102.15 to £169.50 per week, a 66pc increase. Those who hit retirement age after 2016 saw weekly payments go up from £155.65 to £221.20. The report concluded that the triple lock was not 'intergenerationally fair' amid a growing ageing population, referencing Office for Budget Responsibility (OBR) projections that government spending on the state pension will increase from around 4.9pc of GDP last year to 7.9pc by 2074. It added that pension poverty had declined significantly in recent decades, from 28pc in 1995 to 16pc in 2023. Meanwhile, child poverty has remained consistently high with only a marginal decrease from 32pc to 30pc during the same period.
The Independent
15-02-2025
- General
- The Independent
Why having a spare room is the next battle in the wars between generations
More in common. That's often the phrase that gets trotted out amid the various culture wars, whipped up into a frenzy to divide and distract us from what's really important. From drag queen storytime to whether the National Trust uses marg or butter in its scones, the number of non-issues ripe for inexplicable weaponisation never fails to amaze. The topics that pit generation against generation can be even sillier – does the length of your socks really signify anything? Does whether or not you send Christmas cards to everyone you've ever met, still have a landline, or choose to upload your musings to Facebook or TikTok really define who you are as a person? But there are some genuine lines in the sand that are hard to ignore, the latest one being space. It's in short supply – and some demographics are more equal than others when it comes to staking their claim. According to new data, b aby boomer homeowners are enjoying ever more breathing space with bedrooms to spare, while Gen Z are being squeezed into increasingly small and expensive rental properties. The latest English Housing Survey reveals that 55.7 per cent of owner-occupied homes in England, equating to just under 10 million, are classified as 'under-occupied', with at least two unused bedrooms. This number has risen by more than 10 per cent over the last 20 years. But the story of the rental market is very different – just 13 per cent of properties are under-occupied, down 3 per cent from the previous year. The age group most likely to reap the rewards of all this room is pensioners: more than a third (36 per cent) of Britain's homes are owned by this cohort. In the most recent census, 84.1 per cent of households where an over-65-year-old was the main resident were under-occupied. Conversely, the number of young people with no housing wealth at all – 44 per cent of 25 to 34-year-olds – is at a record high, according to Intergenerational Foundation analysis of ONS data shared with The Daily Telegraph. The average age of a first-time buyer in England has now risen to 34. And if you're one of those under 34-year-olds currently grappling with the, at times, completely unhinged rental market in this country? You are likely to be living in increasingly cramped conditions – put aside the number of bedrooms and the total amount of physical floor space is reducing. Nearly one in five properties for rent have less than 50 square metres of floor space, the minimum required by law for two occupants. The percentage of dwellings smaller than this has grown from 15.3 per cent a decade ago to 18.6 per cent today. Beneath all these numbers, percentages and statistics are the real people affected by the big squeeze. It's hard to argue against the sense of injustice that young people feel when their circumstances are contrasted with a generation who seem to have won the lottery of life: more rooms than they know what to do with; household wealth 33 times that of 16-24-year-olds; and who, according to previous analysis, are helping fuel the current housing shortage by refusing to downsize when their children have flown the nest. Households aged 65 to 74 are, in fact, getting richer at the fastest rate of any generation. But back to space. It can be something of an abstract concept – the kind of thing that you barely notice when you have enough of it, but whose absence is profoundly felt and impossible to ignore. The Covid pandemic shone a light on this discrepancy like nothing else, splitting the population into the haves and the have-nots – a divide less to do with disposable income and more to do with the tolerability of your living situation. Baby boomers safely ensconced in four-bedroom detached houses in the countryside with rambling gardens and acres of green space on the doorstep wondered what the fuss was all about when we entered lockdowns, chastising everyone else to just 'keep calm and carry on'. Those of us trapped in one-bedroom flats without so much as a balcony, at the whims of landlords who could up the rent at a moment's notice, had a markedly different experience. Beneath all these numbers, percentages and statistics are the real people affected by the big squeeze I still remember, at the tail-end of restrictions, searching for a room in London after breaking up with my long-term partner. Competition among renters was particularly fierce at a time when many people's circumstances had changed, with anything half-decent or reasonably priced snapped up within days. The low point came when I was shown a 'six-bedroom' flat, sold on the flexibility of its rolling monthly contract (meaning I could leave – and therefore get kicked out – at a moment's notice. How exciting!). The other catch quickly became apparent: there was no longer a living room, the private landlords having chosen instead to convert this into the sixth bedroom to maximise profits. The only 'communal' space left was the kitchen, so small there wasn't room for a table. The 'bedroom' would therefore have to serve as lounge, dining room and office when working from home, all rolled into one minuscule and deeply depressing package. It was difficult, at the time, not to feel resentment towards the older people I knew who would attend Zoom events from their spacious home office or jump on a call from their sun-dappled gardens, answering emails while getting a tan. 'The continued widening of the gulf of housing wealth between generations is deeply concerning,' Toby Whelton, from the Intergenerational Foundation, said of the think tank's latest analysis. 'If these trends of low homeownership continue for younger generations, it will mean that when younger generations reach state pension age, the majority will not enjoy the same security of owning their own home and will be forced into renting into very old age.' It's hard to see how the tide might turn. In November last year, the average UK house price was £290,000 – 10 times the average salary for a 22 to 29-year-old. Thirty-five years ago, baby boomers could pick up a house for around five times the average salary. Their money went twice as far. Nothing about that is fair. No, it's not baby boomers' fault that they benefited from growing up in a completely different economic landscape. No, pitting old against young does nothing to bring us together as a nation following a turbulent few decades of austerity, Brexit, coronavirus and all the rest. But Britain's young people have good reason to be mad as hell. We may indeed have 'more in common', but wouldn't it be nice to live in a world where one of the things we all had in common was access to affordable housing?
Yahoo
13-02-2025
- Business
- Yahoo
The ugly truth behind baby boomers and Britain's housing crisis
Boomer homeowners have at least two rooms to spare while younger people are forced to live in cramped rentals, analysis has revealed. Nearly 10 million homes in England had at least two unused bedrooms last year and were therefore considered under-occupied, according to the latest English Housing Survey. Pensioners made up the largest share of these homeowners, with around 36pc of Britain's 16 million properties owned by retirees. The issue is amplifying generational rifts. While pensioners enjoy ever more breathing space, the young are being squeezed into expensive rentals. It comes as a separate analysis of Office for National Statistics (ONS) research by the Intergenerational Foundation found that the number of young people with no housing wealth is at record highs. It has become harder for renters to find bigger properties, with the proportion of those with extra bedrooms on the private market falling from 16pc in 2022-2023 to 13pc last year. The proportion of rental homes with less than 50 square meters of floor space has increased to 18.6pc from 15.3pc a decade ago. This is equivalent to the minimum gross internal floor and storage area by law for a new-build single-bedroom flat for two people – with the absolute minimum for one being 37 square metres. However, owner-occupied homes are ballooning, with the share of those stretching over 110 square metres increasing from 34.7 to 38pc during this time. Not only are renters having to live in smaller homes, but the route to becoming a homeowner is getting harder as prices continue to rise. In 2008-2010, the proportion of 25- to 34-year-olds who have no housing wealth was 35pc. The latest data, which covers 2020-2022, found that 44pc now have no housing wealth. The average age of a first-time buyer hit nearly 34 last year, according to major lender Barclays, two years higher than at the turn of the century. The average price of a home in the UK was £289,707 in November 2024, according to the Land Registry – 10 times the average wage for those aged between 22 and 29. Baby boomers were eyeing up property worth an average of £58,000 at a similar age back in 1990, roughly five times their £12,500 pay packets at the time, meaning their money went about twice as far. Meanwhile, over-65s are the only group which has not seen an increase in the number of those without property wealth. The proportion of pensioners sitting on property wealth of more than £500,000 has jumped from 5pc in 2008-2010 to 18pc. 'The continued widening of the gulf of housing wealth between generations is deeply concerning,' Toby Whelton, from the Intergenerational Foundation, said. 'If these trends of low homeownership continue for younger generations, it will mean that when younger generations reach state pension age, the majority will not enjoy the same security of owning their own home and will be forced into renting into very old age.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
