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Pensions, Poverty, Retirement

Where does the proposed “£140 a week” for the new state pension come from?

A lot of people are wondering how the government has arrived at the figure of £140 a week for the proposed new state pension.  The justification I have heard (from a number of sources) for the apparently thumb-sucked figure is to ensure it is just above the Guarantee Credit ‘poverty line’, which is currently £137.35 per week for a single older person. This is the amount that the government says you need to live on as a minimum for an integrated healthy life.  While this is itself a made-up line, it tends to be in the same ball park as the more evidence-based budget standard poverty lines (for a single older person not suffering from any frailty, ill health or disability), for example as worked out by the Joseph Rowntree Foundation. Both the minimum income standard Guarantee Credit and the budget lines tend to be lower than the internationally (and officially) accepted ‘relative’ poverty line [60% of median household income,equivalised for household size], which, for example in the UK 09/10 (latest figures) was £166 per week for a single person (before housing costs). Noting though that the ‘after housing costs’ figure, used (sometimes controversially) by govt. for pensioners was £124 per week, I suppose the £140 also falls at the moment conveniently inbetween the ‘before housing costs’ and ‘after housing costs’ lines.

About gerontologyuk

Gerontologist with an interest in ageing and the lifecourse, well-being in later life, and social policy for an ageing society.

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