Benefits for older Scots 'tearing society apart'

Chief Scottish Political Correspondent

Thursday 20 September 2012

THE range of universal benefits available to all pensioners in Scotland may lead to conflict between the generations, experts have warned politicians.

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ROBBIE DINWOODIE CHIEF SCOTTISH POLITICAL CORRESPONDENT

They have painted a bleak picture of a society torn apart by resentment towards an elderly population entitled to benefits such as free care and bus travel.

MSPs were told the Scottish Government might eventually have to abandon such benefits or tax the working population more to pay for them.

This could lead to "inter-generational breakdown" as young families with student loans and high mortgages bridle against being taxed to pay for free services for a "seriously lucky" older generation that grew up in an era of student grants and generous pensions.During a Holyrood debate on the Scottish economy yesterday, the finance committee was also warned that health professionals might have to consider "how protracted we wish to make people's deaths". Colin Mair, chief executive of the Improvement Service, a partnership between local authority chief executives and council umbrella body Cosla designed to improve local public services, said: "If there appears to be a generation that just happened to hit it seriously lucky across the whole of its lifespan – it never paid tuition fees or anything like it when they were students and got grants; they had a basic state pension; a state earnings-related pension; a good occupational pension – there may be some resentment among young people about paying so that those people can have free services in their old age even though their incomes are actually higher than the younger people who are paying the tax to pay for the services."Some people seem to be doing very well and if economic growth happens, that is very bad news."He suggested any rise in interest rates from their record low of 0.5% would leave about 20% of households across Scotland in real trouble.Mr Mair added: "The only thing that's holding their household finances together at the moment is that interest rates are at a staggeringly low level by historical standards. A 1% to 2% increase in interest rates, and they're gone."He suggested political parties committed to free services for the elderly might have to renege on their promises or raise taxes.He added: "Either we are going to make much more substantial cuts in other areas of public service – and I find it hard to see where they are going to happen – alternatively, we are going to have to be tax-willing as a country and have the fiscal tools to be tax-willing to support what we are doing." Grant Costello, chairman of the Scottish Youth Parliament, said: "It's been clear for years young people are expected to clear up the mess left by previous generations. We face high youth unemployment, an increased cost of living, low wages, and no hope of buying a house before 30."Doug Anthoney, of Age Scotland, insisted that pitting generations against each other was wrong-headed, saying many older people struggled. He added: "We are very keen that generations are not played off one against each other, and we are looking to bring generations together to look at shared problems."Alan Sinclair, from the Glasgow-based Centre for Confidence and Wellbeing, said policymakers had to "take into account the state of the Scottish, UK and European economy over the next two to three decades" in their projections for care for elderly people.He said: "There is an implicit assumption that if we hold our breath, in five years things will get better."He said Harvard professors, who modelled financial collapses from the last 200 years, found that, on average, it took countries with similar levels of modern debt 23 years to recover, and they had average negative growth of 1.2%.Meanwhile, Lord Sutherland, the architect of free personal care for the elderly, cast doubt on his policy and warned the Government not to cut "better-value" support to voluntary organisations.Speaking on behalf of the Royal Society of Edinburgh, he said voluntary organisations gave "more bang for their buck" when providing services for elderly people.Lord Sutherland added: "The worry is that when times are tight, and they are going to get tighter, it is the voluntary organisations that are the first to be cut, in terms of local authority expenditure."You get more bang for your buck with the money you put into an organisation like Alzheimer Scotland. "What they get in terms of the local support, in terms of volunteers, is good value for money."

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Benefits for older Scots 'tearing society apart'

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