Budget lacks any solutions to 50+ NETER employment crisis
The Chancellor John Healey has delivered his first Budget speech in Parliament today, describing it as a Budget for the "working people of Britain, for British businesses big and small".
The Centre for Ageing Better has welcomed the Chancellor’s confirmation that local authorities will get greater devolved financial powers but is disappointed that nothing has been announced helping people in their 50s and 60s to find work.
John Healey has set out his first Budget as Chancellor with a bid to provide “breathing space” for the public amid a difficult domestic economic situation made worse by the turmoil of the Iran war.
As part of his speech, the Chancellor talked about local apprenticeships matching young people with local firms and the fact that he refused to write-off one million young people with the report of the Milburn Review into NEETs confirmed as being published next month.
Absent from the speech however was any reference to supporting older workers – even though our NETERs campaign has revealed there are almost 3 million people between 50 and state pension age in this country currently not in employment, training, education or retirement with around one in three of these wanting to be in work.
Dr Carole Easton OBE, Chief Executive at the Centre for Ageing Better, said:
It is deeply disappointing that the Chancellor has not provided more for older workers in this Budget.
“While the government is right to target the NEET crisis by including measures to reduce the costs of hiring young people, he has regrettably overlooked a similar emergency amongst older workers.
“Our new NETER campaign has identified three million people out-of-work in the UK aged between 50 and state pension age with NETER rates almost double NEET rates in some parts of the country.
“While the government has a clear plan to tackle the NEET crisis, there is nowhere near the same level of focus and resource dedicated to NETERs.
“The Chancellor has promised a new settlement for older generations. But this should not be restricted to pension and social care reform. Almost one million older people are not in work but would like to be. Where is the new settlement for these people in this Budget?
“The government cannot hope to achieve its stated aim of good growth in every postcode across the country without urgently arresting the huge drop-off in employment rates once people enter their 50s and 60s.”
The Chancellor also announced measures to tackle rising energy costs with a £2.6 billion support package for around 20 million households in council tax bands A to D who will receive £100 help with bills.
It is estimated that the support will reach four in five of households in England with the cash landing in people’s bank account from January.
Responding to the announcement, Dr Easton said:
“The British public has endured five miserable years of relentlessly rising energy prices, with further double digit percentage rises predicted for January.
“So while it is welcome that the Chancellor has acknowledged the cost of energy is placing an intolerable burden on many household budgets, the measures announced in the Budget only offer relief in the short-term and to the tune of a couple of hundred pounds, an amount which could be wiped out by sustained geopolitical turmoil.
“More than 3 million pensioner households are in fuel poverty with around a third spending more than 20% of their income on energy.
“For the government to ensure their Warm Homes Plan delivers the long-term overhaul of our poor energy efficiency housing stock that this country desperately needs, it should be delivered through a national network of one-stop shop Good Home Hubs to bring home improvement support to people's doorsteps.
“This is especially the case for older and low-income households living in poor-quality housing who need the support the most, but often receive it the least.”
The Budget also confirmed that pensioners on low incomes will be shielded from income tax.
The state pension is expected to increase by 3.9% to £13,036.40 a year from April which would take it above the £12,570 personal tax allowance.
By introducing the Pension Tax Allowance from April 2027, the government aims to reduce the disproportionate administrative burden of paying small amounts of tax for those whose incomes only just exceed the Personal Allowance.
Dr Easton said:
Low-income pensioners will be grateful of the Chancellor’s actions that will spare them from paying income tax on the state pension.
“More than one million people rely solely on the meagre state pension and entitlements for their income.
“It is right that this targeted intervention helps those with the least in retirement who are most vulnerable to the soaring cost of living where every penny counts.
“Preventing the state pension from being taxed is also a sensible move to limit bureaucracy, removing the prospect of one million cash-strapped pensioners from filing tax returns.
“However this is a minor victory when you consider that without years of threshold freezes, pensioners could by rights be enjoying a further £2,500-a-year tax-free income.”
The Budget also allocated greater fiscal powers to strategic and mayoral authorities allowing them to retain and raise significantly more income to fund projects within their regions.
Among the reforms, mayors will be able to retain 20% of business rates by the end of next year and can retain all business rates by the end of the decade.
Mayors can also receive income tax assignment from 2028, while legislation will give all strategic authorities the power to introduce an Overnight Visitor Levy.
Dr Easton said:
English devolution has the potential to tackle some of the key drivers of inequalities in ageing: poor housing, unsuitable work, inaccessible transport and public spaces, and limited community voice.
“Announcements in today’s Budget outlining the fiscal devolution roadmap granting regional mayors greater powers and resource are very welcome.
“To realise the potential of devolution for all within society, strategic and local authorities will need to ensure that ageing and diversity within their communities is a key consideration in the deployment of new powers.
“This means using evidence, involving older residents directly in decision making, and designing homes, services, transport and employment support that work for people across their lives.
“Doing this could have a transformative effect on our nation’s growing ageing population.”
The Chancellor also used his Budget speech to announce there will be no major changes to building regulations for the remainder of the parliament, except for improving building safety.
This comes as a disappointment to the Centre for Ageing Better who had hoped the government might go further than the existing 40% minimum for the proportion of new build homes that should be built to minimum accessibility and adaptability standards.
Dr Easton said:
We have a growing ageing population, which means that we urgently need more accessible and adaptable homes built.
“We are disappointed that the government has confirmed within this Budget that they are ruling out any further changes to the Building Regulations in this parliament, which means that they won't make the M4(2) accessible and adaptable standard the baseline for all new build homes.
“This makes it even more important that the government ensures that housebuilding over the coming years exceeds the national minimum of 40% of new homes being built to the accessibility and adaptable standard as part of its reforms to the National Planning Policy Framework.
“The need to significantly increase the amount of accessible housing in this country is of critical importance – the 12 million people currently living in homes that do not meet their accessibility needs are crying out for change.
“Accessible and adaptable homes are easier to live in, help more people live independently for longer, and ensure our nation’s housing is better suited to our growing ageing population."