Retired people are at a much lower risk of poverty than younger people

I'm Nobody said:

Most People now have stuff, too much of it, that they don't need we had nothing in the 60's and 70's.

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I think you'll find that people renting a box room in a shared house for example do not have much stuff, and they probably have no assets either.

Better than living in a ditch!

I'm Nobody said:

I've worked 7 days a week as well.
My first wage in 1973 was 8 pounds a week.

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That was a good wage. My fist wage in 1990 was a pound an hour.

I'm Nobody said:

Most People now have stuff, too much of it, that they don't need we had nothing in the 60's and 70's.

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House prices have more than doubled n real terms since then. Your home is by far the most important piece of "stuff" you'll ever own.

I'm Nobody said:

Where I am living now there were people living in mud huts against a ditch in the 1960's in Ireland.

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Really? How many of them? Was it some sort of a cult or a monastic settlement?
I know that Travellers were treated appallingly in the 60's and 70's, even worse than they are today, but were there even many of them living in mud huts?

This thread is about the relative wealth of older people, not who had what 50 years ago.
People who got on the property latter in the mid to late 80's are most likely to have made the biggest gains from the last and current property booms.

I'm Nobody said:

Better than living in a ditch!

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Yes, it's also better than being burned to death or assaulted or murdered and having your skin turned into a lampshade. So what?

Well its a bit extreme as an example, but I'll agree with you that living in a box room is better than the holocaust.
A pound an hour well done.
Not Travellers or a cult, just an ordinary family.
The point I am trying to make, obviously badly, is that pensioners that are well off today, were not well off when they were young and that is the way the world works.
,

I'm Nobody said:

The point I am trying to make, obviously badly, is that pensioners that are well off today, were not well off when they were young and that is the way the world works.

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My parents weren't particularly well off, yet they still had a succession of 'housemaids' when I was a toddler in the late 1950's. (I suspect that they came from an orphanage, the poor things.) It never struck as me as odd until it was too late to ask them about it. A different world back in those dark days.

Groucho said:

My parents weren't particularly well off, yet they still had a succession of 'housemaids' when I was a toddler in the late 1950's. (I suspect that they came from an orphanage, the poor things.) It never struck as me as odd until it was too late to ask them about it. A different world back in those dark days.

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Wow. I've always said that if you want middle income families to feel well off you need a dirt poor underclass to work for them. That's what they have in the USA. We don't have it so we have a squeezed middle. I'd rather have the latter.

I'm Nobody said:

The point I am trying to make, obviously badly, is that pensioners that are well off today, were not well off when they were young and that is the way the world works.

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And I'm saying is that our taxation and social policy was designed at a time when most pensioners were poor but now most are not so we should change it accordingly.

I honestly think the ESRI’s document needs to be looked at critically.

For example, Eurostat (Statistics | Eurostat (europa.eu)) tells us that the % of people at risk of poverty or social exclusion, in the 16 – 29 age bracket, in Ireland, declined from 31.35 % in 2015 to 19.0% in 2021, an achievement of which we should be proud.
Whereas for those aged 65 and older, the % of persons at risk of poverty or social exclusion, increased from 15.6% to 21.3% in the same period.

[I'm having difficulty inserting screen shots of the above but you can confirm them from the Eurostat data browser at: https://ec.europa.eu/eurostat/datab...gory&extractionId=ILC_PEPS01N__custom_3344568. ]

Now I am certain there are good reasons why the ESRI’s figures differ from those of Eurostat. But that’s for them to explain, but it would be unwise to use this report without a critical eye.

Allpartied said:

The headline in this post is that the older generation are at a lower risk of poverty than other generations. Some posters seem to think this is a bad thing, the retirees should be targeted and their perceived priveleges removed.

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This is an important point. Retirees are at risk, in a way others are not, that they lack the wherewithal to mitigate the risk of declining standards of living or even poverty. Simply because they do not or cannot work, or have other streams of income. The ESRI seem to be ignorant of this basic fact of life in their report.
Younger persons can always reduce the risk of lower living standards/poverty by work; education/skills improvement; savings/investment etc., and have longer to reduce the risk. This is not available to retirees, who must use live off their pension, and use savings, etc. as a buffer to maintain living standards in retirement. Public policy that e.g. increases taxation of retirees or reduces benefits will almost certainly tip many into poverty and reduce the living standards of others.

PMU said:

This is an important point. Retirees are at risk, in a way others are not, that they lack the wherewithal to mitigate the risk of declining standards of living or even poverty. Simply because they do not or cannot work, or have other streams of income. The ESRI seem to be ignorant of this basic fact of life in their report.
Younger persons can always reduce the risk of lower living standards/poverty by work; education/skills improvement; savings/investment etc., and have longer to reduce the risk. This is not available to retirees, who must use live off their pension, and use savings, etc. as a buffer to maintain living standards in retirement. Public policy that e.g. increases taxation of retirees or reduces benefits will almost certainly tip many into poverty and reduce the living standards of others.

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I agree. My issue is that social and taxation policy presumes that all retirees are poor. That is certainly not the case. As this discussion has developed my views have changed. I'm now of the opinion that things like free travel and health supports should remain but the age tax credit and reduced PRSI should be removed. Retirees who are at risk of poverty should get as much or more than they get now but those on high incomes shouldn't get tax breaks.

Note that there are various ways to measure poverty.

AROP is not the same as AROPE.

AROP means having a low income, below 60% of the median disposable income.

AROPE is a wider measure: it means having a low income, OR being deprived, OR living in a VLWI household.

At risk of poverty or social exclusion, abbreviated as AROPE, corresponds to the sum of persons who are either at risk of poverty, or severely materially and socially deprived or living in a household with a very low work intensity. People are included only once even if they are in more than one of the situations mentioned above. The AROPE rate is the share of the total population which is at risk of poverty or social exclusion. It is the main indicator to monitor the EU 2030 target on poverty and social exclusion and was the headline indicator to monitor the EU 2020 Strategy poverty target.

Here is the most recent SILC:

Here is table 3.1 from the SILC:

Protocol said:

AROP means having a low income, below 60% of the median disposable income.

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AROP is not really a poverty measure at all, it's an inequality measure.

Hypothetically

1. If everyone's income increased by a factor of ten tomorrow (and prices stayed the same) you would have exactly the same AROP measure as before.
2. If everyone's income was reduced to €100 a week (again no change in prices) you would have no one AROP any more.

Which scenario would you prefer?!


AROP is not useless but it has its limitations and those who make their living in the NGO space rarely acknowledge these limitations. It also doesn't change much from year to year. The earning potential of the adult population don't change very quickly, and neither does the tax or benefit system. Inequality is sticky in the short term although (from what we can tell) it has fallen materially since it was first measured in the early 1980s.

AROP rates

General = 13.2% in 2020, falling to 11.6% in 2021
Over 65s are typically lower than the national average, during the last few years.

Deprivation rates
General = 14% approx
Over 65= 8% approx

Consistent poverty = AROP plus deprived
General = 4.5 - 5% approx
Over 65 = 1% - 2%

Yes, I have heard Seamus Coffey describe AROP as more like a measure of income inequality.

I don't think one need worry too much about retired people having too much. The current inflation will reduce income and pension pot size( presumed lower stockmarket during inflation ) pretty substantially with little hope of recovery after retirement- for those with a private pension. I think( I may be wrong) public pensions will rise with pay awards of their grade.
It is also difficult to benefit from downsizing, unless your house is very expensive( and so having a large enough margin over the new property) when you take into account the costs involved including furniture, decoration etc etc and not forgetting the hassle of moving if you are happy in your own home.
At the very least lets see what happens with inflation over the next 2-3 yrs.

Red Helmet said:

I don't think one need worry too much about retired people having too much.

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I don't think anyone is worried about them having too much.
The discussion is about social and economic policies that are built on the false assumption that all or most older people are poor.

Red Helmet said:

The current inflation will reduce income and pension pot size

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The main source of wealth for older people is housing which continues to increase at double-digit rates, still ahead of inflation.