Nov 202012

This is weeks-old news, but I have written about it elsewhere so I’m posting most of what I wrote here too. Lord Bichard said:

“We are now prepared to say to people who are not looking for work, if you don’t look for work you don’t get benefits, so if you are old and you are not contributing in some way or another maybe there is some penalty attached to that.”

Obviously there were responses from groups representing older people. For example, Dot Gibson, general secretary of the National Pensioners Convention, said:

“This amounts to little more than national service for the over 60s and is absolutely outrageous.  Those who have paid their national insurance contributions for 30 or more years are entitled to receive their state pension and there should be no attempt to put further barriers in their way.”

Michelle Mitchell, director general of the charity Age UK, said:

“Older people are a hugely positive part of society – over a third of people aged between 65 and 74 volunteer, a percentage that only drops slightly for the over 75s.  In addition, nearly a million older people provide unpaid care to family or friends saving the state millions of pounds….  almost a third of working age parents rely on grandparents to provide childcare …”

Here are some of the articles:

This particular debate is largely about bureaucratic versus voluntary transfers of resources. Do we make money or other assistance flow via state-administered means or via charity and private means?

Resource transfer systems

Although a lot of attention is paid to the state’s formal transfer methods, including tax and benefits, there are also informal transfer methods that long preceded the state’s formal system. Charity is patchy. Local charities can be brilliant where the right people are involved, or non-existent otherwise. Ditto for family involvement. Bureaucrats might seek to spread the excellence everywhere. But human nature means that bureaucratic systems tend to spread mediocrity, not excellence; the latter can’t be captured by rules and processes.

Intergenerational resource transfer systems

Both systems do much more than intergenerational transfers, but that is an element of both of them. Neither is adequate on its own; if either ceased, there would be massive strains on the other. Both have to be taken into account in debates; any discussion about one of them is likely to be extended or countered by advocates of the other. Both systems will be part of any solutions.

Arguably, neither is adequately designed for the 21st Century, and they don’t work together in perfect harmony! In fact, there is probably inadequate knowledge of how they fit together, partly because there appears to be little detailed documentation of the intergenerational transfers of the informal system. How big are the informal transfers both from young to old and from old to young within families (etc)?

About Lord Bichard’s suggestion

Michael Bichard, Baron Bichard, was once Chief Executive of the Benefits Agency. This was the largest government department in the United Kingdom. (I have inadvertently become one of the people who is protecting his Wikipedia page from vandalism!)

Lord Bichard was the ultimate bureaucrat! The Benefits Agency was the largest alternative to and contradiction to charity in the UK. Initiative, innovation, compassion, and empathy, were replaced by rules and processes and targets. He is exactly the wrong person to consider how to exploit charitable and family involvement. It would be interesting to get proposals from charity leaders on how to balance giving and receiving across ages and wealths. It might need legislation, but to enable and encourage it, not to enforce it. Regulation can kill charity.

There are three problems with Lord Bichard’s proposal that I haven’t seen identified before:

1. As soon as benefits are conditional on work, an entire “industry” is needed to to identify who can work and how. In effect, the equivalent of the “Work Capability Assessment” (run by Atos Healthcare for claimants of “Employment and Support Allowance“) would be needed for pensioners, who obviously have a complete range from ability to disability.

2. The proposal at the start of the BBC article “Retired people could be encouraged to do community work such as caring for the very old” would require Criminal Records Bureau checks, (used for those interacting with children and vulnerable adults), probably at “Enhanced disclosure” level. So would many other sorts of community work intended to relieve the burden on taxpayers: the greatest costs to taxpayers tend to be those involving personal involvement with people.

3. Who would make the judgment that people had contributed enough to receive their pension, and how? Judgments about work done are normally made by managers, with disputes sorted out by tribunals, etc.

Since the media debate, Lord Bichard has said:

“I want to make clear that I have never suggested that pensioners should be expected to work for their pensions. I asked questions of witnesses at a select committee and these have been misrepresented on the BBC website as representing my views. They do not. I do think we should better recognise the talents of older people and encourage them to continue to contribute to their communities if that is what they want to do but never under duress.”

Further reading

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