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Opinion

Your RORA idea: What ‘costs’ more, unemployment benefit or state pensions?

Reader Paul M. wonders whether retirees and pensioners can step aside to loosen up some space in the jobs market for younger generations.

Is it more economical (ie ‘cheaper’) to pay long-term unemployment benefit than it is to pay an increase in the state pension?

It’s a simple question for starters. It must be better to have many thousands in paid work paying tax than it would cost the Government to pay out an enhanced rate to pensioners willing (and able) to step away from the workplace.

An unemployed person is unable to contribute to either the state (and all the other societal costs that entails) or do much to move their own lives forward. And the young unemployed might be claiming benefits a hell of a lot longer than most pensioners will be claiming a pension.

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I’m sure that we all know of many seniors who continue to work, some of necessity, not all by choice, but who, with the prospect of an enhanced state pension and with more modest needs, might be better placed to consider an earlier retirement from the workplace. This would free up the job market for those more in need and, frankly, more longevity.

No way should this be mandatory, but when there are finite resources — by which I mean jobs — to go round, those that can, might consider sharing more equally for everyone’s greater benefit.

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Alternatively, and this could be considered a step backward, but we lower the pension age.

At this stage of the game, money aside, time is the only thing we can’t buy more of

In contrast to the idea of an ever increasing retirement age, keeping us all in chains ‘til we drop, this would be an opportunity to give the seniors a well-earned break to enjoy the time left to them. And it would also give the youngsters a chance to start building their lives.

It’s not news that many (not all of course) pension-age workers will have mortgages paid off, kids left home and adequate finances built up over the years. And this group already benefits from subsidised travel and medical care.

Seniors with a lifetime of work behind them manage on what they’ve earned so far, and will doubtless have to find ways to manage when pensioned off. But at this stage of the game, money aside, time is the only thing we can’t buy more of.

I hope I have made a fair point of what, I daresay, is an immensely complex topic. Thanks for listening.

Regards

Paul M.

Do you have your own big ideas on how we can prevent homelessness and protect jobs in the wake of the Covid-19 pandemic? Let us know at rora@bigissue.com

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