The editorial ‘Concerns hit low-income earners’ (August 2) triggered the members of the Alliance of Pensioners Organisations to raise some points and grievances that affect pensioners’ income and purchasing power.
It was pointed out to the administration that “it is essential not to neglect the plight of pensioners who, although they may not be on the poverty line, are finding it increasingly difficult to make ends meet”. It has to be stated that thousands are moving towards the poverty line and thousands more are at risk of poverty.
The important appeal to the administration in support of pensioners is very much welcomed by the AOP, and it wishes to confirm that this is the current reality faced by thousands of pensioners. It is hoped that Gvern li jisma’ will listen and, from words, will move to action. First of all, poverty measurement should not cover the single person only but all the members of the household. Normally, in the case of the elderly, a household consists of two members.
It was recently established through the introduction of the guaranteed national minimum pension that to stay away from the risk of poverty, a single person needs a disposable income of €147 a week. On the other hand, a couple or two-person household requires €221 weekly. With the introduction of the new benefit, in the case of a single person, this level has been reached. However, in a two-person household getting one pension only, so far €160 a week is received, that is, €61 short of the €221 desired standard.
According to the Caritas report about the minimum essential budget for a decent living, an elderly couple (65+) needs well over €10,000 a year.
In this unpleasant scenario, the AOP would like to raise some points and mention the reasons leading to the erosion of pensioners’ income on a regular basis and drastically affecting the purchasing power of all pensioners, particularly those aged 75 and over. Naturally, this situation is leading to serious concern among this cohort of the population.
The major problem is dealing with regular increases in the prices of goods and services. The prices for all types of food, especially groceries, vegetables and fruits, meat and fish, increased considerably.
Pensioners are finding that expenses linked to home maintenance, household appliances, car maintenance, licences and insurance are exorbitant and becoming unaffordable.
People are living longer. It is a fact that health problems increase the more we age. This is another area where older people spend a considerable amount of their income. The fees asked by health professionals are always rising.
Thousands are moving towards the poverty line and thousands more are at risk of poverty
Regular expenses on pharmaceutical goods are another financial burden on older people.
Pensioners who are not homeowners have to pay rent. Given the increase in the number of foreigners on our island, the demand for rentals is higher and rents have gone up alarmingly. This change, carried out in the name of progress, economic growth and wealth creation, causes uncalled-for hardship to a considerable segment of our population.
Pensioners are finding it difficult to make both ends meet. In this precarious situation, the government should intervene as early as possible and put in place a proper mechanism to assure the wealth generated through economic growth is fairly distributed and trickles down to the vulnerable, poor or those at risk of poverty.
To address the above social problems, the APO would like to make to some proposals.
The minimum income for a two-person household should be increased to €221 a week. There should be an adjustment to the maximum pensionable income ceiling, reflecting today’s earnings.
A proper indexation of the pension, including a basket of goods and services needed, should be introduced. The system in place is discriminatory, and the APO’s proposal would be a good step to mitigating the regular erosion of pensioners’ income and enhancing their purchasing power, avoiding the embarrassment these vulnerable people have to face.
There should be a solution to the service pension problem. For the last 37 years, those entitled to a service pension have been treated unjustly by different administrations. To enhance the income of older people, the 15 per cent withholding tax should be abolished.
To encourage older people to stay longer in their homes instead of going to State institutions, the government is paying €300 yearly to those over 75. This amount should be raised further.
The above represent the realities of low-income earners. While experiencing an economic boom, it is now expected that, concurrent with the economic area, the government will address the social dimension properly for the next two years. Failure to embark on this mission will result in an unpleasant social impact where the rich get richer and the poor become poorer.
Carmel Mallia is president, Alliance of Pensioners Organisations.