24 July 2006 - Publication of three DWP research reports
In line with its commitment to explore ways of measuring pensioner poverty, DWP is publishing three research reports on older people and poverty issues:
- Which pensioners don’t spend their income and why?
- Understanding older people's experiences of poverty and material deprivation
- Are ‘poor’ pensioners deprived?
These reports are a mixture of analysis of existing survey data on pensioner spending and measures of material deprivation and interviews and focus groups with older people.
Key Findings:
Taking all three reports together the range of findings included:
On spending and managing money
- As people get older they tend to spend less of their income. Other characteristics associated with older people spending a low proportion of their income included: being a home owner; from the higher income groups; engaging in saving/putting a bit by; experiencing isolation; or not having access to transport.
- Sizeable minority felt better off in retirement but most did not and for many expectations of retirement were generally low and most realised they had to cut back and revise their lifestyle (particularly among the newly retired).
- Most were ‘careful money managers’ adopting meticulous budgeting strategies because of the fixed nature and lower level of their income in retirement; fear of debt; and a strongly felt need to protect savings.
- The overwhelming majority were currently saving with most doing so informally (i.e. at home or current accounts) and used them for short term needs (e.g. lumpy expenditure such as bills or planned expenditure such as presents).
- Many praised Winter Fuel Payments as helping them manage fuel expenditure
- Financial/material support from the family was common and seemed to be a protective factor against possible deprivation.
On Material Deprivation measures
- Material deprivation questions ask about whether people don’t have, and can’t afford certain basic goods and services (e.g. a holiday away from home, to replace worn out furniture, and adequate heating).
- The research helped increase our understanding of how deprivation measures work for older people. It showed that, as well as income and savings several other factors determined whether older people had or wanted certain items, including: lifetime income; health; changing expectations associated with changing incomes and/or declining mobility; material support from the family; and attitudes (i.e. pride and feeling embarrassed to admit ‘can’t afford’ items).
Notes to Editors
The reports published today are:
- Report number 334, Which pensioners don’t spend their income and why? (University of York). This is available online at: http://www.dwp.gov.uk/asd/asd5/rrs2006.asp#why
- Report number 363, Understanding older people's experiences of poverty and material deprivation (University of Bristol). This is available online at: http://www.dwp.gov.uk/asd/asd5/rrs2006.asp#material
- Report number 364, Are ‘poor’ pensioners deprived?(University of Essex). This is available online at: http://www.dwp.gov.uk/asd/asd5/rrs2006.asp#deprived
Prepared by: Department for Work and Pensions Pensions Analysis Directorate