United Kingdom
Older people in low income
Key points
- The proportion of pensioners living in low income households has been falling throughout the last decade, from 29% of all pensioners in 1996/97 to 17% in 2005/06.
- Pensioners are now less likely to be living in low income households than non-pensioners.
- The fall has mostly been among single pensioners rather than pensioner couples, although the proportion of pensioner couples who are in low income households has also been falling since 2002/03. 19% of single pensioners are now in low income households compared 39% in 1996/97. By comparison, the proportion of pensioner couples in low income has fallen from 22% to 16%.
- Single female pensioners and older pensioner couples are the most likely to be in low income.
- Pensioners aged 75 and over are more likely to live in low income households than younger pensioners. This is not, however, because the risks of low income for single pensioners rise with age. Rather it is because of a combination of a) the proportion of pensioners who are single rises with age and b) the risks of low income for pensioner couples rises with age.
- Three-fifths of the pensioners in low income are in pensioner couples and the other two-fifths are single pensioners. A third are aged less than 70, two-fifths are aged 70 to 79 and the remaining quarter are aged 80 or over.
- Unlike working-age adults, very few low income pensioners have a very low income.
- Apart from inner London (where it is much higher), the proportion of pensioners living in low income households is similar in all regions.
Graph 1: Over time
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Graph 2: By household type
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Graph 3: By age
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Graph 4: Shares
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Graph 5: By depth
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Graph 6: By region
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Map
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View interactive version of map (by ward rather than by super output area; opens in a new window)
Download a spreadsheet with the ward-level statistics
Download a spreadsheet with the district-level statistics
Why this indicator was originally chosen
Although pensioners on average enjoy better incomes than they have in the past, this rising average conceals a large minority who have no additional resources other than the state retirement pension and means tested benefits.
Definitions and data sources
The first graph shows the risk of a pensioner being in a low income household (defined as the proportion of people with incomes below 60% of median household income after deducting housing costs), with the data shown separately for single pensioners and pensioner couples.
The second graph shows how the risks have changed for people in different family types, including pensioners. Note that a couple (and therefore both of its adults) is classified as a pensioner couple if either of the adults is of pensionable age.
The third graph shows the proportion of pensioners living in low income households for different combinations of age group (less than 75 and 75 & over) and family type (pensioner couple, single female pensioner and single male pensioner).
The fourth graph shows the share of the pensioners living in low income for different combinations of age group and family type.
The fifth graph shows the numbers of those on low income in the latest year grouped by family type and divided according to how much additional money the household would need a week to reach the threshold of 60% of contemporary median income after deducting housing costs.
The sixth graph shows the risk of pensioners being in low income households by region.
The data source for all the graphs is Households Below Average Income, based on the Family Resources Survey (FRS). For 2002/03 onwards, the data relates to the United Kingdom whilst the data for earlier years is for Great Britain (FRS did not cover Northern Ireland until 2002/03). Income is disposable household income after deducting housing costs and the low income threshold is the same as that used elsewhere, namely 60% of contemporary median household income. In the first four and sixth graphs, the data is equivalised (adjusted) to account for differences in household size and composition whilst in the fifth it is not equivalised. The self-employed are included in the statistics. Note that in 2007 DWP made some technical changes to how it adjusted household income for household composition (including retrospective changes) and, as a result, the data is slightly different than previously published figures.
The map shows how the number of people in receipt of the guaranteed part of Pension Credit (previously called the Minimum Income Guarantee) varies by ward. The data is for February 2007. The data source is the DWP Work and Pensions Longitudinal Study.
Overall adequacy of the indicator: high. The FRS is a well-established annual government survey designed to be representative of the population as a whole. However, since it only covers people living in private households, and not residential institutions (such as nursing homes), it does leave out a significant group of older people.
External links
See the DWP sites on Pension Credit and Winter Fuel Payments.
Relevant 2007 Public Service Agreements
Overall aim: Tackle poverty and promote greater independence and well-being in later life
Lead department
Department for Work and Pensions.
Official national targets
None.
Other indicators of progress
Employment rate age 50-69: percentage difference between this and overall employment rate.
Pensioner poverty.
Healthy life-expectancy at age 65.
Over 65s satisfied with home and neighbourhood.
Over 65s supported to live independently.
Previous 2004 targets
By 2008, be paying Pension Credit to at least 3.2 million pensioner households. While maintaining a focus on the most disadvantaged by ensuring that at least 2.2 million of these households are in receipt of the Guarantee Credit.
Relevant government policies
The numbers
Graph 1
| Year | Pensioner couples | Single pensioners |
|---|---|---|
| 1994/95 | 22% | 36% |
| 1995/96 | 23% | 35% |
| 1996/97 | 22% | 39% |
| 1997/98 | 22% | 38% |
| 1998/99 | 22% | 37% |
| 1999/00 | 22% | 35% |
| 2000/01 | 21% | 33% |
| 2001/02 | 22% | 30% |
| 2002/03 | 22% | 27% |
| 2003/04 | 19% | 23% |
| 2004/05 | 17% | 19% |
| 2005/06 | 16% | 19% |
Graph 2
| Average of 1994/95 to 1996/97 | Average of 2003/04 to 2005/06 | |
|---|---|---|
| Single pensioners | 37% | 20% |
| Pensioner couples | 22% | 18% |
| Working-age couples without dependent children | 10% | 11% |
| Working-age couples with dependent children | 23% | 20% |
| Working-age singles without dependent children | 24% | 23% |
| Working-age singles with dependent children | 62% | 50% |
Graph 3
| Age group | In pensioner couples | Single women | Single men | All pensioners |
|---|---|---|---|---|
| Aged 60/65 to 74 | 16% | 21% | 16% | 17% |
| Aged 75+ | 21% | 21% | 17% | 20% |
Graph 4
| Group | Number | Proportion of total |
|---|---|---|
| Single pensioners aged 60/65 to 69 | 200K | 12% |
| Single pensioners aged less than 70 to 79 | 300K | 16% |
| Single pensioners aged 80 and over | 300K | 16% |
| In pensioner couples aged 60/65 to 69 | 500K | 25% |
| In pensioner couples aged less than 70 to 79 | 400K | 22% |
| In pensioner couples aged 80 and over | 200K | 9% |
Graph 5
| Millions of people | |||
|---|---|---|---|
| Family type | Up to £50 below | £50-100 below | More than £100 below |
| Working-age adults without dependent children | 1.4M | 1.0M | 1.3M |
| Couples with children | 1.4M | 1.0M | 1.7M |
| Lone parent families | 1.5M | 0.7M | 0.4M |
| Pensioners | 1.6M | 0.4M | 0.2M |
Graph 6
| East | 18% |
|---|---|
| East Midlands | 21% |
| inner London | 27% |
| outer London | 19% |
| North East | 17% |
| North West | 19% |
| Northern Ireland | 19% |
| Scotland | 18% |
| South East | 16% |
| South West | 16% |
| Wales | 20% |
| West Midlands | 20% |
| Yorkshire and The Humber | 17% |