A Report on Isle of Man Retirement Pensions Sept 2009
by The Rev'd Cyril Rogers Social Responsibility Advisor Diocese of Sodor and Man
Introduction
In 2008 I met with members of the Isle of Man Pensioners' Association (IOMPA) to be briefed on their work. IOMPA campaign on a single issue: to obtain the Isle of Man Pension Supplement for all those who have been resident on the Isle of Man for 10 or more years.
Having heard their concerns I decided to widen the scope of my enquiry to look at the general situation for pensioners on the island.
Due to pressure from other work it has taken longer than I expected to complete this report.
In one sense this delay has been advantageous as recent developments have created new possibilities of progressing pensioners' issues. Specifically the creation of the Third Sector Strategy and the formation of the Council of Voluntary Organisations (CVO) provide two new forums where such issues can be addressed.
The Isle of Man Pension Supplement.
In 1992 the Chislett Report, recommended that a supplement be paid to all pensioners, subject to a residency qualification, to be decided by Tynwald, as this would eliminate the dependency of most pensioners on Supplementary Benefit.
The DHSS, in formulating these proposals, changed the qualifications to 10 years contributions to the Isle of Man National Insurance Fund. This was accepted by Tynwald, on the basis that those who had paid in should reap the benefit, so that the 10-year rule was accepted, though many members expressed reservations about the long-term divisive effect.
The supplement now gives those who qualify a 50% increase in their pension and we have in effect a two tier pension system which puts at a disadvantage those who have not contributed enough, including those of Manx birth, who had been obliged by economic circumstances to earn their living off the Island.
Politicians show little desire to change the system, despite the initial misgivings noted above.
The DHSS Minister rejected a proposal made by IOMPA that people be allowed to pay additional Class 3 NI contributions in order to qualify.
With regard to the overall picture the Minister argues that increasing current pensions would rob future pensioners.
IOMPA argue there is sufficient funding to support their scheme.
The Wider Situation.
I note that there is a difficulty in assessing numbers of people affected due to a lack of statistics, a problem I have encountered in dealing with other social issues on the island. However anecdotal evidence and personal experience of cases show that there are real issues of poverty on the island. This includes those on low wages or disability pensions as well as retirement pensions. There is a slogan that in winter many pensioners have a choice between eating or heating. Derek Hartup of Justice for Pensioners gives alarming figures showing how projected rising fuel costs will affect pensions.
High house prices or rents impact on those with low incomes in general, including pensioners.
With regard to residency qualifications, newcomers to the Island can find themselves particularly vulnerable. This can include people on retirement pensions who move to the island to be closer to family working here who wish to care for them in their old age.
Conclusions
In the current situation I see no real hope that politicians with take IOMPA's case seriously.
I did come across one attempt to redefine the benefit as a reward for a contribution to the Manx economy instead of the original definition of a measure to compensate for the higher cost of living on the island. My reaction to that is OK then, but the basic pension needs to enable a person to live comfortably on the island.
In the long term changing demographics may force a change in their attitude.
With immigration we already have the situation where native Manx people now form just under 50% of the population. If this continues and as the population ages, a two tier pension system could become an electoral vote loser.
I do believe that IOMPA have a case. A two tier situation is inequitable and does leave some disadvantaged. I would go further than IOMPA who would base qualification on a residency period. My experience shows that a residency qualification period can leave people unprotected. We live in a world with a mobile population and our social provisions need to take account of that. In the short term we are faced with a situation where those on low incomes, wages, disability or retirement pensions, are vulnerable, sometimes dangerously so.
In 2008 Age Concern publicly stated their fears on this issue.
The Third Sector and CVO forums will I believe help address these issues.
I also am working on setting up a Church Social Responsibility Group, whereas at present I am a single part time officer. This would enable the church to take a fuller part alongside these groups. Particular needs that I would like to see addressed include the need to increase the provision of decent low cost housing, and to provide the appropriate financial assistance to those on low incomes for house insulation.
Energy Conservation Schemes are being promoted as a necessary response to climate change, but those on low incomes can not afford such measures. To assist them would give long term reductions to their fuel bills, addressing the concerns expressed by Derek Hartopp.
Most of all though we need to ensure that our benefits system does not leave people vulnerable, even dangerously vulnerable.
References
1. www.isleofmanpensionersassociation.com/background.htm
2. THE FUEL COST CRISIS IN THE ISLE OF MAN www.justiceforpensioners.com/iomfuelcost.html
3. Stark warning from Age Concern over increased power charges Published 4 August 2008 www.iomtoday.co.im/news/Stark-warning-from-Age-Concern.4354638.jp