Are pensioners set to lose their free TV licence too?


The BBC is considering means-testing the free television licence for the over-75s, encouraged by Tory plans to do the same thing with pensioners' winter fuel allowance.

Currently, one in six households, or around 4.36 million people, get their licence free, rather than paying the £147 fee.

However, the BBC is now being urged to consider scrapping this benefit when it takes over responsibility for licences in June 2020, and has asked consultancy Frontier Economics to look at the options.

What the General Election means for pensioners

It's not the first time that the benefit has come under threat, but removing it has been seen as too unpopular in the past.

Now, though, the Conservatives have pledged to means-test winter fuel payments for pensioners, removing the benefit from up to ten million people.

And there's a perception that if the public can accept the loss of the winter fuel payment, they can accept the loss of the free television licence too.

"I can see a case for means-testing on the same grounds of why should a rich retired person get a winter fuel payment, so why should they get a free TV licence? former culture secretary John Whittingdale tells the Sunday Times.

"But these are matters for the BBC to consider. They could get rid of the free TV licence altogether."

However, the BBC says it's far from making a decision to withdraw or means-test the benefit, saying in a statement: "The BBC has no plan to make any changes to the current over-75s policy."

Up to now Conservative cuts have tended to hit young people hardest. However, the party's new election manifesto makes it clear that it's the pensioners' turn.

There are plans to scrap the triple lock that has made sure the state pension keeps up with prices, increasing in line with the rate of earnings, prices or 2.5% - whichever is higher.

MPs to cut pensions and benefits to help social care crisis

The Conservatives have also said that they plan to make drastic changes to the way social care for the elderly is funded if they win the general election on June 8.

People needing social care will have to find it themselves through the sale of their home, and will only be allowed to ring-fence £100,000 to leave to their family.

It's not the first time that means-testing pensioner benefits has been suggested - but many people are concerned that doing so will hit pensioners who are far from wealthy.

State pensions should be axed for rich pensioners

"The SDLP has been warning that part of Theresa's May rationale for calling this election is to free herself from the commitment not to make further welfare cuts 'in this Parliament'," comments SDLP South Down parliamentary candidate, Margaret Ritchie.

"Many over-75s rely on the free TV licence. Particularly for those with mobility or health problems who spend a lot of their time at home, television can provide a much needed link to local news, entertainment and popular culture."

How we spend our pensions
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How we spend our pensions

Figures from Saga show that the over 50s now account for the majority of money spent by Brits on travel and tourism. They have the time to spare, the money, and they are healthy enough to take on the world.

A poll from Abta found that in the wake of pension freedoms, 35% of people were considering cashing in at least part of their pension to travel. A separate study by Senior Railcard found that pensioners take an average of three holidays a year, plus two weekends away, and 17 day trips.

Research from Senior Railcard found that retirees eat out an average of three times a month. However, one in ten do so more than twice a week, and one in three people said that one of the first things they did when they retired was to go out for lunch with their friends.

Of course, just because retirees want to enjoy themselves, it doesn't mean they are happy to throw money away. The vast majority are keen to eat at lunchtimes, when a fixed lunch menu tends to be cheaper, and canny retirees are skilled at tracking down pensioner special offers too.

Figures from the Office for National Statistics show that on average nearly a fifth of the money spent by people aged 65-74 is on leisure. This includes everything from the cinema and theatre to golfing and gardening. They spent more on this than on food, energy bills and transport.

A report by Canada Life found that retirees are spending £4,279 a year on having fun - that’s more than £1,000 more than they spend on boring essentials, and is a 74% increase over the past ten years. It went on to predict that this trend was set to continue, and that pension freedoms would encourage people to spoil themselves a bit more in retirement

Pensioner property wealth is now over £850 billion, and all these family homes don’t look after themselves. The Senior Railcard survey put home renovations in the top 20 activities people got stuck into on retirement, and figures from ABTA found that almost a third of people who were considering raiding their pension pots under the new pension freedoms planned to spend the cash on their home. This seems like an eminently sensible investment - looking after what is undoubtedly their most valuable asset.

Unsurprisingly, while some pensioners are very well off indeed, others are struggling with debt. Figures from Key Retirement found that the average retiree has £34,000 of debt.

Most of this is mortgage borrowing - in many cases driven up by the number of people who unwittingly signed up to an interest-only mortgage. However, credit cards, overdrafts, and loans are also common. It’s why so many pensioners have used pension freedoms to access enough cash to pay their debts.

The day to day basics are swallowing up their fair share of pensioner cash too. On average, people aged 65-74 spend a third of their weekly income on essentials like food and bills - which is hardly living the high life.
The bank of gran and grandad has become an increasingly vital source of cash for families. According to Key Retirement, of those who release equity from their property, 21% of them use the cash to treat their children and grandchildren. This includes an average of £33,350 to help children get onto the property ladder, £6,000 to buy them a new car, £11,000 on family weddings, and £24,780 giving grandchildren a helping hand.

While retirees are quite rightly spending what they need to enjoy retirement, they are hardly all throwing caution to the wind, buying flash cars and spending the kids' inheritance.

Most expect to have something left over to pass onto their family after their death. Some 69% expect to leave property in their wills, and 75% expect to leave cash - according to - because while baby boomers know how to have fun - they also know how to save for the future.


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