Monday, July 25, 2016
Excellent video and report from the IFS not so happy about the intergenerational inferences
The IFS is to be congratulated in releasing such a high quality video to support its latest repoert about UK living standards. It really is well made and informative.
The report can be downloaded here.
As you will hear: "Recent years have seen a truly remarkable transformation in patterns of low income in the UK. One great success is that pensioner incomes have grown so much and, after housing costs, they are now the least likely major demographic group to be in income poverty."
This is great news and from a marketers perspective supports the reasons why older consumers are so important.
I do have one big gripe about the IFS. Maybe it is just me but I always get the feeling that in their reports and especially their contribute editorial to the financial press, they are inferring that the reason older people are doing is well is somehow connected to the reduction in income/wealth of younger age cohorts.
Trying to unpick how the IFS compares the single household of a 65 year with a families is fiendishly difficult. This is how it is explained in the report : The official HBAI income statistics currently use the modified OECD equivalence scale for BHC incomes, and an AHC variant from the Department for Work and Pensions (DWP). Gulp.
The IFS makes no adjustment for costs involved in older households - for example the spend on health related issues but it does take account of living expenses, even though their is obviously a big difference between renting and owing a property.I suspect if this was taken into account it would change the figures significantly.
I guess the bottom line of what I am saying is that the IFS is not trying to massage the numbers but I wonder how much effort it has taken to give a fair comparison between older people and the young.
Most people see the headline numbers and conclude - the oldies are doing OK at the expense of the young. It is a much more complicated story than that. Dick Stroud