CSO SILC Elderly Living Conditions: CARDI analysis
- Republic of Ireland
Older people with the lowest incomes gained least in the last years of the Republic of Ireland’s economic growth and they are now losing more than their colleagues on average incomes.Paul McGill, Strategic Research Officer provides a brief analysis of the CSO's latest release:
Figures released by the Central Statistics Office today show that the bottom fifth of people aged 65+ had incomes pitched at 53.2% of the average in 2004 but this fell to 48.8% in 2009 and fell again to 47.0% in 2010. Compared with the best off older people (top quintile), the poorest fifth fell from 26.2% to 23.1% over the six year period covered by the statistics. See Figure 1 for income changes by quintile 2004-2010. We can see that the lowest group had a modest overall increase in weekly income of €35.79, compared with €85.03 for the next group, €100 for the middle group, €116.20 for the second richest fifth and a substantial €233.62 for the richest older people.
The CSO notes that the average income people aged 65+ declined by 6% between 2009 and 2010, contrary to the view that older people have been protected from the effects of the recession.
More importantly, the incomes of the poorest fifth of older people declined by 9.5% in the latest year, from €209.41 to €189.56 per week. The incomes of the richest fifth of older people also declined sharply, by 9.9% (€911.44 to €820.91). This means that the three middle-income groups declined less sharply by between 1.3% and 3.1%. These changes between 2009 and 2010 are shown in Figure 2.
Most of the decline in the incomes of the poorest older people between 2009 and 2010 came from a reduction in social transfers of €15.59 per week; income from employment also fell by €3.37 and there were smaller declines in investment income and property income.
It might be imagined that older people on the lowest incomes would receive the largest amounts of money in social transfers, but this is not the case. In fact income from social transfers increases for better off households follows (2010 figures):
One possible explanation is that better-off older people are more likely to have worked continuously and are entitled to the full State pension whereas the worst off older people rely on the lower, non-contributory social assistance pension.
The overall picture of the CSO statistics is that both the risk of poverty among people aged 65+ and their rate of deprivation are unchanged between 2009 and 2010 and much lower than in 2004. This good news must be seen in the context of growing inequalities and in the context of important differences highlighted by the CSO statistics e.g. in household composition. The highest average incomes were enjoyed in 2010 by two people both aged 65 living together (€446.94 per week), a decline of €5.35 since 2009. The lowest incomes were held by people aged 65+ living alone, whose incomes fell by €9.71 in the latest year to €352.18. In between are ‘other family compositions’ who had an average income of €401.98 in 2010 but this represented a decline of €77.21 per week, mostly due to a decline in earnings of €48.54.
Paul Mc Gill
9 August 2012