Thematic Report on the Elderly from the EU-SILC Post author By Seamus Coffey Post date August 15, 2013 The CSO release is here. Categories In Inequality, Social conditions 29 Comments on Thematic Report on the Elderly from the EU-SILC ← Journal of Economic Perspectives (Summer 2013) → WaPo: Can Ireland’s Celtic Tiger roar again? 29 replies on “Thematic Report on the Elderly from the EU-SILC” Social transfers. Ireland’s story (or is it epitaph)? Dúirt mé leat go raibh mé breoite. I told you I was ill. I had fun today watching this report being interpreted First out IT – just before noon: “Older people at greater risk of poverty,statistics show” But they changed their minds and re-wrote it: “Older people continue to fare best from recession” The Indo stuck with the standard narrative: “Elderly incomes fall by €1,100” and for good measure explained: “As controversy rages about proposals to cut the old age pension a new study shows that elderly people have taken a significant hit in income.” Then the Pr’s flew in and the IT had second thoughts “Suggestion elderly faring better amid recession rejected” If you’re rearing a family and someone’s lost their job and there’s a house in negative equity, 5% looks like nothing. Especially when OAP income increased by 48% in the boom. My favourite line was this from ICTU’s “retired workers committee” “My concern is that poorer older people are getting done and their voices are not loud enough,” he said. Is he having a laugh? The poorest quintile have fared significantly worse than the others – both in the 2004-9 period and in the 09-11 period. avg equivalised income: quintile 1 2 3 4 5 2004 154 189 215 301 587 2009 209 277 321 430 911 2010 197 276 322 427 841 2011 185 274 312 424 842 this gives the % change in various periods: quintile 1 2 3 4 5 2004 to 2009 36 47 49 43 55 2009 to 2011 -11 -1 -3 -1 -8 2004-2011 20 45 45 41 43 In 2004 the average income of someone in the poorest quintile was 26.2% of someone in the richest quintile, by 2009 this was 22.9% and by 2011 it was 22.0%. Although almost all categories of income decline for the poorest quintile in 2009-2011 the largest impact is from the decline in social transfers. As ever there are data and compositional issues but this is still a fairly consistent and dangerous pattern. sorry about the formatting above – I think you can just about get the idea Lies, damn lies and statistics. I know the report is written on behalf of the elderly but still that does not excuse lazy incompetent journalism. We all know in journalism its the headlines that matter most. Here is one from breaking news.ie “Almost 10% of elderly live on breadline CSO report shows” The fact the figure is 18.8% for children is not in the headline. Independent.ie “Older people at risk of poverty” True, about half that of children. Here is one from RTE “Incomes for over 65’s fell by 5%” The fact that it states in the report that incomes have fallen by an average of 6% for everyone else is not mentioned. Who is at fault here? is it the journalists or is it CSO? It was the CSO that used 2009 as the baseline year. This was the year that the astonishing 48% income growth over 5 years ended. 2 years after the the financial crash the rate of social transfers to those over 65 was still increasing. This compared with a 19% growth for the general population. The two headline figures RTE led with were 1. Income for over 65’s down 5% from 2009 till 2011. However income levels fell 5.2% for the general population over the same period as per the report but this was not mentioned. 2. The consistent poverty rate almost doubled from 1.1 to 1.9 between 2009 and 2011. The fact the consistent poverty rate for over 65s was 3.9% in 2004 was not mentioned. Nor was the fact that the rate of consistent poverty was 6.8% for 18-64’s and 9.3% for children. Here is what the the news headlines from this report should have said. Enforced deprivation rates for children now 3 times higher (32%) than for those over 65 (11%). In 2004 it was less than double 10% v 18% It is hard to imagine how the reporting of a CSO report could be more misleading and damaging to the children of Ireland. Shame on all the media and if the writers of the silc report gave them a bum steer in a press briefing document shame on them too. This report was linked to the kite flying about lowering the state pension on RTE. Sean As you say there are compositional issues, especially the issue that these quintiles do not refer to cohorts of the same people tracked over time. The relatively large drop in the income of those in the lowest quintile would reflect the increased proportion of them who are now unemployed compared withe the situation in 2009. Peter That could be true, except that it looks like very little of the change in income is due to loss of earnings (looking at Table 8). Does anyone know if we have similar information about energy use in Ireland? OK, to keep it on topic, do we know if older people are using less electricity these days? http://www.theguardian.com/business/2013/aug/16/household-energy-use-falls Info like this tells you a lot about what’s really happening in an economy (and I don’t buy the fluff about efficiency measures kicking in). @Sarah Carey “Then the Pr’s flew in…..” I thought we floated in….. and spread our magic fairy dust around 🙂 How’s your summer going? Table 1 Composition of the elderly population by age group shows odd jumos year by year e.g, 65-69 increasing from 30.0% to 34.7% of the “elderly” between 2010 and 2011. 70-75 dropped from 27.9% to 23.1%. A remarkable change in a single year. The 2011 Census puts the proportion of 65-69 at 32.4% and 70-74 at 24.5%. I would expect more consistency. The footnote on page 1 of the CSO document refers readers to the general SILC report of 13 February 2013 which states that “The results previously published for 2010 have been amended following extensive investigation of anomalies in the data”. Such compositional issues are an inherent difficulty when interpreting figures such as these. There could be a group who in 2010 had ‘lower’ social transfers and ‘higher’ market earnings with gross incomes that put them in quintile 2 or above. In 2011 a loss of market earnings could result in them being in quintile 1 even with no reduction in social transfers. And now as quintile 1 is more heavily populated with people who have ‘lower’ social transfers the average social transfers for quintile 1 falls. The increase in earnings in quintile 1 (from 2.9% of gross income for those in quintile 1 in 2010 to 8.5% of gross income in the equivalent group in 2011) is possibly indicative of a compositional change with more people dependent on market earnings comprises quintile 1 in 2011. Average weekly market earnings in quintile 1 rose from €5.80 in 2010 to €15.82 in 2011. The percentage of gross income in quintiles 2 and 3 derived from market earnings fell in 2011. This fall may be a result of people more dependent on market earnings falling into quintile 1 due to lower market earnings. Of course, the reality is we simply don’t know from the figures presented. For the sample as a whole average weekly social transfers fell 0.9% in 2011. The 10.7% drop in the average weekly social transfers for quintile 1 does not appear to be solely the result of reduced transfer payments. @PR guy are you moonlighting….as ‘jacky’-i can confirm this and much worse! “In the US, older people are often referred to as “greedy geezers” because they are seen as taking more than their fair share of social welfare benefits. ” Jacky from the HSE or xHSE not sure,on Tuesday paving the road,laying it on a bit here thick here luv…..would you ever go way out … “In fact, older people were “almost universally perceived as a deserving group that merited more and improved transfers and services from the State”. http://www.irishtimes.com/life-and-style/health-family/second-opinion-ageism-develops-a-nasty-twist-1.1491841 @Sarah any chance of another letter in the IT…..i liked it…. an issue which has been bothering me about this, which may be a compositional issue as well, is how the level of social transfers is higher in 2011 in the top quintile than any other, even the bottom, in absolute terms: €314.44 p/w, compared to €158.69 for Quintile 1 and ~€270 for the others. That the quintile least dependent on social transfers (37.3%) receives the most in absolute terms seems strikingly unfair, unless the income quintile is reflecting a group, or part of a group, that is receiving large social transfers for specific reasons (e.g. disability, caring) but even then it seems unlikely that it should put them in the highest income quintile overall. I’d be interested to know if universal (or near-universal) benefits like free travel, medical cards etc. are included in these ‘social transfers’ alongside the state pension. Even accounting for composition it seems problematic that the highest income quintile receives so much, when in theory they should be receiving very little (at least in terms of the state pension). By contrast in 2004 the top quintile received the second lowest level of social transfers (the bottom quintile received the lowest, which is understandable as function of them having the lowest income, although it surely indicates – then and now – failures of the transfer system), and also were the only group to receive more income from earnings than social transfers (unlike in 2011). As a support for the disability thesis I also note the sharp decline between 2004-2011 in at risk of poverty rates for both those with ‘Bad/Very bad’ health and ‘Not at work due to illness/disability’ although the latter especially is a very small group. The at risk of poverty rate is directly linked to income (although as a side note, I must look up what the change in median income was between the two years, as changing income distribution can affect relative poverty both negatively and positively) Interesting statistics, although the big eye-opener for me was the reliance of social transfers – the patterns within that are what I’m curious about. Deprivation rates of both 0-17 and midlife have almost doubled over the period; for the elderly those with a disability gain least [h/t Blind Biddy]; unsurprisingly, % [as distinct for real] of social transfers increasing; overall: elderly maintaining deserved gains. Overall II: Ireland is a bad place to be if poor and a kid …. @Seamus Coffey Ta for link; very informative. @John. Thank you 🙂 When the spirit moves me, it’s hard not to press “send”. @PR Guy Carpet bombing more like 😉 Summer is going remarkably well if very busy. I’m hoping to cycle some of the greenway around Mulranny next week en famille. In my fantasies it is sunny and with baby carriage behind me, we sail along, feeling liberated and exhilarated. In reality, if anyone comes across a wizened female sobbing over rebellious children and despairing Dad, in the rain, halfway between Newport and Achill, that’ll be us 🙂 @Sarah Are you now adding the elderly to the unemployed and the disenfranchised emigrants to your hit list? I heard a rumour that your were back doin the neu project maths&stats in the leaving cert again_ how did you get on this time? hint: how much is 5% of f€ck all? fyi off thread on a slightly elderly lady! Merkel 3.0: Stasis You Can Believe In A Commentary by Almut Möller Germans love Angela Merkel, first and foremost because she asks little of them. It is a strategy she will be likely to continue following should she return to the Chancellery for a third term. But it is also one that has blinded Germany to the dangers facing Europe. Even as Berlin is at the heart of a drama which still has the potential to tear the euro zone apart, the city is oddly detached. The euro is absent from the debate. Instead, the campaign ahead of the Sept. 22 general election has focused on US intelligence surveillance, the rising cost of energy, childcare facilities and Defense Ministry bumbling. And that is about it. http://www.spiegel.de/international/germany/merkel-leadership-style-will-remain-unchanged-by-reelection-a-917003.html#ref=nl-international No comment! @DoD The unemployed are not on my hit list. I do have a hit list, but I don’t want to lose the element of surprise, so I won’t share just yet. counterpoint: The Merkel government demands southern countries make far-reaching reforms, but denies responsibility for the consequences of the crisis. It is a harmful attitude for Europe as Germany prepares for its legislative elections, warns philosopher Jürgen Habermas. http://www.presseurop.eu/en/content/article/4054711-sleeping-beauty?xtor=RSS-9 Well worth a read @Sarah Me loves surprises! Sarah: To complete your collection of interpretations of the CSO report, here’s Stephen Collins in this morning’s IT: “Detailed figures released by the Central Statistics Office on Thursday showed that the elderly have suffered considerably less in financial terms from the recession than any other age group. They confirmed once again that younger people have borne the brunt of the recession and that the elderly have been largely protected.” PS. Enjoy the Mayo Greenway. Don’t be put off by the high price of bike rentals and the rough unfinished surface. Ireland needs more of these amenities for a fast-growing area of tourism – hopefully the Galway – Clifden route will be next, but don’t hold your breath. Of course even if the composition changes, it doesn’t change the inequality – just our understanding of the dynamics behind it. Averages can mask what’s ahead for some older people. At over 40%, the number of owner-occupied dwellings without a mortgage is high for Western Europe. Meanwhile, private sector occupational pension coverage in common with the UK, is among the worst in Western Europe. Ireland’s State pension is less than a third of the average national wage and the economy is back to a situation where an unemployed person from middle age, if with some skill can trya struggle with freelancing/ ‘consultancy’ while those without, have a low chance of getting an job. I’m an optimist but not among delusionists expecting ‘rocket’ growth. @ S Carey Gene Kerrigan on your ‘hit-list’? @Vinny. Ah c’mon. Blatant fishing exercises like that cannot be indulged 🙂 @Peter My pal John Mulligan is trying for Collooney-Claremorris but the county councillors down there are holding out for the re-opening of the railway. Perhaps the transport economists here would set them straight on its lack of viability. Still don’t know if I’m going yet. Awaiting sign-off from some work projects. Fingers crossed! http://www.johnmulligan.net/page4.htm update: sur le slightly damp greenway studying the multiplier effect. Generally speaking states are unable to support state pension rates floors of more than 1/3 of the average wage in industry. Anything more than that has to be based on voluntary contributions. The state can effectively run a voluntary (on top of the mandatory scheme) contributions pension scheme with a management levy of 0.25% largely due to efficiencies in collecting/managing/distributing the funds. As we all know how gov’ts treat the over 70s’ and under 18s’ is measure of how civilised a country is. I recall seeing at 7:45 every morning over a hundred people under 30 lined up at an unemployment office that opened at 9. On the suburban commuter was a clearly over 70 man talking to himself about the hard day ahead of him at work. I thought about the problem of getting old people to retire in a recession so as the people who are collatateral damage can get back to work. One of the least damaging ways is the carrot of a half decent pension. http://www.independent.ie/opinion/columnists/shane-ross/elderly-teed-up-for-budget-sting-29525623.html What a disgusting article. Defending the indefensible just because they are your constituents. I would suggest he take a look at the spending patterns by those over 40 in Petra Garlachs recent work. People over 40 are still spending the same amount in the economy as they did in 2007. All of the reduction in consumption has come from those under 40. There may be some Stella’s but they are small in number. Hi Eamon You might like to listen back to the show on Saturday http://newstalk.ie/player/listen_back/launch and go to Aug 24th. My blog is here (it’s just a quickie, nothing of major substance). http://newstalk.ie/OAPs-taking-too-much-of-the-pie I had your IT article to hand… How do we get in touch with you if you want to contribute? Comments are closed.