Pensioners 'face big inflation problems'

22/04/2009

Britain's retirees are still facing high prices despite falls in inflation figures, it has been claimed.

The government released new figures for March yesterday - showing that the Consumer Price Index had dropped from 3.2 to 2.9 per cent as price increases for food and fuel eased.

Meanwhile the Retail Price Index, which includes property prices, dropped below zero to -0.4 per cent, the first time this has happened since 1960.

However, separate reports suggested that, despite these declines, pensioners were still being hit hard by inflation.

Figures from the Daily Telegraph and Capital Economics showed that over-65s faced an actual retail price increase of 12.6 per cent.

Charities Age Concern and Help the Aged also said yesterday that the "real" rate of pensioner inflation was far higher than average.

Pensions themselves are also likely to be squeezed over the next year, as the state pension is directly linked to RPI.

The Daily Telegraph also reported that payments could go up by no more than £2.40 a week for next year as a result of the inflation trends.

Michelle Mitchell, charity director of Help the Aged and Age Concern, added: "Falling headline inflation masks the fact that that many older people's real rate of inflation remains far higher than the average.

"Most older people aren't benefiting from falling mortgage interest rates which are driving down inflation and are still struggling with high food and fuel bills."

Tags; Budgeting Advice, Recent Graduate Debt,

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