10p compensation is "too little, too late" for pensioners

Britain's biggest pensioner organisation, the National Pensioners Convention (NPC), has today criticised the Chancellor's proposed package of compensation for those aged under 65, as "too little, too late" to win back the support of older voters.

Joe Harris, NPC general secretary said: "Under the old system, a pensioner aged 60-64 with an income of £10,000 a year would have had an annual tax bill of £782. Even with Mr Darling's extra £600, the same pensioner will pay £793 in tax - still leaving them £11 worse off. This panic measure is too little too late and won't be enough to win back the trust and support of Britain's older voters. That can only come when the government agrees to raise the basic state pension substantially and restore its link with earnings."


TAX RATES FOR AGE 60-64

2007/08 £5225 Personal Allowance Tax Free
£2230 Tax at 10% £223
£2545 Tax at 22% £559.90
Totals £10,000 £782.90 Tax

2008/09 £6035 Personal Allowance Tax Free
£3965 Tax at 20% £793
Totals £10,000 £793 Tax