Frank Field on universal pensions

The British politician Frank Field, on the 70th anniversary of the famous Beveridge report that established a welfare state in his country, expressed very clearly my own views regarding the important but limited role of government in provision of old age pensions: there should be a universal pension for everyone of pensionable age, financed from general government revenue, regardless of the income or wealth of a beneficiary. Everyone is free to supplement this basic pension with his or her own savings, or wages from working beyond the official state retirement age.

This system, though simple, is rarely put into practice.

We need national schemes to ensure that, whatever the level of benefit they may be receiving, claimants can again begin to build on their own provision without being penalised or having to disguise what they are doing. These schemes must promote work, saving, caring and honesty.

Any new scheme must make the important distinction between when savings and when insurance will provide the best cover against loss of income. Almost all of us will retire, and we need to have saved so that we have an additional claim on future national income. Savings for individuals can be risky, but all of us have an interest in not financing means-tested welfare. The risk in gaining a minimum adequate state pension should be shared. The risks of an additional pension above the state minimum should be shouldered by the individual.

Frank Field, “From the cradle to the grave“, New Statesman, America edition, 29 November 2012.

British MP Frank Field was born in 1942, the second of three sons of working-class Conservatives “who believed in character and pulling oneself up by one’s own bootstraps”. He joined the Conservative Party in his youth, but soon switched to the Labour Party, and later became an Independent member of Parliament. He is author of many publications, with a special interest in poverty.



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