Many pension holders could be struggling to make ends meet after a financing study revealed that older people have encountered inflation of more than three per cent for a over a year.
According to figures calculated by the Alliance Trust Research Centre, the average over-75 has seen increases in the cost of living stay above the three per cent threshold consistently since May 2006.
And last month, elderly inflation stood at 3.4 per cent, which is 36 per cent higher than the headline inflation rate monitored by the Bank of England before considering changes to the base rate.
This effectively means that a number of elderly people may have had to stretch their pensions further than ever to pay essential bills, according to Shona Dobie, head of the Alliance Trust Research Centre.
"In recent years, low income and elderly households have been forced to allocate their budgets to the goods and services which have experienced the highest price changes, leaving little disposable income left over," she said.
In March of this year, headline inflation hit 3.1 per cent.
Since this exceeded chancellor Gordon Brown's stated target of three per cent, Bank of England governor Mervyn King was forced to write a public letter explaining the reasons for the high rate of inflation.
High elderly inflation causing pension holders problems, research hints
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High elderly inflation causing pension holders problems, research hints
Fri, 15 Jun 2007
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