September 26, 2008
Pensioners Face Postcode Lottery
Along life is a blessing. But for pensioners who buy an annuity with their pension pot, it can now also be a curse. The postcode lottery, which already determines the level of healthcare you can expect, the standard of schooling your children or grandchildren receive and the quality of local services you enjoy, now applies to pensions as well.
Norwich Union has become the latest pension provider to apply full postcodes to people who buy an annuity. The postcode determines what they will receive each year, depending on how long they are expected to live, based on their postcode.
Quite apart from the fact that a postcode is a very unsatisfactory way of gauging an individual's longevity, the system works against people in supposedly affluent areas like the Westcountry, where lifespans are longer but costs are higher too.
So pensioners in our part of the world - where water bills are the highest in Britain, transport costs are generally greater than elsewhere and housing is expensive - are expected to survive on less than retired people with exactly the same investment to make elsewhere.
From the point of view of pension providers, it might make sense. They cut back on annual payments in areas of general longevity because they know they will be paying out for longer. But for the individual, it looks as if they are being penalised simply because of where they live.
The people of the South West - and particularly those like pensioners who are on fixed incomes - already get penalised because of their locale. To add to that burden through a reduced pension is simply unfair. Even if 70 per cent will be better off using this formula, as Norwich Union claims, the 30 per cent who won't have real cause for complaint.
Perhaps those people who will be hit the hardest under this system are, as the pension providers claim, more sophisticated at handling their investments and will thus be better off anyway. But this is punishing them for working hard enough to be able to afford to live in a good area. How can that be justified?
The current economic crisis has caused enough distress on its own without penalising pensioners further. The fact that there are more winners than losers is no consolation to those who will lose out. The playing field needs to be level if the credibility of annuities and the companies that sell them is to be maintained.
Keep care local
THE anger that greeted yesterday's decision to shift some cancer services out of Cornwall and across the Tamar to Derriford Hospital, Plymouth, illustrates that bald statistics are not the be-all and end-all when it comes to health care.
An NHS review may have concluded that death rates for patients with throat and neck cancer are higher at the Royal Cornwall Hospital than elsewhere and that "too few" operations are carried out to deliver the best service.
But patients are not daft. And they can see that, statistically speaking, the figures are open to interpretation and to conclude that - on balance - they would rather have local services close to people's homes than face a journey to Plymouth to have an operation that could be performed in Truro.
Why don't their preferences count for more? Clinicians agree that a number of factors can influence death rates, morbidity and the chances of recovery, not least the age and health of the patients themselves before they start treatment.
And what's to say this shift of patient services out of Cornwall won't be the thin end of the wedge, with others following across the Tamar in due course, because the "statistics" suggest it would be better for patient outcomes?
Many people in Cornwall value local services for the simple reason that travelling a long way for a hospital visit can itself be debilitating and affect recovery after surgery. Putting patients miles from family and friends is seldom a good idea.
Cornish people have a long and proud tradition of fighting to keep their unique Cornish services. It would be a travesty if they lost this battle when public opinion says they should win it.
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