Baby boom retirees ‘can benefit communities despite spiralling cost of care’

A report from the Resolution Foundation challenges the conventional belief that encouraging older people to move to an area in increasing numbers will necessarily burden council budgets with the increased cost of caring for them.

The issue has been a hot potato in the county’s most deeply rural areas, many of whose villages have become retirement havens for former town and city dwellers.

But the foundation says that older people often now have greater spending power than those of working age, and that the value of the “pensioner pound” can help to keep alive struggling economies.

Its chief executive, Torsten Bell, said: “If you go back 20 years, pensioners were much poorer. Now they have the same average income as the working age population.”

‘Tipping point’ warning as social care costs spiral across Yorkshire

He also said the age profile of an area did not necessarily define its wealth.

“Not everywhere that’s younger is doing well. There are poor young places as well as rich ones.” Cities such as York could particularly benefit from “rich baby boomers” – people born after the Second World War who had now moved into retirement, Mr Bell added.

York City Council heard earlier this month that the area had been a “victim of its own success”, having attracted buyers from outside the region to fill nearly half the £375,000 flats in a new retirement block at Bishophill.

But Mr Bell said: “York should be a bit careful because one of the reasons they’re doing so well is that some of its older people, and those who have been able to move there, have had a higher income growth recently.

“There’s a reason why a lot of shops in York are still open when other high streets are struggling. The pensioner pound is quite important in those areas, which don’t have a lot of other industries but are able to attract people who spend their money there.

“People talk too often abut older being just an economic challenge. Clearly they do bring costs of pensions and social care, but for many people it’s a great phase of their lives, and for some places it also brings economic opportunities.

“If you can attract better-off pensioners who spend their money locally, it can help support your working-age population.

“As an economic strategy, people will want to hold on to their existing higher-income boomers or make sure that they bringing in are new ones to spend money locally.”

Carl Les, leader of North Yorkshire County Council, said he recognised the attraction of the county to retirees and that to discourage them from migrating there would be wrong.

“I can understand how somebody who has lived all their life in a city might want to come to one of the quieter parts of the country,” he said.

“And of course they have the advantage that the property they’re disposing of in the city is probably of considerably higher value than the one they’re going to move to.”

But he said their purchasing power also created “a squeeze – not only on house prices because young people can no longer afford them, but also on social care costs”.

Prof Yvonne Birks, from the social policy research unit at the University of York, warned that pensioners themselves had often not taken into account the likely costs of their own care.

She said: “Particularly within the group who are perceived as well-off, people think about pensions but they don’t think about what will happen if they need to care for someone or be cared for.

“What people don’t understand is that social care is not the same as the NHS – it’s not free at the point of need. There is a series of assessments and people often have to pay for their own social care. People don’t really appreciate the cost of that.

“If you go into a care home, the cost can be over £1,000 a week, depending on where you are. Or you might need care at home, at £25 an hour, and even if you have modest savings, you can crack through them fairly quickly.

“When you run out of money, you become the responsibility of the local authority and that comes at a cost to them and therefore to the country.”

Prof Birks added: “In terms of national policy, you only really need to look at the current election to see that everyone’s talking about the NHS but no-one’s talking about social care costs.

“The issue has been kicked down the road for years and years, while other governments around the world are taking it on and creating insurance policies and other ways in which people might think about how to fund their future social care costs.

“It’s a problem that’s only going to get bigger, because people are living longer with more conditions and more frailty.

“Increasingly they will have to be looked after by their older children who will probably be in their 70s themselves.”

Prof Birks acknowledged that while many people looked forward to their retirement, few wanted to contemplate their demise.

“Everybody just assumes it won’t happen to them until it does happen. By then they have often already hit a crisis point, so their decision making isn’t always great,” she said.

• The age gap between communities is at its most profound in the Yorkshire Dales and other deeply rural parts of the county, where populations are growing old at up to twice the rate of the rest of the UK, according to recent figures.

The disparity is said to be most acute in the Richmondshire district, where the proportion of residents over 65 has risen by six per cent since 2001. The council there has adopted a package of measures to attract families and younger people to the area, to redress the balance.

But Carl Les, leader of North Yorkshire County Council, said it was not an isolated issue. “I’m not surprised at the Richmondshire figures, and I would imagine that Craven won’t be far behind. Scarborough and the coast, too,” he said.

In the countryside near Skipton, one company has found its own partial solution by offering new recruits their own home at a subsidised rate, while they settle in.

Peel Entertainment, a group of creative and technology companies, puts them up at a property near the 16th century Broughton Hall, where it has its headquarters. The surrounding estate hosts more than 50 firms in refurbished coach houses, barns and stable buildings.

The company’s managing director, Susannah Daley, said: “It’s quite a struggle to get young people to relocate to a rural area, and we really have to work hard at finding ways to do it.

“So we now have property for people to move into, to save them the worry of finding a home.”

She said a traditional hurdle to rural life among those used to a city was a reluctance to commit before having decided whether they liked the lifestyle.

“People didn’t want to buy or rent a home for six months or a year until they had tried out the job and the area,” she said.

“So now, if we offer someone a job, they get a room in the house. They pay for it at a subsidised rate and it gives them a chance to acclimatise to the area.

“If they like it, then some people do go on and buy or rent in the area.

“And that’s incredibly useful because too often young people leave and don’t come back until they’re in their 30s, when they become attracted to the good schools around Skipton.”