Old Age Pension

In the later years of the nineteenth century there was considerable public debate about the need for the State to provide pensions in old age. Evidence# began to accumulate that old age was one of the prime causes of poverty. Joseph Chamberland was an advocate in the 1890’s of pensions for the aged. A member of the Royal Commission of 1893 on “Poor Law Relief and People Destitute from Old Age”, he gave extensive evidence to the Commission pointing out among other things that although pauperism was only 8% among those under 65 years, it was 25% among those over that age.

In 1899 the House of Commons appointed a select committee to report on “the best means of improving the conditions of the aged deserving poor”, it came down conclusively in favour of a non-contributory system of old age pensions. On 15th June 1908 Lloyd George# introduced the Old Age Pensions Bill he explained that the object was to exclude “loafers and wastrels” and to use the resources of the State “to make provision for undeserved poverty’#. This objective was to be accomplished through the application of a test of income rather than a test of destitution and would entail no abrogation of voting rights. The scheme was to be totally financed by the central exchequer, whereas the poor relief which had been granted previously had been provided from local funds.

The Old Age Pensions Act 1908# introduced the first State old age pension in the United Kingdom. Five shillings a week was paid to people aged 70 years or over, subject to a means and moral character test. It was designed to supplement and not as something that could be lived on. This was equivalent to 22%# of average earnings. In 1910 about 45% of persons over 70 years in England received the pension. In Scotland the figure was 54% and in Ireland 99%. The implementation of the Act in Ireland caused controversy# in England, as 4.1% of the Irish population were in receipt of pensions compared with 0.72% in England. The high level of Irish claimants was due to the distorted demographic structure arising from death and emigration following the Famine. The old age pension was a welcome addition to the low levels of income in Ireland.

The old age pension scheme was amended and modified by various subsequent acts, mainly by easing the limitations in regard to means, but its principle has remained unchanged. The maximum rate of pension was increased to 10 shillings# in 1919 and, except for the period 1924 to 1928 during which it was 9 shillings#, it remained at 10 shillings until 1948. The Blind Persons Act 1920 extended the pension to sightless people over 50 years subject to an assessment of their capability for work.