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Lord Willetts saying: We show pensioner incomes are £20 a week better off than working-age incomes The triple-lock guarantees that pensions rise by the same as average earnings, the consumer price index, or 2.5%, whichever is the highest. But the report from the Resolution Foundation was the first suggestion that the retired had actually overtaken the working-age group. The figures referred to the "typical pensioner household", by which it meant the median, which is the household for which half of pensioner households have higher income and half of them have lower incomes. In this case, a pensioner household is one in which at least one member is of pension age or older (65 for men, 64 for women) whether or not that person is working. There can also be working people in a pensioner household. But the important factor that has been mentioned little in the coverage is that the measure of income that the Resolution Foundation is using is one for income after housing costs have been paid. Image copyright Resolution Foundation Image caption This chart from the Resolution Foundation gives income after housing costs for the median pensioner and working household as well as a richer one and a poorer one. Taking income after housing costs makes a huge difference because pensioner households are more likely to own their own homes and to have relatively small or paid-off mortgages. The report says, for example, that 70% of the silent generation (born 1926-45) own their homes outright, while just over 40% of the baby boomers (1946-65) own theirs, with another 30% still having mortgages to pay.

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