'We worked so damned hard...’

David Elkins: It must be awful for people retiring now Photo: ANDREW CROWLEY

By the standards of many British pensioners, Judith and Gordon Hill are not poor. “Comfortable” is the word they use. It means they have some money to spend on the luxuries of modern life and that they are not a burden on their children.

Until recently, the Hills, who live in High Wycombe and who both retired in 2002, were able to fund a couple of holidays or short breaks a year from the interest on their savings in bank accounts and ISAs. Nothing too grand – a week in Greece and two weekends away in Britain, say.

Everyday expenses were met from their state pensions and Mr Hill’s two occupational pensions, which are not final salary. But in the past few months, that cosy arrangement has come to a sudden and disquieting end. The couple are caught up in a silent crisis that is hidden from most of the population because of the people it affects: the elderly.

Falls in interest rates are routinely trumpeted as good things, and never more so than now, with the economy near to stalling. Mortgage payments fall and with them the threat of default and repossession. Credit, the lubricant of the economy, becomes cheaper. With Christmas around the corner, people should feel encouraged to spend because locking money up in a bank serves little purpose.