‘Silent Generation’ who get least out of the welfare state
PENSIONERS born before the Second World War are the biggest ‘losers’ from Britain’s welfare system, according to a report.
Successive generations have received more from the welfare system than they paid in taxes, but the so- called ‘silent generation’ – born between 1916 and 1945 – are on course to fare far worse than their children, grandchildren and great-grandchildren.
Those in their 90s will receive just 5 per cent more from the State in the form of education, health, social security and pensions than they pay in taxes. This is largely because many of them started paying tax just as the welfare state was created, under Clement Atlee’s Labour government at the end of the war. This included the creation of the National Health Service in 1948.
Those born between 1936 and 1940 started to reach working age in the mid-1950s, meaning they helped to pay for more generous education provision than they received, as well as paying higher taxes to fund the pensions and health care of older generations.
According to the report by the Resolution Foundation thinktank, these two factors ‘almost entirely offset the more generous pension and health provision the silent generation experience themselves.’ Their children, in stark contrast, have had a much better deal.
Baby boomers born after the war have been the biggest beneficiaries from the welfare state, and are set to receive over 20 per cent more in support than they will have contributed in taxes over their lives.
Unlike their parents, being born between 1946 and 1965 means they have spent their entire lives with the modern welfare state. So although they have made much greater contributions in taxes during their working life, they are also set to be a huge burden on the welfare
‘Let down by the system’
state in retirement. The report concluded: ‘The baby boomers have been the winners and the silent generation the losers from generational burden sharing as the welfare state has expanded and matured.’
The silent generation is socalled because its members tended to stick to the rules and work hard instead of speaking out to bring about social change. The term was coined by Time magazine in 1951.
Last night former pensions minister Baroness Altmann said the findings highlighted that the ‘most elderly and vulnerable people in society are not being taken care of’. She added: ‘This shows that we should stop putting all pensioners in the same bracket as baby boomers.
‘Many men in this generation would have fought in the war and many women would have volunteered. Yet these people are being let down by the welfare system.’
But the prospects for younger generations are also ‘uncertain’, according to the report.
It warned that the pressure on welfare spending will grow sharply from the early 2020s as ‘Britain’s large baby boomer population hits retirement’.
The report described this situation as ‘unsustainable’, arguing that either taxes will have to rise dramatically to pay for it or the welfare state will have to be cut back drastically.
David Finch, of the Resolution Foundation, said: ‘Pressures will begin to mount in the coming years as our large baby boomer cohort retires and starts to consume rather than contribute to the welfare bill. Those costs need to be addressed without placing the contract between generations at risk.
‘We therefore need to think creatively about how we fund our welfare state in the future, rather than simply returning to the well-trodden responses of raising taxes on working people, or cutting funding to schools, social security and the NHS.’
The findings emerge as Prime Minister Theresa May faces pressure from Labour and her own party – led by Foreign Secretary Boris Johnson – to increase funding for the NHS.