‘The real problem lies in the growing wealth gap, rather than the age gap alone...’
IF YOU wanted to divide the generations even more than they already are, you’d be hard-pressed to think up a more cunning plan than to give every 25-year-old £10,000 and make the olds pay for it.
The latest wheeze in the soap opera relationship between old and young, which began with creation and reached fever pitch with soaring house prices and crippling university tuition fees, comes from the influential Resolution Foundation Intergenerational Commission.
As a headline grabber you have to give it to them. As a plan you have to hope it will be buried.
Young people don’t need hand-outs; they need a fair and level playing field where education is affordable, jobs are available and buying a home is within their grasp, rather than the distant and unaffordable dream it now is for so many.
The commission suggests giving millennials £10,000 each and making pensioners who continue to work pay National Insurance to fund a £2.3bn windfall for the NHS.
Social care services should receive the same amount funded through a property tax, the commission, which consists of peers, business leaders and policy experts, suggests.
These experts suggest 25-yearolds could use the £10,000 to get on the property ladder, pay for education, set up a business and invest in pensions.
But what about the 26-yearolds and above, many of whom are still young and affected by exactly the same things? Wouldn’t you just hate to turn 26 the day before this all kicks in?
Commission executive chairman Lord Willetts, a Conservative former minister, agrees the recommendations are “not easy or comfortable” but said many no longer believe Britain’s young and old are being treated fairly.
But is handing out £10,000 to one group of young people fair?
It smacks of the sort of idea well-off people come up with because it’s either what they could afford to give their children, or what they received themselves from their parents when they hit some magical age.
The problem is that a state hand-out does not come with the care and support that family help comes with.
No disrespect to anyone, but if I had been given £10,000 from the government (or anyone) aged 25, I can’t guarantee I would have used all of it wisely. I am sure many young people would, but not all.
In increasingly divisive times it would be understandable if some young people blew the lot on holidays, fast cars and clothes. Easy come. Easy go. Instead of issuing hand-outs, why not come up with a more creative way to pay for the higher education that is now demanded for virtually any job with a reasonably decent wage?
Why not beef up funding for apprenticeships? And while those in power are at it they can build more affordable homes.
As for older people – not all are well off.
Many may well have enjoyed cheaper housing and free education, but not all. Pensioner poverty is a fact for some.
Lord Willetts is right when he says “many people no longer believe that Britain is delivering on its obligations to young and old”. But are the commission’s recommendations the way to mend that?
The commission, which was co-chaired by the peer alongside Frances O’Grady, TUC general secretary, and Carolyn Fairbairn, CBI director-general, recommended an “NHS levy” funded by national insurance on the earnings of workers over the state pension age, as well as on some occupational pension income.
That is a good and a bad idea. Older people, in general, use the NHS more and some carry on working through choice beyond pension age in a world where jobs are scarce for the young.
On the other hand some estimates say only one in 10 pensioners continues working past state pension age, and are not all well-off.
Some older workers have to keep working because they don’t have good pensions and need to work to make ends meet.
The real problem lies in the growing wealth gap, rather than the age gap alone.
A healthy and growing economy surely relies on the premise that each generation will be better off than the last.
Our young people are predicted to be the first generation since World War II to become worse off than their parents.
You won’t sort that out by handing all 25-year-olds 10 grand.