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Joe Armitage: The Chancellor needs to address the inter-generational inequality the gilded baby boomers will soon cause

Armitage Joe

Joe Armitage is Chairman of Medway Conservative Future and Deputy Chairman (Political), Rochester East Conservatives.

Us youthful blighters face exorbitant university fees, a property ladder too arduous to climb, and a family too expensive to have. Meanwhile, the gilded baby boomer generation fret about the interest rates on their bundles of cash, keep a close eye on the Teletext share index and swan off on cruises around the world.

Inter-generational inequality is stark. Of the UK’s £6.7 trillion total wealth tied up in housing, pensions and liquid assets, a staggering 52% belongs to those aged 45-65 – the baby boomers. Never again will such a large cohort be able to accumulate so much wealth on the back of mass inflation and such a drastic increase in life expectancy. The state cost of looking after these generations is enormous; Treasury projections indicate 25% of our GDP will be spent on education, health and social care by 2050, an increase of almost 5% from the current 20.1%. The question is, should us younger people have to foot the bill for a generation that had it so much better than we will and if not, what are the solutions to such a massive problem politicians seem to avoid like the plague.

One of the answers needn’t involve taxing us younger generations and is something conservatives cherish: the family. Most cultures outside Britain believe if you care for your children when they are young, they will care for you when you are old. Unfortunately, inter-generational interaction in the UK is lamentable: 42% of people agree there are not enough opportunities for younger people to meet and work together; this compares with just 24% for Spain and 26% for Germany.

The Conservative Party hypes the Big Society, and what is more altruistic than moving in with your parents? Although the concept is alien to most of us, it’s very popular abroad. The average household size in Britain is one of the lowest in the world at 2.4, but it shouldn’t be, as different generations living together would be cohesive and provide many benefits to society. Firstly, houses would be freed up, helping solve our property shortage. Also, with the cost of property so high, parents can help towards the cost if the laws around doing such a thing were relaxed. Secondly, the cost of childcare, which, for some parents accounts for 25% of their income, could be alleviated if grandma stepped up. Lastly, it would relieve the state of the extortionate care home costs. Not only do elderly people find care homes humiliating, but there is evidence to suggest their condition deteriorates when admitted. A visiting nurse, if necessary, can supplement the security of a family, which is drastically cheaper than care homes. Tax breaks could encourage families to do this, like discounting council tax or waiving inheritance tax.

Us younger generations must also realise successive generational life improvement is over. The standard of life enjoyed by the baby boomers was a one off - we cannot match it. The days of a holiday every year, the nicest foods and a new car every few years are gone. We are going to have to revert back to the days our grandparents are all too keen to lecture us about: the days of scrimping and scraping, saving for that all-important deposit on a house, recycling clothes and making do with what you have. Life back then was about working to live. Nowadays, however, it seems an annual holiday abroad is as important as putting food on the table. We will have to adjust our definition of social justice, with India, China and other BRIC countries, it is impossible for Britain to remain competitive with such high standards of living.

The 2012 Budget has recognised inter-generational inequality to an extent, by equalising the personal allowance for pensioners with an income. The Chancellor ought to go further however, the thought of pensioners with multi-million pound assets receiving a £200 Winter Fuel Allowance is distasteful to most younger generations who have to stump up £100 for a tank of fuel to get to work. No Chancellor, however, would be brave enough to tackle the inter-generational inequality because of the influence of the grey vote.


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