Battle of the generations

Are the young bearing the burden of the deficit? Should the older generation bail them out?

Baby-boomers must pay up

Daniel Knowles


The baby-boomer generation is the most cosseted, untouchable, powerful generation in our history. To say so isn’t pensioner-bashing, but simply stating a fact. That is the lesson of the outcry over last week’s ‘granny tax’ in George Osborne’s Budget. Even as those in every other generation have seen their incomes fall, and had to consume less, the elderly have been completely protected from Osborne’s axe. Yet when the Chancellor decides to close a tax loophole which fewer than half of those eligible even use, it is denounced by the pensioner lobby as an ‘outrageous assault’. It seems to be the received wisdom that pensioners are a group too powerful for any sane Chancellor to confront. Osborne stands accused of a grave blunder.

Perhaps, tactically, it was. But behind the headlines, the truth is that whatever the individual circumstances of particular pensioners, those in their late fifties and sixties — the baby-boomer generation — are on average better off than they ever have been. They have enjoyed benefits that my generation can only dream of: free university education, greater equality of opportunity — state-school graduates dominated Oxford and Cambridge — affordable houses and a gilded retirement from final salary pension schemes. The Institute for Fiscal Studies has found that pensioners lost far less under the government’s austerity drive than any other group — despite the fact that ‘over the past decade and more, pensioner incomes have risen faster than those of the working-age population’.

Granny is not being robbed to pay down the deficit; she still has her winter fuel payment and her free bus pass. Instead, the bulk of the burden is being borne by mummy; young families are losing the most by far.