“In previous decades, young people could look forward to enjoying a more prosperous future than their parents, as they had benefitted from greater fortune than the generation before. It became a truism that each generation would be better off than the last. But for a variety of reasons that steady growth in incomes has been replaced by stagnation, with those born in more recent decades often less well off than their parents were at the same age.
“However those concerned that the intergenerational social contract is under threat will not be reassured by the party manifestos which, as this analysis shows, continue to play to power of the grey vote at the neglect of the youth one.
“Given the rises in life expectancy, the cost of the state pension is only going to go one way. Therefore Labour’s plan to scrap rises to the state pension age will increase the burden on the deceasing number of working age people. Similarly, significant provisions would be needed to be set aside to fund promises made by both Labour and the Liberal Democrats to work with the Waspi women in order to compensate them for their issues, challenging the policy objective for responding to increased life expectancy.
“With all the main parties pledging to retain the triple lock could prove unsustainable in the long run and the bill will be picked up by the upcoming generations. Given the costs associated, perhaps it is unsurprising to see intergenerational experts worried about the impact on future generations.
“Away from pension policy, Labour has also pledged to scrap the inheritance tax residence nil rate band. While this is a complex allowance, scrapping it altogether will stem the flow of wealth between the generations and fail to address the increasing issue of intergenerational fairness.
“What is clear from the main parties is that they haven’t necessarily grasped the problem facing younger generations when it comes to pensions and tax. There will come a time when innovation is needed in this space and the sooner that begins the better the outcome.”
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