As Jeremy Hunt ushered in a new era of austerity, it seemed like nothing was immune to the chancellor’s axe. Taxes were to rise, spending on public services reduced, the energy price cap reined in. As the principle of ‘sound money’ reared its head once more, nothing was off the table in a desperate attempt to get spending under control.
Nothing, that is, apart from pensions. For the poor, children, and disabled, the treasury door was firmly shut; but just as he was taking food off the tables of the hungry, Hunt was busy lavishing riches upon the elderly. Not only is the pension ‘triple lock’ to remain in place – guaranteeing a 10% rise in pensions, year on year, costing the treasury tens, if not hundreds of billions – but the limit on pensions savings has been scrapped, costing the treasury a further £2.75 billion in the next five years.
This is despite the fact that are few groups in British society who need extra government help less than pensioners. A quarter of pensioners are millionaires, many more than are in poverty (indeed, poverty among pensioners is around half as common as among children); since 2010 pension funds have doubled, while wages have remained nearly static. Unlike millennials or generation Zers, ‘boomers’ also had the luxury of growing up in a world where nearly everyone could afford a house, and where one job was good enough for life.
Not only is investment in pensions at the cost of everything else unfair, however, it’s economically illiterate. Spending on education, childcare and infrastructure is an investment that guarantees a brighter, richer future; while pensions are of course necessary to prevent the old falling into poverty, increased spending on them offers no long-term economic benefits.
Pensions, however, are only one manifestation of a problem that runs throughout British political life. Virtually every single major political event over the past decade can only be understood with reference to the complete dominance of the elderly over the debate. Brexit, for instance, will be completely disastrous for young people: it will reduce long-term GDP by as much as 10%, while devastating academic research and reducing opportunities for immigration. For the old, however, Brexit means less immigrants and an easier time holding onto a nostalgic concept of British exceptionalism; the only real downside is a little more bureaucracy when going on holiday.
Time and time again, the interests of a youthful many have been neglected in favour of an elderly few. What the young need more than anything else is a growing economy; but for the old economic growth is difficult and disturbing – it means noisy construction projects, radical, worrying change and increased immigration – with most of them never to enjoy its positive effects. Almost every economically irrational decision taken by subsequent Tory governments – Brexit, the lack of spending on infrastructure, a refusal to reform planning laws – is in fact supremely rational when viewed through the lens of strengthening their elderly voting base.
It is clear, therefore, that British politics increasingly resembles a gerontocracy – rule by the old. What is less clear is how to fix it. The most important step is to increase voting turnout among the young. The reason government after government neglects the interest of anyone of working age is because, politically, it’s far less beneficial; in 2019, over 75 year olds had a turnout not far off twice that of 18-24 year olds. Also crucial is to give the old a stake in an expanding economy. The triple-lock, while a brilliant piece of rhetoric, is a misnomer; our current pension system instead resembles a skeleton key, wielded by the old to raid the country’s coffers at every opportunity. A solution first proposed by the Economist, so perfect as to practically be genius, is to link pension growth directly to economic growth. Many would’ve been more hesitant to opt for Brexit if it meant potentially seeing their pensions shrink by thousands of pounds.
British politics, therefore, is captive to a special interest group of doddling old grandmas and zimmer frame wielding grandads. Until this group’s undue influence is weeded out, Britain’s status will remain the same; a declining power, destined to end up as the ‘Sick Man of Europe’ once again.
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