Young people's prospects have 'nose-dived' says report

 
Students in lecture Young people are financing richer, elderly people, argues the report

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Younger people in the UK are losing out financially and politically to older generations, a report claims.

The Intergenerational Fairness Index suggests the prospects of younger people have "nose-dived" since the start of the financial crisis in 2008.

The index uses official statistics to compare different generations' stakes in key areas from income and employment to housing, pensions and education.

Co-author Angus Hanton said the plight of younger generations was clear.

"The index shows that poorer young people are financing richer old people as our society grapples with demographic change and increasing longevity."

The authors, from the Intergenerational Foundation, co-founded by Mr Hanton, focus on nine indicators they believe most affect young people's lives and outlook - unemployment, income, housing, pensions, health, education, government debt, the environment and participation in democracy.

Their stated aim is to show "the degree to which younger people in our society are at an advantage or disadvantage" and how much "future generations will be impacted by the ways in which we live our lives today."

They used official data from 1990 to 2011, excluded the effects of inflation and population growth and compared how much different generations put in and what they will get out.

'Rapid deterioration'

They used the figures to create an aggregate of how the balance between the generations has changed over the past 20 years.

They say the situation worsened by 28 points between 2000 and 2011 with a particularly rapid deterioration since 2008.

Some measures showed an improvement. For example in 2010 a greater percentage of national income was spent on education than at any time since the mid 1970s - but the authors say the prospects for young people overall are poor.

The report states: "Whilst government borrowing and pension debt have increased steadily, there has also been an increased shift in favour of the older generation through higher charges for education, rising youth unemployment and high housing costs.

"This index highlights... the increasing problem of poorer young people financing richer older people."

The authors say recent government changes for example to the financing of higher education in England as likely to shift the balance further away from younger people.

Angus Hanton said: "They now face an average £42,000 of debt from university, the prospect of long-term unemployment, record rent demands and now the abolition of housing benefit."

He called for benefits to be cut fairly across the generations: "Let's talk about those benefits that go to everyone over 60 years of age, irrespective of wealth - winter fuel allowance, free bus passes and free prescriptions."

Paul Johnson director of the Institute for Fiscal Studies said: "The broad statement that young people have had it worse during the recession is true in all sorts of measures. Unemployment rates for the under-25s have risen steeply while this is not the case for the over-30s.

"The over-40s have been able to continue spending as before but the spending power of the under-30s has gone through the floor as their incomes have fallen and they try to save to buy houses.

"Poverty among the under-25s continues to rise with the poorest now no better off than their counterparts 40 years ago... the worst-affected have been those with low levels of education from poor backgrounds who are not going to be supported by the older generation."

Liam Burns, president of the National Union of Students said: "The issues affecting young people today already affect many poorer older people too.

"Pushing parents into poverty disproportionately impacts on the young people they care for and denying older generations access to education cuts the aspirational link that springboards their children to continue studying.

"Any intergenerational rebalancing needs to be underpinned by understanding rather than obscuring the huge and growing socio-economic inequalities in our society.

"We should be looking to find common cause across the generations, not advocating a race to the bottom where the poor, whether young or old, continue to lose out."

A government spokeswoman said: "We want every young person to have an excellent start in life. Education is the surest route out of poverty and our reforms mean that many more children will receive the world-class teaching they deserve.

"Tackling youth unemployment remains one of our key priorities. We have launched a £1bn youth contract which includes a wage incentive for employers to hire young people and an extra 250,000 work experience placements over the next three years.

"We are also helping young people improve their skills through pre-employment training by expanding the Apprenticeships programme."

 

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  • rate this
    -38

    Comment number 96.

    I'm 25 and my Girlfriends 21, we're both in fulltime employment. How we're expected to save £10,000+ for a mortgage is beyond me. We don't even run a car and it would take us 2-3 years to save for a deposit, and that would mean not going on holiday at all.

  • rate this
    +7

    Comment number 95.

    Older generations, with greater wealth than their parents, don't want their offspring to struggle in their youth as they did.They don't encourage them to help around the house, to get part time jobs at the weekend or, when older, to fend for themselves. Is it any wonder they then rely on the bank of mum & dad & fail to even get a foot on the job ladder, considering opportunities as beneath them!

  • rate this
    +8

    Comment number 94.

    Reading these comments I am shocked at the anger across the generations-like Liam Burns says-"We should be looking to find common cause across the generations"
    Maybe it is the focus on the pursuit of material wealth that has created all this resentment and jealousy, not the welfare state.

  • rate this
    +4

    Comment number 93.

    Cant they just put rail fares up? It's the usual response.

  • rate this
    +1

    Comment number 92.

    I am in my 60's but even I accept that our generation, though we may have worked hard, also enjoyed prosperity because of credit - we borrowed billions and our government borrowed billions for us - we deregulated the financial sector which caused this mess and now we are leaving it to young people to pay our debts - where is the honour in that? lets show some maturity and take responsibility.

  • rate this
    +10

    Comment number 91.

    Now in my mid-50's, with no children, having been earning money from my teenage years, and taxed to the hilt... just how are the young subsiding me?
    The youth of today have far more gadgets, mobiles, nightlife, laptops..... when I was young I spent spare time volunteering for my community (as well as working). It took me over 20 years to get on the housing ladder.

    Hard work = progression!

  • rate this
    +9

    Comment number 90.

    52. StevenM
    You're quite right. It is a about the state of the country & the mindset we have developed over the last decades. We beat ourselves up over the state of the world instead of concentrating on what is right for UK. We allow our politicians to play a divide & rule game with us, polarised as we are between Labour & Tory. Generations don't matter so much as getting back a belief in UK & us.

  • rate this
    +7

    Comment number 89.

    You have to laugh - this is the great left wing con!
    The left keep giving more money to welfare.
    The young are seduced by the left into thinking that this is the caring thing to do.
    The con? The young have to pay for it in later years.

  • rate this
    -9

    Comment number 88.

    46.chris newman
    "..Gordon Brown's ACTUALLY NON SOCIALIST raiding of ordinary peoples pension funds..."

    Last time I checked, Brown served as a Labour chancellor & PM. That's socialist enough for me.

  • rate this
    +2

    Comment number 87.

    Retirement is not the problem for youth unimployment its not retiring. By retiring younger more jobs are available for younger staff. It is better to have lots of retired people who already own property than itis to have unimployed young people on benefits who will never be able to afford to get onto the property ladder. Surely its better that young people earn the money and the older are given it

  • rate this
    +4

    Comment number 86.

    I have no doubt that our wonderful government will try to use this report to create Divide and Conquer divisions between young and old.

  • rate this
    +1

    Comment number 85.

    Pensioners need a wake up call - all their NI paid for is a share of future revenue from NI. All the actual money was spent payign their parents pensions and healthcare. Today we spend more on the NHS than the entire amount collected in NI. So no one is "paying" anything into state pension in reality. Why are new benefits (bus pass, winter fuel) now part of this paid up entitlement? They aren't.

  • rate this
    +2

    Comment number 84.

    The key problem is housing, and it over shadows the other more transient issues. A whole generation cannot get on the ladder (and are stuck renting) until their parents die, at which point the government take their slice. Its difficult to put down roots when you are paying someone else's mortgage.

  • rate this
    +4

    Comment number 83.

    The real bill the young will be paying is the ever escalating public sector pensions. These are funded out of annual tax revenue and not (except in a few cases) from pension pots. As life expectancy increases, so will the payouts. By the young. Out of their taxes. On top of their tuition fees and loans and mortgages they can barely afford. I am quite sympathetic.

  • rate this
    +1

    Comment number 82.

    My wife works in end of life care and the condition some of these people live out their later years in is desperate.

    Still, I suppose they shouldn't complain, look at all those young people roughing it with their high life expectancy, mobile society and expensive consumer electronics. They are the ones who have it really tough.

    Has anyone followed the IF link above? You should.

  • rate this
    +4

    Comment number 81.

    The free bus passes and winter heating allowances should never have had the starting age of 60 when people are using the bus pass to go to work in well paid jobs. However universal benefits are easier to administer than means testing. Why not just extend the age at which they are paid out! (from a pensioner)

  • rate this
    +1

    Comment number 80.

    Excuse me, but this is the Welfare State, and how it was established. The whole ethos was that it would be funded by those making contributions, for those who had made contributions in the past. Now, if the balance has shifted and placed too high a burden on the current contributors, let's reduce some of the extra benefits like those listed above. Let's not throw the baby out with the bath water.

  • rate this
    +3

    Comment number 79.

    Education important but many play truant, inc parents giving term time hols then blame teachers for lack of learning. The "right" of length of maternity leave for both parents plus this you can be sick on holiday & claim for it [ have a hangover,catch local bug etc not the bosses fault] will not encourage firms to employ. Older people more reliable,dont go sick, arrive late,go early work harder

  • rate this
    +3

    Comment number 78.

    I have lived in other countries and can make comparisons.
    This country has gone down the drain in my lifetime.
    OUR "Democracy is broken"
    "Capitalism" = legalised theft - does not work.
    OUR POLITICIANS AND THE "MONEY MEN" are to blame.
    I will help the young to change things.

  • rate this
    +7

    Comment number 77.

    In the main, older people have paid to run the country in the past: therefore, the country is obliged to repay that involuntary investment.

    To use the ridiculous suggestion that the old are taking money and opportunity from the young is a gross misrepresentation of the situation. If you buy a can of beans and are then accused of taking the food from the mouths of children is similarly stupid.

 

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