Fairness between the generations

Some commentators wish to stir a battle between the generations.

The young have their advocates, telling us the baby boomers now reaching retirement have done too well at the expense of others. They point to high house prices making it difficult for first time buyers, and high rents sometimes paid to buy to let landlords who may themselves be baby boomers.

Pensioner savers have their supporters, saying that they have been hard done by with ultra low interest rates and poor annuity rates on retirement thanks to quantitative easing and the low rates in the aftermath of the banking crash.

The truth is more mixed. Both generations have their advantages and their challenges in the current situation, and both have policy interventions designed to help them.

The younger generation has the benefit of much lower interest rates when they can find a house and a mortgage than their parents faced. They also now have the benefit of very low inflation, compared to the rates we were used to in the 1970s and early 1980s. The government has added its Help to Buy scheme, and is pressing ahead with ways of securing more new homes.

The older generation of savers have made money from the rise in asset values brought on by quantitative easing and the general economic policy. Those savers who bought property or shares or certain kinds of savings bond are likely to have decent capital gains today on what they bought in past years. The government has now added the National Savings Bonds with higher interest rates for those who do not want to risk their capital but need a better return than the 0.5% base rate.

There is another truth which the generation warriors ignore. Within most families one generation helps another. Much of the wealth of the baby boomers will be passed on to their children and grandchildren on death. Some of it is being passed on before death, as parents help children with home deposits or other large ticket items in their budgets. Just as some grandparents help with the household chores and childcare of their children, so some help with gifts of cash. The money which is not passed on will be taken in tax by the state. That money can then be spent on those most in need.

Conservatives have announced they will keep Pensioner bus passes, free tv licences for the over 75s,and winter heating allowances. Do you agree?


  1. Brian Taylor
    February 24, 2015

    Born in 1946 (baby boomer?) my father was a publican and helped my brother to buy a petrol station which he ran for 30 years and he helped me when I was Self Building 4 houses over 30 years to live in ( as not being an MP I could not Flip for tax purposes).
    We have two sons both of which we have helped in various ways, and 2 older grandchildren both of which have been helped by us and there father, all our family have the advantage that up to now, as we are still married our house and savings have not had to be split in two, as so many who have divorced have seen.
    With regard to Pensioner benefits as with all benefits only those on the lower rate of tax or no tax at all should receive all of the benefits.
    Another thing on Tax relief on Pension contributions we the tax payers should only give 20% on those contributions and double the the annual amount that can be put In.

    1. Lifelogic
      February 24, 2015

      You can flip for CGT (just like MPs did) so long as you lived in them for a time as your PPR.

    2. Andy
      February 26, 2015

      “Another thing on Tax relief on Pension contributions we the tax payers should only give 20% on those contributions and double the the annual amount that can be put In.”

      “We the tax payers” give 0% on pension contributions. It’s tax relief, not money paid out by other tax payers.

    3. Robert
      February 27, 2015

      Tax relief is given to higher rate tax payers as it is meant to be tax neutral i.e. they pay in and get relief at their highest marginal relief and will then be taxed on the pension they draw – you seem to misunderstand the nature of the relief and advocate populist the typical socialist politics of envy.

      1. Robert
        February 27, 2015

        Please correct the last sentence.

  2. Mark B
    February 24, 2015

    Good morning.

    For Pensioners and the like, read the New Kulaks.

    This is what Socialism does. It artificially creates a problem or, in this case a section of society that they see as disadvantaged. This allows them to create an false argument and thereby take the so called ‘moral high ground’.

    They argue that there needs to be government intervention to address this unfair imbalance and that new laws, powers, department(s) Minister(s) and all the accompanying paraphernalia be created to support this new government initiative.

    Clearly some people have identified some big fat juicy cash -cow. And boy, are they going to milk it.

    But what happens once you have squeezed out all the juice and there is nothing left ?

  3. Narrow Shoulders
    February 24, 2015

    True each generation is coping with its own challenges. Many of these challenges arise from a rapidly increasing population. A policy pursued ad nauseum by the political classes to the detriment of its own people.

    Unfortunately many of the political classes believe its people are European.

    1. Timaction
      February 24, 2015

      Indeed. Public services, particularly our Hospitals are now starting to be overwhelmed through shear numbers and the politicos hope to just see theirselves through until after May.
      Good to see that the Westminster village and its attitudes towards income and expenses haven’t changed in the last 5 years…………again!
      We need root and branch reform of our political class with so many in it for their own gain!

  4. Lifelogic
    February 24, 2015

    Well I would not give free bus passes or winter heating allowances to anyone. No one should have to pay a tax to the BBC just to be allowed to watch TV and have lefty propaganda dripped at them. Some people might benefit greatly from a bus pass where others have no need of one but would like to use the money from something else.

    Individuals should decide how to spend money not have the governments decide it for them.

    I see that Sir Malcolm Rifkind does not think he has a salary and is self employed. Also that the MPs remuneration package of over £67,060K (plus the most generous pension around, subsidised bars and restaurants and other benefits) is not sufficient and below what other professionals earn. The average professional salary in the UK is actually under well under £50,000. Salaries of these and others skilled people has also been hugely depressed by open door EU immigration.

    He keep referring to the “allegations” – they are not “allegations” it is a video of himself saying what he chose to. He seems to think he has done nothing wrong. The man simply cannot be allowed to stand again.

    1. Lifelogic
      February 24, 2015

      Sir Malcolm Rifkind has at least done the right thing. Even if he says “I don’t think I did anything wrong. I may have made errors of judgement. That’s a different matter.”

      One can certainly see how MPs come to pass the most insane laws such as the climate change act and the likes if we have, as Richard Littlejohn puts it, the Hon-Member for Unilever, Unite and Beijing West.


      1. Anonymous
        February 24, 2015

        So ready to sell and so easily fooled.

        So why the high price ?

      2. Glenn Vaughan
        February 25, 2015

        Why would anyone in their right mind pay £5,000 to Jack Straw to listen to him deliver a speech on any subject?

        1. Lifelogic
          February 26, 2015

          Indeed it is rather unlikely to be his speaking skills or general expertise that any companies would be seeking.

    2. Bazman
      February 24, 2015

      Pensioners do not pay for a TV license over the ages of 75 and do tell us what you would spend the heating and bus pass money on. Tax cuts for them by any chance?

    3. zorro
      February 24, 2015

      I must admit that my blood did ever so slightly boil when I heard him ‘explain’ his behaviour – no salary, self employed…. he also said that we would be surprised at how he was not so busy and had so much spare time!


  5. Dame Rita Webb
    February 24, 2015

    “Conservatives have announced they will keep Pensioner bus passes, free tv licences for the over 75s,and winter heating allowances. ” Sorry John but these are just titbits. How about letting the grandparents hold onto their houses so that they can pass them on to their grandchildren. As things stand today, due to long term care costs, there is a high probability of any inheritance going up in smoke. If there is money to provide all the free goodies for anyone who has made it out of Calais, there is money to pay for the ltc costs of those who have paid more than enough into the system already.

  6. Jerry
    February 24, 2015

    Aspirations, that is something not mentioned by John, although “Expectation” was!

    What I mean is this, many if not most of the baby boomer generation were born into a time when renting ones house was as normal as buying it (or at least taking out a mortgage loan…), where having (but not necessarily owning) even one car was considered a luxury never mind two or more, whilst the domestic vacuum cleaner had more or less become the norm the washing machine (side tub and perhaps separate spin dryer) was not, as indeed was the TV and the list goes on – our generation grew up to aspire such items and not expect them, now because of our consumer lead economy the generations born from the 1970s on now expect such things and often want them all at once not realising that the (grand)parents generation had often waited and saved hard to obtain such items -no Credit Cards for us, even if HP was an option. So not a war, just perhaps a major misunderstanding.

    Conservatives have announced they will keep Pensioner bus passes, free tv licences for the over 75s,and winter heating allowances. Do you agree?”

    Yes, but still not real promises on the cost of care, nor the standards of in home-help care (in particular), even more so when one considers that many in such need either served our country during WW2 or took the brunt of true austerity so to hep the country and her economy recovered afterwards. But and when, if ever, will Pensioner bus passes be extended to cover rail travel?…

    1. Anonymous
      February 24, 2015

      Jerry – This isn’t an issue of wealth – percieved or otherwise.

      Your (our) generation were gifted a wonderful country and let it slip through our fingers.

      1. Jerry
        February 27, 2015

        @Anonymous; Sorry but it is an issue of wealth, or at least one of perceived equality, credit cards and other forms of easy credit allow people to indulge-today but repent-tomorrow when the realities that not all can afford everything all of the timer, some of the time or perhaps any of the time – then, of course, some will try to find scapegoats rather than blame themselves for those errors of fiscal or social judgement…

  7. David Cockburn
    February 24, 2015

    Writing as a pensioner I do think these free bus passes, winter fuel allowances and TV licences are a ridiculous idea. Much more sensible just to increase the (taxable) state pension by the cost of them and leave the pensioner free to spend their money as they wish.
    However, I agree with the central point of your post. There is a balance of advantage between the generations. Further, it is unsurprising that older people are richer as they’ve had forty years of accumulating assets to build up their net worth.

    1. Lifelogic
      February 24, 2015

      Exactly but MPs do like to play Father Chrismas with other people’s money. They think it buys them votes.

  8. Sebastian Weetabix
    February 24, 2015

    Real inflation is not low. It has been fiddled to appear so by leaving the real costs of housing out of the figures, a disgraceful sleight of hand by Brown which has been perpetuated by the coalition and the Bank of England, because it suits politicians to pretend inflation is low rather than prick the housing bubble.

    I pity young people who do not have rich parents.

  9. Margaret Brandreth-J
    February 24, 2015

    Yes I agree, if pensioners are having to use buses as a form of transport then ( in most cases) they have not been lucky enough to drive a car.This may not apply to central London where the tube is the main form of transport , but still it is very expensive.

    We work hard all our lives in the midst of all sorts of negative competition .There are not many people today who superficially boast about their 6 houses and other acquisitions in the hope that all will be in awe . They would be told to get lost or the equivalent.It is not’ Posh’ to crudely show off; so what should they do with their money? There is a limit to how much extra tax they should pay , so they must be encouraged, for the sake of retailing, to pay for brands.

    Others like myself who were very comfortable and then totally wiped out ,through no fault of my own and have struggled to get back on track ,want to leave capital to my children in the hope that they will not suffer similarly. I know these children work hard,are honest and have their own children to set an example to , however I would not accept that many of the youth offenders , adult criminals ,layabouts and thugs should have a share of my money, although this is what happens via taxes.

    Over 75 year old’s in the main are less mobile , spend more time sitting down , have finished working and watch TV more so these benefits should continue.

  10. Lifelogic
    February 24, 2015

    On the wider point of “Fairness between the generations” all have suffered from incompetent over taxing and bloated lefty governments like Cameron’s. The elderly have suffered negative real returns on bank deposits which are taxed too to add a further insult. We have had Osborne’s 299+ of tax increases and the removal of child benefit and personal allowances for many and further mugging of their pensions. The young have expensive houses to try to buy, debts for (often worthless) degrees to repay, more competition for jobs from open door immigration and all the 299 tax increases to pay.

    I remember my first flat in London being a huge struggle to buy then and renting out rooms just to almost keep up with the mortgage. Then we have Major’s moronic ERM, destroying businesses, vast mortgage arrears, home and lives with pointless 17%+ interest and mortgage rates. The result of his idiotic attempt to shadow the value of the DM.

    We need more houses, less OTT building regulations, cheap energy, no green crap, simpler, cheaper & quicker planning, less government in general, lower taxes, more freedom and less regulation. We also need schools and universities that teach useful things STEP subjects, engineering and building skill etc. rather than endless useless degrees in divinity, humanities and the likes. If people want a hobby let them fund it themselves. Finally we need a simpler legal and tax system that needs far fewer tax experts and lawyers – who are in essence usually parasitic on general efficiency and harms UK competitivity.

    The best thing the Tories could do for their election chances and to help the younger generation is to abolish IHT or at least de-rat on their £1M threshold promise. It should be £1.2M now each with inflation. IHT is a tax on the recipients after all in effect and a disincentive to work.

    1. Bazman
      February 24, 2015

      Less than 3% of the population pay IHT so what would you cut to fund this tax abolition for the few. A disincentive to work for the recipients thats for sure and giving massive inequality of opportunity to a lucky few. It is also a just tax as it is hypocritical to bemoan the poor standards of public services in this country while at the same time call for a major source of state revenue to be scrapped.

  11. Cheshire Girl
    February 24, 2015

    I’m sick to death of all this knocking the ‘oldies’ . In many cases if we have a reasonably affluent lifestyle it is because we have worked hard for it.

    I am 75. I was brought up in a house without electricity, hot water supply, indoor toilet, central heating etc. as were many of my generation. I left school at 15 to work at a low paid job with quite long hours. I learned shorthand/typing at night school, paid for entirely by myself. I haven’t asked for anything from the state or ever broken the law. I’m not saying I am perfect, and I do feel for the young people today who would like to work but cant get jobs. Most of their problems are caused by mealy mouthed politicians who are always looking for excuses for their own mistakes.

    The older generation make an easy target. Please politicians of all parties – give it a rest!!

    1. Margaret Brandreth-J
      February 24, 2015

      well said.

  12. Old Albion
    February 24, 2015

    As someone who has for the first time, recieved ‘winter heating allowance’ which is paid to the poor and millionaires alike !! I wonder how much it costs to administrate this ‘benefit’ which is a help to some. But not a necessity to all.
    I’m not sure of the rules locally Re. ‘free bus passes’ as i have never claimed one. There are only two or three busses a day that pass through my village. It’s much simpler to hop into the car.
    ‘free TV licences for the over 75’s A fairly ridiculous ‘benefit’ this. The TV licence should be scrapped altogether. It’s a tax to watch politically left-bias propaganda.

  13. Leslie Singleton
    February 24, 2015

    Apart from for people in genuine need I believe in “User pays”, which is the American way. At least benefits like bus passes and TV licences can only be used for those purposes. As for Winter Fuel Allowances (How long before Summer Air Conditioning Allowances?) they should somehow be reserved for those who are really suffering from the cold. I have a millionaire friend living in Belgravia (or could be Mayfair – not sure) who when a number of us meet for lunch in the City loves telling us about his use of his free bus pass to get there, It’s a big joke to him of course but I find it ridiculous. Something else that Cameron has the wrong end of the stick on.

    1. Anonymous
      February 24, 2015

      It’s an issue of how to taper such benefits, Leslie.

      If we’re not careful the gap between the aspirant and the feckless closes even more than it has and that is a greater injustice than a few rich people using a bus pass for a laugh.

  14. alan jutson
    February 24, 2015

    Agree all generations have been hit to some degree or another, agree all have had some benefit again to some degree or another.
    Do remember that most have paid in one way or another, either in student fees, or a lifetime of tax and insurance contributions.

    Those that seem to have done best under all past governments, are those who have chosen not to work at all, but instead live off of the State (taxpayer), they seem always to have a large number of children (subsidised by the taxpayer), have a house that is paid for by the State (taxpayer), have paid absolutely nothing into the pot, and see not reason why they should.

    The sooner the Benefits cap is reduced to a figure way, way below the median wage, the sooner we will get rather more fairness for everybody.

    1. A different Simon
      February 24, 2015

      Agree with you that all generations have suffered .

      John’s article is a bit divisive in a divide and conquer sort of way .

      What we are told is that the entire first world is supposedly drowning in public and private debt .

      It follows that :-
      – If there are debtors , then there must be creditors .
      – There are systemic problems .

      Surprise surprise the creditors are the same people who have set up the system over the last couple of centuries .

      The benefit bill is a storm in a tea cup and I don’t think you do yourself any favours by directing the argument towards people adrift at the bottom of the foodchain .

    2. a-tracy
      February 26, 2015

      I agree Alan both about benefits caps being no more than a workers wage and by far our biggest problem the people who feel entitled to money for nothing all their lives. It would be interesting to see a breakdown of 50 year olds and what % have contributed less than £200 per year (or less than £6400 in NI in total) all their adult lives in national insurance that was expected to pay for their healthcare, state pension, care etc. I’ve always wondered what the figure is per year that you would have to insure yourself privately to give you a state pension at the proposed levels from 67, to provide healthcare all your life and care home insurance.

  15. Richard1
    February 24, 2015

    Who is in the younger generation and who in the older. 60 is in the older and 20 is in the younger but what about 35? Or 37 or 31? This analysis is contrived. What can clearly be said is that sclerotic economies with high taxes, high levels of protectionism and a big state offer much less opportunity to young people, unless those young people come from wealthy backgrounds or are well connected. One of the ironies of big state leftism is it leads to less social mobility and less opportunity for people to get on through their own efforts – which such states then try to resolve by creating more and more state employment and welfare.

    1. Bazman
      February 24, 2015

      Letting the markets rip has produced no inequality you are arguing in particular to the younger generation competing for fewer jobs with cream of Europe which employers of course will take over them. The undermining of the unions and working conditions allowing lower pay.
      The MCSSS stopping young peole getting jobs as they cannot pay for jobs as interns.
      IHT to be abolished further giving unearned advantages to a certain few.
      What on earth are you talking about? It socialism of the rich that you are supporting with knowing it

  16. Bob
    February 24, 2015

    For over 75’s the £500 million is paid to the BBC from the welfare budget.
    This is wrong, over 75’s should be simply exempted from TV Licence liability. I don’t see why the BBC should be so mollycoddled when everyone else is tightening their belts.

    Put the money towards a pay increase for nurses.

  17. acorn
    February 24, 2015

    Our children’s government will have just as much money to spend as our government has today. The same as my parents government had. The limit of spending in all three generations is the capacity of the economy to provide goods and services while controlling inflation at as near full employment as you can get. The 250% Debt to GDP we had after the war, has not stopped my generation from buying train loads of I-Phones has it.

    There is no sovereign currency “saving” by a government that issues its own currency; as there is no government “debt” account. (Why would a government that issues its own currency, want to borrow back what it had spent into existence previously?).

    A government that runs a budget surplus today, without a trade account surplus, is just permanently destroying financial assets that belong in the private sector today. Sovereign currency flows into the economy when the Treasury spends it (out of thin air). It flows back into thin air when the government gets it all back again, 100%, in Taxes.

    So, if you want to reduce the governments, so called, “national debt”; which strangely is exactly equal, Pound for Pound, to the non-government’s sector “savings”; then spend every Pound of your savings, in the most tax-inefficient way possible. Mr Osborne is going to do his best to make you anyway. If UK keeps the level of net imports we have today, then we will have to use all our savings and increase our debts to buy them. And, you will have to make a contribution to Mr Osborne’s budget surplus in 2019.

    Not spending money today is a legacy you don’t want to leave your children. They will not appreciate roads with bucket sized pot-holes in them; falling down schools and having to wait four weeks for a Doctors appointment, because we are not training enough skilled people and generating the jobs to keep them employed!

    1. petermartin2001
      February 26, 2015

      “A government that runs a budget surplus today, without a trade account surplus, is just permanently destroying financial assets that belong in the private sector today. ”

      Exactly yes. This is what the Germans have forced the Greeks into. The result is the Greeks have turned to the kind of politics that most commentators on this blog wouldn’t at all like for the UK. So why are the economists of the political right so keen to attack the private sector?

      Yes there would be a need if inflation was rampant. But when its negative?

  18. Anonymous
    February 24, 2015

    One would imagine that the vast majority of your contributors are over 45. So why would anyone be determined to start a battle between generations ?

    Perhaps it’s that we genuinely feel sorry for the young. Us older people were never forced to compete with the whole world for local jobs and local housing as our young are now.

    We always understood that Britain had to be more competitive in the world and knuckled down – but we didn’t expect that politicians would make ‘competition’ mean importing cheap labour and subsidising it to undercut our own !

    Low interest rates and inflation ? A 10x salary house price is not unusual these days. Previous generations had only 3x to contend with and could rely on inflation to diminish it pretty quickly. There was a good supply of long term employment around then too, with pensions provided as well.

    Not now. It’s either house OR pension – someone who has the two can consider themselves lucky indeed.

    I bought my first house on a £20k salary for £60,000 on 7% interest. I now earn £50k and that same house is £400,000.

    If interest rates do normalise the country is going to tank – and I’m not sure of the wisdom (or the decency) of advising the young to take out such large mortgage multiples where the rental value (the real money in circulation) is so out of kilter with the sale price (loaned money created by commercial banks.)

    1. Anonymous
      February 24, 2015

      “There is another truth which the generation warriors ignore. Within most families one generation helps another. Much of the wealth of the baby boomers will be passed on to their children and grandchildren on death. Some of it is being passed on before death, as parents help children with home deposits or other large ticket items in their budgets.”

      Whoop-de-doo !

      My parents didn’t have to help me at all.

      I anticipate that much of my old-age provision will be handed over to my kids before I die. This is unexpected and I have not planned for it. The country is clearly in crisis.

      And why do you think this is, John ?

      As for ‘generation warriors’ we’re not warriors. What we’re saying is that our young have a right to be annoyed with us for allowing politicians to give our country away and that we deserve what’s coming.

    2. Anonymous
      February 24, 2015

      “I bought my first house on a £20k salary for £60,000 on 7% interest. I now earn £50k and that same house is £400,000.”

      Friends regarded this house as a small-ish ‘starter’ home. It served as a reasonable family home. I sold it and moved out of the SE. I can’t afford to buy it back without a very large mortgage.

      But if I’d stayed and wanted to share out the equity to my two offspring (say 100k each to be generous) they’d still have to take out a 300k mortgage each to buy the same house that I started in. On their average wages of 26k pa (over 10x salary)

      So where do I live then ? Move up to Lincolnshire and add to the transport crisis and the elderly alone crisis ?

      I can’t bleat (as single mums do) that I would lose my support network and need to remain locally with government support.

      Your idea doesn’t stack up, John.

      The young are getting poorer. A lot poorer.

  19. Denis Cooper
    February 24, 2015

    “Conservatives have announced they will keep Pensioner bus passes, free tv licences for the over 75s,and winter heating allowances. Do you agree?”

    No, I don’t agree; and I think that to slightly different degrees they are all three examples of how a party in office may introduce a costly gimmick designed solely to buy the votes of a section of the electorate, and it then becomes difficult for another party to go into an election saying that they will remove it even if there is a good case for doing so.

    As far as the free TV licences and the winter heating allowances are concerned I would abolish them and compensate pensioners with a one-off increase in the state pension, and at least save on the bureaucracy while allowing recipients to make their own choices as to how and when they spend the money. The winter heating allowance in particular I have always seen as an insult to people who have had long experience of managing their finances and who do not lose their ability to budget for their expenses just because they have retired; indeed I’d say that almost all of them routinely do a much better job with their personal finances than Brown did with our national finances.

    As for free bus passes, well, I’d agree that there’s a case for free or cheap off-peak travel on public transport which would otherwise be under-utilised, but I see no strong reason why that concession should be restricted to pensioners.

  20. Bernie Gudgeon
    February 24, 2015

    The contentious benefits, TV licence and winter fuel allowance, were a means of supplementing poor pension provision. Pensioners as a whole are less impoverished than a decade or two past, and many of the better off would be sympathetic to relinquishing the nice-to-haves. There would need to be a quid pro quo, however: these same pensioners have an equally poor view of benefits in general, perhaps of foreign aid. Means testing may also stigmatise the pensioners who retain supplementary benefits, and that matters to some.

  21. Bert young
    February 24, 2015

    Those who have worked and paid their taxes all their lives are entitled to the gifts the country provides. It would be criminal to now take these gifts away or have them means tested. The older generation have suffered many hardships and now, when they are defenceless, should be protected .

  22. oldtimer
    February 24, 2015

    The big penalties are levied on the savers. By comparison the young vs old argument is a sidehow.

    Re bus passes and the winter fuel allowance my advcie would be to include them in taxable income like the old age pension. Thus those who fell into a tax paying bracket would pay the appropriate tax on them, and those less well off pensioners whose income fell below the income tax threshold would receive the full amount. That would save the absurd additional costs costs of administration of any means tested scheme.

  23. Martyn G
    February 24, 2015

    I am one of those who benefit from winter fuel allowance, bus pass etc but after a lifetime in work and with sensible savings in the past, I have no need of these things. But there will be many who are dependent on these benefits (e.g. to keep warm in winter) and it is clearly important that they should not be deprived of such.
    What is wrong with the system is that I cannot opt out of it. Introducing means testing to determine who does benefit would add much unnecessary complexity to the system. To demonstrate fairness in this matter would be so simple, that is to say allow people to opt out of the system. If I could opt out I would do so but being unable to, each year I donate my winter fuel allowance to a charity (not one of the big state-sponsored ones!).

  24. agricola
    February 24, 2015

    Your entry today cannot be answered with glib one liners so brace yourself.

    High house prices and high rents reflect the market situation. It is called elasticity of demand and uncontrolled immigration is a major factor in causing it. The government through their “Help to Buy” scheme are baiting the hook. Will you be around when “Help to Pay” becomes a necessity with increases in interest rates.

    Government haven’t a clue when it comes to building more houses. The industry is in the stone age in terms of design and building methods. Factories could be turning out houses by the hundreds of thousands. Henry Ford gave you some clues as to how and now the Toyotas of this World allow all sizes, designs, and colours.

    Pensioners with annuities were being screwed well before the banking crisis and the money printing bonanza. Who was guilty, first the government with Gordon Brown in the treasury for stealing £5 Billion per annum from pensions. A theft that has not been rectified. Second, government for allowing the pension industry to continue to devalue peoples pension pot by at least 30% through bogus fees and commissions. Any fees should be based on annual profit achieved not on the size of the pot.

    I give the government credit for the latest National Savings Bonds but a big debit for not removing Inheritance Tax and Stamp Duty. Both are inhibiters of GDP, and a reflection of government thinking it can spend our money better than we can. As one contributor keeps telling you, government can in the sense of pissing it down the drain, but is not in the sense of getting value and good effect, no way.

    As to pensioners retaining their freebie bus passes, TV licences, and heating allowance, I would cynically suggest that someone at Tory HQ has woken to the fact that pensioners are a large voting segment of the electorate and are much more likely to vote. You would be unwise to cancel the miniscule winter heating allowance for southern European ex pat pensioners. Read Peter Mayle on the subject of northerly winter winds blowing the ears off donkeys.

    Your achievements on the economy are based on an unbelievable level of borrowing. Are you hoping to repay it from an increased tax take or is it to be the anvil around the necks of the next two generations. You already have my views on drastically reduced tax and government spending so I will not bore you with a repetition.

  25. DaveM
    February 24, 2015

    It’s not the older generation which has saddled our kids with horrendous student debts.

    It’s not the older generation which has chosen to have to spend their hard earned equity on care in their dotage – thus reducing their kids’ inheritance. (Unless of course they’ve lived on benefits all their lives – in which case the govt will pay for it.)

    It’s not the older generation that opened the doors to mass immigration to low-paid workers, making it almost impossible for our kids to get part time and summer jobs, or for young mothers to get a part time job. And they, for the most part, didn’t advocate the ridiculous benefits culture we now have thus meaning we HAVE to have mass immigration to get stuff done.

    It’s not the older generation which voted to give away billions in foreign aid and windfarm subsidies, and it’s not them who overspent thus leaving us with a huge debt and defecit meaning that billions are going on interest alone.

    It’s your lot in Westminster who did all that.

    And it’s us middle-aged folks that are breaking our necks to try to make sure our kids and grandkids don’t get s*** on the same way we have been.

    So, in all honesty, I don’t really give a toss what you give to the over 75s – as long as you get their votes, eh?

  26. dumpling
    February 24, 2015

    The Help to Buy scheme has not helped would be first time home buyers get on the property ladder as it just increased demand and thus house prices. It was just a typical headline grabbing Osborne wheeze. There are in excess of 900,000 empty properties in this country. Owners should be encouraged to fill them by whatever means.

  27. JoolsB
    February 24, 2015

    One has to wonder what parallel universe our out of touch politicians live in. The only ‘wealthy’ pensioners nowadays are the ones with taxpayer funded pensions, ie. our over indulged politicians, public sector workers and bankers. The rest, through no fault of their own, have seen their private pensions, usually non-index linked to get a better deal, decimated by the politicians and bankers’ mistakes and then to add insult to injury Osborne introduced the Granny tax meaning all pensioners on modest incomes have seen their incomes virtually frozen over the last four years. Unlike the elite club above, these pensioners struggle to make ends meet, and certainly do not have any spare cash to put into granny bonds or to help their families with. If only they did. They could help their grandchildren with the crippling burden of debt this UK government has imposed on them if they dare to go to university, but only if they are English of course.

    Talking of which John, have you now given up on speaking for England now Cameron has ratted on his promise of English votes for English laws?

    Reply No I have not given up on speaking for England!

    1. Jerry
      February 24, 2015

      @JoolsB; “[..//..] Cameron has ratted on his promise of English votes for English laws?”

      I think that is a tad strong, if there is no majority to get such an Act through parliament -in not much more then six (now around four?) weeks before the “wash-up” and GE what’s the point flogging it, of course if there is no mention (better still pledge) for EVEL/EVEN in the Conservative manifesto…

  28. Tom Snoxell
    February 24, 2015

    Thanks John for a balanced analysis as always. It is more complex than “generation warriors” make out. However, I have a couple of issues with your analysis:

    1. The young benefit from very low inflation & interest rates – While this is true, this comes as a result of a horrific economy. No growth leads to low inflation and therefore interest rates. The young benefit from the symptom but suffer from the cause.

    2. Wealth is passed from generation to generation – while this is true, think about the psychological impact. The young look to their elders and see themselves as failures when they cannot achieve what their parents have. They cannot move out from the family home and feel like failures. This is tremendously damaging. Finally, what of those with poor parents – what then?

  29. David Murfin
    February 24, 2015

    I am perfectly capable of deciding whether and how to pass on my acquired wealth to those most in need, without the intervention of the state taking some of it and spending most of that in other unprofitable directions. Bus passes etc are tinkering around the edges to attract votes to a ‘caring party’. I would be more impressed by consolidating their value into the state pension, or a further rise in the initial tax threshold, removal of inheritance tax, and abandoning vanity projects like HS2. The Chancellor might even get his tax back in VAT and the growth that would result from money being spent as those who had earned it chose for themselves.

  30. waramess
    February 24, 2015

    Oh dear, the election is now in full swing and apart from the spin we will now find we are to be bribed with our own money.

    So far this has proved to be a very negative pre election posture by all three main parties and now we are to see bus passes, free TV and heating allowances wheeled out.

    A once very promising star reduced to defending a very mediocre government is something I really never wanted to see but there is nothing else that can be done so long as they continue to promote mediocrity.

  31. Kenneth
    February 24, 2015

    I certainly do not agree with the free bus pass, tv licence and heating allowance.

    I do agree with your statement about families helping each other.

    The more the state does the less we help each other. In my opinion this goes for society as a whole. I am convinced that there is a correlation between selfishness and state handouts.

    I think we refrain from helping each other while we know that the state is doing it for us and I believe this damages society. I think that if we drastically reduced welfare we would be living in a happier place.

    1. Bazman
      February 24, 2015

      A 1950 England that never was and never will be. Millions to struggle even more than they do for you deluded ideology.

      1. Robert
        February 27, 2015

        Certainly no more than your vision of a socialist welfare state that has entrapped multi-generations of families into sink estates with socialist centralist social engineering – leaving people with a lack of self-worth. Success, wealth and happiness come from self endeavour, hard work, some luck and a drive to succeed often leading to a sense of achievement and success.

        1. Bazman
          February 28, 2015

          Absolute claptrap and will be your only post no doubt.
          A socialist welfare state exist due benefits paid to subsidise poverty wages paid by many high profit employers.
          Work in many cases does not pay and your idea that further hardships imposed on the population, by taking away their benefits will somehow improve their lives is just deluded. Tell us how no benefits, no minimum wage, no housing benefits will somehow incentive them? Will they then find high wage jobs that do not exist for them?
          What we are seeing is the results of running a country for the benefits of the rich. Socialism for them and extreme capitalism for the poor needing massive state subsidy to enable them to live.
          They cannot live like third work peasants its not possible.
          Tell us why communism did not work and you will see the same for extreme capitalism which you proposes to impose on a poor minority.

  32. Atlas
    February 24, 2015


    I must point out that your analysis omits the significant point that many now approaching retirement are discovering that the dates they can draw their state pensions (and benefits like the bus pass) are receding into the distance. This is especially true of women coming upto the age of 60, whose date of collecting pensions have moved by a considerable 5 to even 6 years.

    Also the change in the number of years contributions that you need to make to collect a full state pension was abruptly changed by this government.

    So to the young I would point out that politicians will diddle you out of what you were promised and encouraged to plan on, at the drop of a hat.

    Reply No it’s not diddling. People’s life expectation has gone up a lot, which is good news. It means taxpayers need to provide more tax revenue to pay all the pensions for longer, so some of the adjustment is being made by raising the retirement age.

  33. stred
    February 24, 2015

    It worries me that the youger generation which has missed out on the housing boom does not understand why it has happened or why there has been a huge incresae in the numbers of BTL investors. Today, the Greens, who may well win in my constituency revealed that they wish to bankrupt most BTL investors by removing tax relief for mortgages. In other words the landlord has to borrow from a bank to subsidise the rent, which in the London area earns around 4% on value. The leader of the Greens did not appear to understand very much about the reason for businesses being able to claim for costs against profits, but their supporters probably don’t either. Neither do they understand the economics or engineering behind renewables and so their vote is unlikely to diminish. Their policy legalising skunk is also likely to appeal to their main vote. I delight in pointing out to my leftie friends. who have also realised that pensions are a rip off and invested in a property, that they are now ‘dodgy’ rentier class and will be purged by the politicians they vote for.

  34. PT
    February 24, 2015

    “The younger generation has the benefit of much lower interest rates when they can find a house and a mortgage than their parents faced. They also now have the benefit of very low inflation, compared to the rates we were used to in the 1970s and early 1980s. The government has added its Help to Buy scheme”

    Ultra low interest rates mean house prices rise to absorb extra borrowing potential. Younger home buyers don’t really win.

    Low inflation mean a mortgage with massive capital repayments but lower interest rates means the lifetime cost of the mortgage is much, much greater than ever before. The burden will not ease after 3-4 years like it used to. Younger home buyers don’t really win.

    Everybody warned (inc the Treasury) that Help to Buy would largely boost house prices, with additional construction modest at best. They were right. Prices paid by FTBers surged 10% after it’s introduction. House builder shared did very well though.

    Why are you always so blind to the mechanics of the housing market, John?

  35. Vanessa
    February 24, 2015

    JR to answer your last question. I do not agree that pensioners should keep their free bus passes and TV licences – they are very useful but not essentials. However, I do agree that the heating allowance should stay as we all know that the cold kills and therefore this one giveaway, I think, should stay.

    The TV licence should be abolished as should the BBC and Channel 4 – both controlled by the political elite. The BBC should be broken up and sold off; never has a State Controlled Media been so biased, corrupt and full of lies. Thank God for the internet for the truth.

    1. DaveM
      February 24, 2015

      You can’t get rid of Channel 4! How else would the visually impaired be able to read the Guardian? That’s prejudiced against blind champagne socialists Vanessa!

    2. Bob
      February 24, 2015

      “The TV licence should be abolished as should the BBC and Channel 4 – both controlled by the political elite. The BBC should be broken up and sold off; never has a State Controlled Media been so biased, corrupt and full of lies. Thank God for the internet for the truth.”

      Well said Vanessa, and we certainly don’t want to see TVLA thugs intimidating elderly people who can’t afford a TV Licence and don’t fully understand their rights to refuse to allow their house to be searched without a search warrant.

      An utterly ridiculous system in the 21st century.

  36. ChrisS
    February 24, 2015

    As someone who now qualifies for the winter fuel allowance but still has 18 months to go before getting a bus pass, I’m in the perfect position to comment on this.

    Gordon Brown should never have given these extravagant bribes to all pensioners when they predominantly have to be paid for by working families.

    I have friends who live in France and pay the majority of their taxes to the French Government yet they get a fuel allowance from the UK. They are indignant when I suggest they should not get it because, they say, they are entitled to it.

    This is yet another perfect example of Labour’s attitude to taking and wasting other people’s money without giving the slightest thought to the difficulties it would cause. I’m quite sure that the Civil Service recommended not going ahead with the measure.

    The Winter Fuel allowance and TV licence should ideally be means tested but that has a cost implication and would mean employing even more civil servants to manage the system.

    Far better to adjust the higher rate tax thresholds for the retired so that the benefits are at least taxed at the highest marginal rate for 40% and 45% taxpayers. But so many people now pay no tax at all that I would reduce the basic personal allowance for the retired so that everyone in receipt of these benefits pays tax on them.

    Giving out bus passes to everyone in receipt of the state pension was a stupid, scattergun approach. I’m not particularly wealthy but in 18 months time I will have the choice of going on a journey by bus for free or taking my Ferrari !

    How ridiculous is that ?

    I’m not sure what to do about bus passes but there must be some way of restricting them to those that really need one.

    It will take a brave Government to take these benefits away altogether but that’s what should really happen. As the population ages, they will simply become ever more unaffordable.

  37. bluedog
    February 24, 2015

    ‘The money which is not passed on will be taken in tax by the state. That money can then be spent on those most in need.’

    Translation: the family homes of the native British will be sold to meet Estate Duty commitments and the money spent on social housing for unemployable immigrants on benefits.

    It’s happened twice now so I’m not making this up.

  38. Denis Cooper
    February 24, 2015

    While it’s often true that parents and grandparents will help out the younger generation they’re not always able and/or willing to do that and then young people can face serious problems.

    1. Anonymous
      February 25, 2015

      I agree, Denis.

      The old can face serious problems too – say if they have had to move to a cheaper part of the country or their young (that they invested so much in raising) have emigrated for a better way of life.

      At least part of the elderly-alone crisis is because families have moved apart and grown distant.

  39. Pauline Jorgensen
    February 24, 2015

    As far as free bus passes are concerned colossal waste of tax payers money and a blatant bribe when they were introduced, many people I know who use them don’t need them and run more than one expensive car as well as using a free bus pass. I don’t blame them but I dot see why the tax payers are funding this.

    1. Cheshire Girl
      February 27, 2015

      Some of us are actually saving the taxpayers from having to pay for Bus Passes for the elderly. I am eligible for a Bus Pass but I don’t bother to apply. Why? We don’t have a single bus service where I live. The nearest one is a mile from my house up a windy road with no path/pavement. You take your life in your hands walking up there.
      I live on a development of over 400 houses. As the population has aged, several people have lost their partners, and if they do not drive, they are marooned, having to depend on their neighbors for transportation. Our MP has contacted the bus company but they wont budge. Im sure there are other areas like mine in this country, so I thought I should put the ‘other side’ as there is so much talk about us oldies riding the buses at taxpayers expense!

  40. David
    February 24, 2015

    How about the same number of houses as a percentage of the population being built as in the past? That would make things a lot fairer.

    Of course a lot of the problems for old people come from the emergency low interest rates we have had for so many years.

  41. behindthefrogs
    February 24, 2015

    I agree with the retention of bus passes as they are mainly used by the less well off pensioners. They also help to reduce the number of cars on the road and thus have a green benefit.
    The winter fuel allowance should be replaced by a higher rate of old age pension during the winter months. This would make it more likely to be used for the purpose for which it was intended, particularly by the poorer pensioners, and stop it being a Christmas bonus. This would also make it taxable and thus reduce its value for those paying higher rates of tax.
    The TV licence is becoming an anomaly for everyone and so should be removed and the BBC given a grant from general taxation. This would reduce the costs of providing the licence and of chasing non-payers. This would remove the debate about the various methods of receiving TV programmes.

  42. A different Simon
    February 24, 2015

    The younger generation are comprehensively Donald Ducked .

    It is not merely difficult for them , they don’t stand an earthly – unless their breeding is right .

    If they are born into the right family the establishment will ensure they get a job in the civil service or one of those quango’s Cameron was supposed to be incinerating .

    Your profession has ruined the lives of a generation of children born to ordinary people seemingly in order to perpetuate the privilege of the children born to the elite .

    In your penultimate paragraph you even seem to concede that we have gone from young people having a modicum of control over their own destiny back to their destiny being decided by how much they inherit .

    1. Anonymous
      February 24, 2015

      And so too the Conservative Party is Donald Ducked.

      Blair has engineered a permanent Labour constituency.

  43. A different Simon
    February 24, 2015

    At least the America Dream is just about alive .

    Over here it’s dead . Social mobility has been quashed .

    The sensible young are leaving and they won’t be coming back .

  44. Mike Stallard
    February 24, 2015

    I am an OAP.
    I do not really need the fuel allowance. I do not really need the bus pass. Over 75, I do not actually watch a lot of TV either.
    I love my grandchildren and we are not at loggerheads with their parents – who have all gone to live abroad. We save and save and do a little work to try to get to see them. Abroad, they are all doing well. The one remaining one here is doing a lot better now that the Conservative-LibDems are in power. Before that he was virtually working for free.

  45. petermartin2001
    February 24, 2015


    You’ve not mentioned the employment situation. Many of us, the older generation, weren’t fortunate enough to have wealthy families or relatives to help us get started in life but were lucky to have free education and we weren’t short of job offers later. If one job didn’t work out we’d just move on to a different one.

    So, the famous “Yorkshiremen” Monty Python sketch where the old men compete to describe the most impoverished childhood needs to be inverted. When I was younger I used to be routinely pestered by companies wanting to give me a job. The government would pay us to attend university! They’d find you a job in the holidays. Tell that to the younger generation these days and they won’t believe you!

  46. Will
    February 24, 2015

    All very well but the younger generation can only benefit from lower interest rates if they can afford a property. If interest rates are at a new low norm why are salary to mortgage multiples stuck at four or five, and how does that help buy an average property at ten times average earnings.
    If a government is serious about higher home ownership rates then existing home owners will have to take a hit to their equity either relatively or absolutely.

    1. A different Simon
      February 24, 2015

      I remember the first time I saw a “starter home” twenty five years ago .

      Confining people in such a tiny space must surely alter their behaviour if not outright cause psychological problems .

      What a great way to smash peoples aspirations and impress upon them their rightful place in the world .

      I suspect may of them will subconsciously subordinate themselves to their much more self confident betters who had the advantages of fee paying schools etc .

  47. Max Dunbar
    February 24, 2015

    The second last paragraph sounds good.
    We don’t need state interference and re-distribution of confiscated ‘wealth’. Families do, by and large, support one another across the generations and we are far more adaptable to changing conditions than rigid government policy will ever be. Just leave us alone to get on with it and keep the grubby paws of greedy and hubristic politicians out of our pockets.

    The last paragraph makes sense in the run-up to an election where most of your support will come from older traditional Conservative voters. This is particularly relevant in Scotland, despite much devolved legislation in these matters, because only people beyond a certain age have not been relentlessly brainwashed by the Far-left propaganda machine of Labour and its SNP bedfellows.

  48. Mondeo Man
    February 24, 2015

    There should be free TV licences for EVERYONE not just the over 75s.

    BBC bias is a disgrace and their output it not up with the likes of HBO. Discovery do really good science programmes and Sky are cornering sport.

    1. Mondeo Man
      February 24, 2015

      Not to mention The History Channel without the usual lefty slant.

      1. Dame Rita Webb
        February 24, 2015

        Eh? Every time I switch it on their always seems to be something on about Hitler!

  49. bigneil
    February 24, 2015

    My concern is all the people who will be “entitled” to a pension – just for having arrived here. If they can have a free life – why shouldn’t we – the people who have paid in taxes? or is the govt practising blatant discrimination against the English?

  50. PayDirt
    February 24, 2015

    Both old and young generation are reliant on a stable economy, that is the UK economy and more broadly the global economy. The UK Government fiances itself (pays pensions, benefits, NHS, education, defence etc and gives priority to whichever) by selling interest-bearing bonds. Recently the BOE, supposedly independent, has bought loads of Govt bonds from whoever, eg private pension funds and called it QE. The theory is that the bodies which sell the Gbonds, deposit the new money in the regular banks from where they decide what to invest in (instead of Gbonds they used to hold). So up go asset prices. The endgame of course is for the BOE to write off the Gbonds that they bought with QE money, hence the Govt debt will to reduced and we can all keep on benefiting from the Govt’s largesse. However, the younger generation may have to pick up the pieces if this ruse brings about devaluation of the currency, which hasn’t happened yet but sort of depends on the global balances to come. So the old get to die and the young can carry on enjoying life. The main thing is to avoid war where lots of the young will die before their time.

  51. Joseph
    February 24, 2015

    How about we get rid of all these supposed allowances and just pay a proper pension. The tax and benefits system needs reform, simplify it and we’ll save even more money.

    1. Lifelogic
      February 24, 2015

      Exactly people what to choose how they spend their pension money not be forced to take free bus rides or watch free tv!

      1. William Gruff
        February 25, 2015


        That is precisely the sort of dangerously subversive talk that leads to democracy.

        People deciding for themselves how best to spend the money they earn? Good God! Whatever next? People running their own lives without an army of bureaucrats and cretinous hi-vis clad goons telling them what to do, that’s what , and we don’t want that now, do we?

  52. Colin Hart
    February 24, 2015

    Benefits for pensioners have one thing in common. They are based on a popular assumption that because you are old you are necessarily poor. We all know this is not true.

    Many people are in fact better off once they have retired than they were when they were working; mortgage paid off, no job insecurity, no child costs.

    There is no rational justification for free bus passes, free TV licences and the winter heating allowance for any pensioner in the higher rate tax bands. The TV licence and the heating allowance should be clawed back through the tax system. You couldn’t do that with the free bus pass but the issue probably does not arise as it is unlikely to be used by many pensioners paying higher rate tax.

    However, no political party is likely to do any of this as they are all too scared of losing the pensioner vote.

  53. English Pensioner
    February 24, 2015

    There was a recent report that suggested that the CPI is not representative of the higher rate of inflation experienced by most pensioners. Pensioners spend a higher proportion of their income on food and heating. They spend far less on petrol, if they still run cars, and haven’t experienced any significant benefits from the recent fall in oil price. They don’t spend so much money on the latest electronic gadgets, white goods and the like which have fallen in price in relative terms. They do spend more on services like dentistry, opticians and chiropody, the later being a significant expense for some pensioners as it is not available on the NHS. They also tend to spend more on “over-the-counter” medicines for minor problems. In addition, those of us who are home owners frequently have to employ people to do routine tasks that we would once have done for ourselves, and their charges seem to be outstripping inflation, if you can manage to find someone to do the work.
    I’d rather have a pension where the indexation is to the pensioners’ inflation index and would then happily forgo the extra allowances, but I suspect that this would cost far more.

    1. Qubus
      February 25, 2015

      Good idea. Let’s have an OAPCPI.

  54. ian wragg
    February 24, 2015

    John, CMD has only voted to preserve our “benefits” because ther are 12 million of us and most of us vote. The fact that they pensions are taxable means they are not benefits and are a universal right.
    I paid tax and national insurance for 48 years including 20 plus years working overseas when I had no entitlement to benefits , NHS or anything else. The documents which I still have state quite categorically that the N.I. was to qualify for the state pension.
    Yes, I am well off but this is down to prudence and denial when younger. I do not feel one iota of guilt now I receive (taxed) state pension.

  55. stred
    February 24, 2015

    Reading the Green manifesto, it is disappointing that they have not implemented their conference idea to legalise cannabis. However they plan to break up Tesco and other big supermarkets and nationalise outer space. Our electricity, heating and transport will all have to come from wind, wave and tides as they have decided not to import biomass from the rest of the world. And just to make sure we freeze and go back to pre-industrial days, they will have no nuclear either.

    1. Dame Rita Webb
      February 24, 2015

      Take a walk through any city centre on a Saturday afternoon, Bristol and Manchester spring immediately to mind, and you will discover that smoking cannabis has already been de facto legalised.

    2. DaveM
      February 24, 2015

      Don’t forget their defence policy. To quote from a 1980s comedy show – they intend to grow a very tall hedge.

    3. Bazman
      February 24, 2015

      Legalise it like chewing gum would not be a good idea. I speak from experience of this time wasting anti social drug, that causes so much unemployment by massive demotivation of mainly young people, but to quote Bill Hicks. Its not a war on drugs it a war on personal freedom. So true.

    4. William Gruff
      February 25, 2015


      … And just to make sure we freeze …

      Thus solving the problem of a growing population of old people. No need for heating supplements and bus passes then. Brilliant.

  56. Gumpy Goat
    February 24, 2015

    We must invest in the future, although I am about to be one pensioners should face means tests to see if they are entitled for further benefits such free TV, bus passes. Set the cut off limit than higher that one gets for other means tested benefits though. Invest the money saved in education and science and technology

  57. David L
    February 24, 2015

    Where the system breaks down amongst people I know, is when the marriages of the younger generation break up and the assets of the oldies get dissipated more rapidly by the need for buying/renting multiple dwellings and supporting adult offspring who have no assets of their own.
    Sorry for that long sentence!
    Now in retirement myself, I often think how lucky I am to have benefitted from my parents financial responsibility. I only hope I’ll be able to pass a reasonable legacy on to my own children. But how they’ll afford decent housing themselves is a worry.

  58. Stephen Berry
    February 24, 2015

    People in the UK are wealthier than people in a country like Rumania, because they have accumulated more capital than the Rumanians. In a reasonably well run and stable economy, capital gradually accumulates. This results in an ever increasing standard of living for each generation that is born. The present younger generation have done absolutely nothing to deserve being born into an advanced economy with high capital accumulation, but neither had I when I was a member of the younger generation. Each person who produces and saves does his or her bit to continue this process and future generations will be grateful for this. That’s the real generation game and everything else is a sideshow.

    At any one time there is give and take between generations. Much of this is given on a voluntary family basis and that’s how it should be. That parents, who have spent a whole lifetime working and accumulating, want to pass some of their savings on to their children is only natural and the state should place no hindrances in the way.

    What role should government play in shifting money between generations? None at all in my view. People need to realise that state pensions, ‘free’ bus passes and TV licences come out of present taxes and help to ensure that the people who now pay these taxes will in turn be reliant on the state in old age. This is a self-perpetuating process which increases the power of government and results in pensions which are lower than might otherwise be expected.

  59. yulwaymartyn
    February 24, 2015

    JR – off topic I know but I do like to ask you this question from time to time:

    When do you think interest rates will rise in the UK?

  60. Roy Grainger
    February 24, 2015

    The free TV license is an odd one. Wouldn’t be bothered if that one was removed, likewise the TV license itself.

  61. graham1946
    February 24, 2015

    I don’t mind the pensioners having their benefits, (have you noticed the politicians are starting to call the retirement pension a ‘benefit’ now, so won’t be long before they start wanting to cut this as well) but the thing that really winds me up is that they get an extra 25p per week just for tuning 80! Why do they need all this? I bet they just waste it on a two or three slices of bread or something equally extravagant.

  62. Jon
    February 24, 2015

    I think the young have taken a big hit with the debt built up by Labour though interestingly enough, seem to be more individualistic rather than the older generation looking for the collectives. For them I see that as a positive thing for them and the nation as a whole though will present a problem for the likes of Labour and the unions.

    Labour this time round are not just looking at further debt but taking from savings. Ed Balls apparently is interested in reducing the pension lifetime savings limit and also the limit on how much can be paid in to fund a reduced tuition fee. Those on public sector pensions are less affected by that as the limits are far more generous as they are based on the pension itself.

    I like the Conservatives approach to dealing with inter generational transfer compared to other parties.

    I would like to see the MP’s pension (and FCA, PRA) converted to a money purchase to reflect the same basis that most of the working population have. It would better focus our legislative and regulative thinking if they saw what delivers better outcomes for their own pension. At the moment they mix defined benefit tax payer funded thinking to the money purchase that does not help those with money purchase plans. Lets be in it together.

    The moves by the Treasury to allow more pension funds to potentially be passed down is a good move. Ed Balls’ idea could cause further distrust of saving into pensions.

    1. sm
      March 3, 2015

      Why not have a cap on the ‘capital value of a public pension’. Say £1m!
      Want more?Leave the public sector.

      Fairness between generations..mm.
      Move to 100% reserve banking. Government should transparently sspend & tax money into existence. Banks should not be able to create out of thin air money.

      Try and maintain a stable population, helped by not trying to push a debt driven ponzi for the benefit of a few.

      Keep borrowing per capita in check. And stop mass immigration.
      Ensure the unemployed are able to find work, even if by publicly funded infrastructure repairs of roads etc.

      100’s of genuine job seekers applying for one role is NOT ACCEPTABLE. Long term unemployment is NOT ACCEPTABLE.

      Train up our own Doctors and Nurses and use contracts to ensure they repay amounts if they choose to leave public service before a sensible period of

      Give us a vote on the EU? Which generation voted for it?

      Maybe a land value tax? and more balance between capital and income taxes.

      I despair with the LibLabCon.

  63. mike fowle
    February 24, 2015

    The young have much greater scope to plan for their old age; the old have to make do with what they have. The old deserve to be treated well – if you tailor your civilisation to suit the young, you will end up with an infantile society.

  64. Bazman
    February 24, 2015

    What is this present government doing encourage marriages with forty year plus age gaps to give sensible and moral solution to the problem of intergenerational financial strife?
    A cursory look at the internet will see there is great attraction by both sexes and generations for each other and is well documented.

  65. Iain Gill
    February 24, 2015

    It’s not so much between the generations as between the prudent and the feckless. The over borrowed have had countless bail outs. The massive money printing has devalued the currency and the value of savings. House prices have had constant hyping, with lots of massive state manipulation. Too many markets have been rigged by the government, the natural cycle of corrections has been bent by constant manipulation. We would have been better off doing an Iceland and had a big correction from which we could restart.
    It’s also between those lucky enough to live in a catchment areas of decent schools, GP’s and other public service provision. The difference in value between the best and worst state schools is massive. The high tax payer in a poor catchment area is cross subsidising the feckless in the good catchment areas. The worst of all possible systems, school allocation based on house prices, no selection on merit just parents wealth.
    It’s also between the legal, decent, honest citizens and those abusing the systems and other members of the community.
    As for the old, well in England they often have their hard saved for wealth taken by the state to pay for their old age care, selling their houses to fund care home places while those who have not been prudent are fully funded. Again putting completely the wrong incentives in the system. Meanwhile the powerful put their houses in trust funds to stop this robbery which they regard as just for the little people.
    It stinks

  66. Kenneth R Moore
    February 24, 2015

    We talk of fairness. What is fair about a single generation of ‘elites’ that has :-

    -Forced a settled population to compete with millions of extra citizens for roadspace, housing, NHS treatment etc. without ever asking for permission.
    -Accepted the doctrine of political correctness
    – Given away our democratic birthright to a German led racket called the Eu destroying centuries of self government and democracy. Thanks for that John Major, Gummer, Rifkind et al………..
    – Squandered a golden legacy of north sea oil, gas and coal.
    -Overseen a disastrous experiment in globalisation that has destroyed knowledge, skills, communities,facilities and the dignity of the working man and woman
    -Overseen the death of a large tranch of our manufacturing industries (without a corresponding decrease in consumption) leaving us like the emperor with no clothes.
    -Fostered a benefits culture of entitlement
    -Infantilised the unemployed and sick for political reasons
    -Manipulated interest rates and the bond markets causing asset bubbles in housing and other commodities to create an illusion of growth.
    -Said or done anything just to get elected for another 4 years and the heck with long term interests..
    -Saddled us with , inefficient and unaffordable public services
    -Been busily destroying money as a store of wealth

    -etc. etc.

  67. rick hamilton
    February 25, 2015

    As one who trained in engineering and benefited from a university education courtesy of my employers I feel sorry for young people who have to pay for their own degree courses. The company with which I did my 5 year apprenticeship, one of the finest courses available anywhere at the time, no longer exists. Its remnants have been sold off to foreign ownership and dozens of its suppliers, in those days household names, have suffered the same fate.

    Has anyone ever calculated how much corporation tax, business rates and employee income tax etc our great manufacturing industries generated in their heyday (the 1960s) ? I doubt that the City – with its abstruse skills of playing with other peoples’ money instead of producing tangible products that people actually need – would come anywhere near it. But I really would like to know.

  68. Mockbeggar
    February 25, 2015

    The Winter Fuel Allowance should be taxable. Just add it to the pension and include it as pensionable income. That would be much cheaper than means testing it.

    When it comes to selling one’s home to pay for residential care, I can’t help feeling that I have no right to expect the state to house me so that I can pass on my house asset to my children. The house is a form of saving for a rainy day and moving into residential care is a rainy day. I say this reluctantly as you might imagine.

  69. Ray G
    February 25, 2015

    Effectively, winter fuel payments are an increase in pension at certain times because the government does not trust pensioners to manage their affairs properly. As a temporary increase in pension I see no reason why one should not have to declare it to HMRC and pay tax at one’s marginal rate. Those with insufficient income to pay tax would benefit from the full payment.
    However, I wonder if bus passes are the excessive cost to the country as seems to be imagined by your correspondants. Travel with pensioner bus passes is limited to off-peak times when buses are usually empty. I suspect if pensioners had to pay for their bus travel far fewer journeys would take place. However, bus companies would still incurr the costs of running the service. Either the government would have to continue to pay the bus companies with a subsidy rather than a compensation for providing a service to pensioners or the peak time commuter would have to pay more.
    I find I watch television for only a few hours per week and resent having to pay the BBC for something I don’t watch and when I do it seems biased towards unbalanced environmentalism and left-wing liberal agenda. Declared interests: I am a tax paying pensioner.

  70. Narrow Shoulders
    February 25, 2015


    What you say is correct but you are effectively being punished for going without, being responsible and saving for that rainy day. Those who were not responsible just get it paid for them.

    You should not expect the state to look after you so why should they?

    One rule for all, the state either pays or it does not. If it did not your fees would be a lot cheaper.

  71. Andy
    February 26, 2015

    “They also now have the benefit of very low inflation, compared to the rates we were used to in the 1970s and early 1980s.”

    Why is not have your mortgage inflated away a benefit? What is never mentioned is that people were also get pay rises in-line or above inflation during this period.

  72. a-tracy
    February 26, 2015

    What is the uptake on bus passes outside of the M25 compared with inside the M25?

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