From the triple lock to TV licences, are older voters benefiting at the expense of the young?

The voting power of pensioners has long had a distorting effect on British politics.

Behind almost every other divide outlined in these pages lies a deeper one: the growing gulf between young and old. Britain’s over-65s are less likely to be graduates than the younger generations, more likely to be homeowners, more likely to be white and more likely to believe immigration is out of control. All that affects how they vote; and, boy, do they vote: 78 per cent turned out in the 2015 general election, against 66 per cent across the population. Ninety per cent of them cast a ballot in the June 2016 referendum, where they were twice as likely as the under-25s to have voted to leave the European Union.

The present generation of pensioners is swelled by the ranks of the baby boomers, those born in the two decades after the Second World War. Not unreasonably, they feel that they were promised a comfortable retirement if they worked hard. The problem is that their lives have been much better than anyone foresaw: they have higher life expectancy and greater wealth than any generation before them. That throws out the cold, actuarial decisions that govern pension schemes and social-care funding.

The generations before the boomers didn’t have it so good. At the start of the 1990s the pensioner poverty rate was 38 per cent, compared to the child poverty rate of 31 per cent, according to the Joseph Rowntree Foundation. But New Labour’s quietest achievement was a steep fall in the number of older people living in low-income households. By 2013-14, 14 per cent of them did so, and today pensioners are less likely to live in poverty than any other group. It doesn’t make sense to talk about “pensioner poverty” in the way we once did. Indeed, when, after taking over as Prime Minister, Theresa May spoke of the divides in Britain, she name-checked the gap between a “more prosperous older generation and a struggling younger generation”. But will she do anything about it in 2017? It’s unlikely. The voting power of pensioners has long had a distorting effect on British politics.

And so there are sweeteners, large and small: free TV licences for the over-75s (which cost £650m a year), for instance. Can’t pay the bedroom tax? Reach state pension age, and you become exempt.

The costs to the Exchequer can be significant. The winter fuel allowance costs £2bn and is available without means-testing, even to the 106,000 British expat pensioners eating tapas in sunny Spain. In 2013, Iain Duncan Smith said: “I would encourage everybody who reads the Telegraph and doesn’t need it to hand it back.” In 2015, out of 12 million recipients, just 29 did.

The crowning jewel of intergenerational unfairness, however, must be the “triple lock” on state pensions. These rise in line with average earnings, the consumer price index, or 2.5 per cent – whichever is highest – leading to an increase of £1,100 a year since 2010. By comparison, George Osborne announced a two-year freeze on public-sector pay that same year. In effect, once inflation is taken into account, there have been pay cuts for millions of public-sector workers, and a similar squeeze in the private sector.

This has led to stirrings of conscience over intergenerational fairness. In November, the Commons work and pensions select committee recommended that the triple lock be ditched and replaced with a simple peg to average earnings. “Fairness now means that the pendulum swings back in favour of working families, so they do not continue to have cuts – real cuts – in living standards, while we further advance the interests of pensioners,” said Labour’s Frank Field. The Department for Work and Pensions immediately reaffirmed its commitment to the lock until 2020. John McDonnell, the shadow chancellor, went further, pledging to continue it until 2025.

It is hard to talk about generational divides, because the debate gets stuck around phrases such as “I’ve paid in all my life”. But it is increasingly clear that even those from younger generations who “do everything right” will still face a challenging future. In July, a Resolution Foundation study reported that millennials aged between 15 and 35 could be the first generation to earn less than their parents over their lifetime. Fewer workers will be expected to support a growing number of the retired: by 2050, there will be 2.9 of the former to every one of the latter, and a quarter of the UK population will be over 65. Currently, younger people are content – or at least, not rioting – to pay taxes to support public-sector pensions that are far more generous than anything they themselves can expect to receive. (Private final-salary schemes that are open to new entrants are now vanishing. Less than 10 per cent of private-sector employees are in a final-salary pension scheme.)

The optimistic answer to all this is that parents and grandparents want the best for their families and will therefore be happy to make sacrifices for younger people. Unfortunately, the Brexit vote has put paid to that theory: the older generations did not give up their Leave tendencies just because their children wanted to remain. This debate is mixed up with a deeper cultural anger that is hard to analyse but easy to spot. It’s about who “deserves” help; who is entitled to government assistance; and, if it’s a zero-sum game, at whose expense. Look what happened in 2011 when the Intergenerational Foundation mildly suggested that empty-nesters should downsize, freeing up large houses for young families. You’d have thought it had suggested compulsory euthanasia at 60. “The elderly are perfectly entitled to hoard their housing,” roared the Telegraph. At the other end of the political spectrum, Spiked magazine declared in 2015: “Granny-bashing has become twentysomething politicos’ default setting.”

It is an overwrought response, particularly when so many older people have benefited from soaring house prices since the 1970s. “This concentration of wealth in one lucky generation, and more specifically among the better-off part of that lucky generation, will have profound consequences for generations to come,” wrote Paul Johnson of the Institute for Fiscal Studies. “The wealth won’t disappear, it will be passed on to their children and grandchildren. Increasingly people’s economic well-being, especially in retirement, will be determined . . . by the wealth of their parents.” Johnson was asking a question the rest of us should also face: is it time to break our promises to pensioners?