Pensioners today get a hard time. They’re blamed for living it up in their youth, buying cars and houses, and supposedly leaving their children and grandchildren with nothing.
This penchant for demonising pensioners was given a new lease of life this week with the publication of the latest Resolution Foundation report, As Time Goes By, on ‘shifting incomes and inequality between and within generations’. The Resolution Foundation claims that the ‘living standards of the typical pensioner after housing costs have actually been higher than those of the typical non-pensioner’. In other words, as the BBC put it, ‘pensioner incomes outstrip those of working families’.
The Boomer-bashers have responded with outrage. ‘The Baby Boomers have enjoyed the good times – now a tax hike is due’, wrote the Guardian’s economics correspondent Phillip Inman. ‘This group of Baby Boomers worked for employers with generous guaranteed pension schemes and can now enjoy several holidays a year, a 4x4 in the driveway and provide a deposit for their grandchild’s first home.’ This might be a good thing, Inman argues, if it weren’t for the fact that the Boomers’ prosperity is ‘fuelling inequality between generations’. In order for the younger generation to be better off, the argument goes, pensioners are going to have to stop enjoying their retirement and lead more frugal, miserable lives.
This argument is all too familiar. In recent times, pensioners have been attacked for living too long and becoming a healthcare burden; they have been blamed for high house prices and rent inflation, with their critics even calling for the downsizing of pensioners’ homes; and they have been slammed in general for consuming more than is their rightful share. A 2015 report by the Intergenerational Foundation concluded: ‘While increasing longevity is to be welcomed, our changing national demographic and expectations of entitlement are placing increasingly heavy burdens on younger and future generations.’
This demonisation of old people has got to stop. For a start, the idea that pensioners are thwarting younger generations’ chances at a good life is simply untrue. The Resolution Foundation report makes clear that pensioners’ income is higher than those of a working-age only after household costs. Before household costs, those of working age actually have a higher average income than pensioners. This is hardly surprising – pensioners have had the time to save and pay off mortgages while people of working age continue to spend money on housing costs.