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Tackling Intergenerational Unfairness (Select Committee Report)

Thank you. I first declare an interest as set out in the register. I am delighted to open this debate on behalf of my noble friend Lord True, who was chair of the committee. Due to his good work, he is now a government Minister, which should be a warning to all of us. The committee comprised the noble Baroness, Lady Bakewell, the noble Lord, Lord Bichard, the noble Baroness, Lady Blackstone, the noble Viscount, Lord Chandos, the noble Baroness, Lady Crawley, the noble Baroness, Lady Greengross, the noble Lord, Lord Horlick, my noble friends Lord Holmes of Richmond and Lady Jenkin of Kennington, the noble Baroness, Lady Thornhill, and, last but not least, the noble Baroness, Lady Tyler of Enfield, who proposed the committee. On behalf of my noble friend Lord True, I thank all noble Lords for being on the committee and for their service. I also, on behalf of the committee, thank the officials: the clerk to begin with, Judith Brooke, and then Olivia Crabtree; Tim Stacey, Hannah Murdoch and our special adviser, Professor Jane Falkingham from Southampton University. Of course, on behalf of the committee, I also thank all those who came to give evidence.

The debate on the intergenerational fairness report, although late, is now more prescient. Its good intention came from wanting to examine the impact on the

different generational cohorts in the decade that followed the financial crisis of 2008 and to recommend actions if required that would ensure a more equitable contribution to society going forward. It is worth remembering that, at the height of the financial crisis in 2010, the Government borrowed £150 billion in that financial year and that, in spite of tax rises and public spending cuts, our national debt rose from around £500 billion in 2007 to £1.8 trillion in 2018. In this financial year, the Government will borrow around £450 billion—three times the level of the peak of the financial crisis in 2010—taking our national debt to £2.1 trillion. Next year there are forecasts of another £200 billion of borrowing.

While some will argue that servicing this level of debt with low interest rates is affordable, it is worth remembering that our national debt repayments are currently the fourth-highest area of government spending. The Government in time will need to address our country’s debt and borrowing and, when they do, I hope that they will revisit this report and ensure a fair proportion of the repayment burden falls across all generations. I am delighted that the Office for National Statistics accepted the committee’s recommendation and is now reporting new intergenerational analysis and looking to do more. Only by having and sharing this data can we achieve the broad equivalence and fairness of contribution and receipt by each generation that the committee wanted to achieve.

The committee highlighted six conclusions: on data, housing, active communities, tax and spending, and two on the younger generation. It is on these final areas that I will focus my remarks. It was clear from the evidence we received that, post the financial crisis, pay progression for those in their 20s slowed compared to that of previous generations, and employment became less secure, with more temporary work, zero-hours contracts and unskilled work. As a consequence, it is now unlikely that this group will enjoy the generation-on-generation income gains seen in the past.

Furthermore, housing became more expensive and difficult for young people to buy as a result of QE, which made money cheaper for the older and more stable in society, fuelling house and share price growth. Looking to today and our handling of this pandemic, we see stamp duty temporarily suspended and QE again boosting house prices by circa 7% in 2020, once again making it even harder for those joining the labour market to afford a home of their own.

The pandemic will lead to more flexible working: two-thirds of employees completing the Happiness@Work survey said that they wanted a mix of office and home working, while 18% of mainly older employees do not want to return to the office at all. In the same research, under-29s were concerned for their career development and training in lockdown and beyond, and young managers were far less happy than their older counterparts as training, advice and guidance are now less easy to receive, as middle management is stripped out and work pressures increase.

Jobs in hospitality and retail have been decimated—sadly, we have seen more evidence of that again today—and these are often places where the young start their careers. As the report points out, there is also a need for more structured mid-career training to help employees

adapt to the new world, and that is true now more than ever. And, with unemployment predicted to rise rapidly, there is a need to get the young who are leaving school and university into work, as well as on in work. For example, schemes such as Kickstart should be welcomed, but they need to be more available to SMEs if they are to make a substantive impact.

So now would be a good time for the Government to reassess the work of the Intergenerational Fairness Committee and the recommendations in its report. I beg to move.

2.56 pm