In March 2018 the Intergenerational Commission, in partnership with My Life My Say, convened a group of 30 young people to discuss issues related to intergenerational fairness. The Commission wanted to understand where their greatest concerns lay, and to test some of its policy ideas against the scrutiny of today’s young generation as part of our wider call for policy submissions.
Below we detail some of the key issues that came up in our discussions, which we kicked off with Commission analysis to set the scene. Smaller groups then discussed the issues before hearing from a young councillor and having the opportunity to feedback to the room.
Round one: Housing & home ownership
There was broad consensus that it is increasingly difficult for young people to buy a home. One participant stated that “in the UK your main asset is your house”, while others viewed housing as “a replacement for a pension” or a “way to transfer wealth after death”. However, it was noted that the tendency to see housing as an investment, rather than as a place to live, has contributed to the increasing cost of homes.
Several participants raised concerns about wealthy investors buying up homes in London at inflated prices and leaving them empty, making it harder for people who actually want to live in them to afford them. There was support for the taxation of empty homes. One participant noted that homes were being advertised abroad prior to being built and suggested that developers in the UK housing market are primarily targeting wealthy overseas buyers. Suggestions to counteract this included banning overseas buyers or giving local people the chance to buy a home first, before the opportunity is opened up to overseas buyers.
Housing costs in general were also thought to be too high. One participant spoke of having to work while studying for his A Levels in order to help his parents pay the rent, while others claimed that renting in the private sector while studying was a major cause of anxiety for students. Another participant stated that rents in London are exceptionally high when compared to major cities in other countries. It was claimed that rent controls have been effective in keeping the cost of housing down in Germany, where renting is considerably cheaper.
The quality of the private rental market was another key area of concern. One participant suggested that “if the private rented sector was affordable and good quality, people would want to live in it”, while another claimed that “security of tenure is more important than owning your own home, but you can only get security of tenure in social housing which is only available if you’re in a really desperate situation”. It was suggested that more social housing needs to be built, particularly for young people who struggle to afford market rents and find themselves at the cheaper, and as a result poorer quality, end of the private rented sector.
There was broad support for better regulation in the private rented sector and for more to be done to tackle “dodgy landlords”. It was noted that some student unions are creating tenancy unions and letting agencies via which only landlords that pass a quality framework test (which is created and audited by students) are allowed to advertise. Landlords that are not on these websites struggle to fill their houses. It was suggested that a similar policy could be implemented outside of universities.
Round two: Jobs & income
The group recognised that it is not difficult to find a job in today’s labour market, but there were concerns about the types of jobs that young people are doing. One participant claimed that “it is easy to get a job, but not a well-paid job”, while another stated that young people are now doing “less meaningful jobs”. Most of the breakout groups spoke about the regional distribution of jobs, with participants largely of the opinion that jobs in the most attractive sectors are mainly concentrated in London. One participant claimed that this is the result of not enough attention being paid to ‘working class’ jobs.
While most of the participants were university graduates, many had not found jobs that matched their skills or educational profile. In one breakout group, not a single participant was working in the field they had studied in. There was dissatisfaction around the need for two to five years of experience for entry level jobs as the group felt that this experience is very difficult to gain without taking unpaid work, which is only feasible for wealthier graduates. The group agreed that there need to be clearer pathways into different sectors and that education provision needs to be more aligned with the job needs of the country.
Among non-graduates there was a sense that their qualifications and experience are of less value in the labour market. Participants spoke of a stigma of not going to university and one person shared their experience of “doing an internship at a large corporate firm for four years, on terrible pay, and still being treated badly for not going to university”. Others claimed that this stigma combines with racial and gender discrimination which makes it harder for them to progress in work. They were in support of the adoption of blind shortlisting and age-blind recruitment.
Concern about progression was also widespread, with one participant suggesting that “people get comfortable in bad retail jobs in which they have basic security but can’t progress”. The group suggested that there should be a right to a sector-specific progression plan for new workers.
Many of the participants did not know what a starting salary should be or where to find this out. Many admitted to “just accepting what they were given”. One participant claimed that the starting salary of the graduate scheme in their workplace had not changed for eight years. Another suggested that young people were just accepting low salaries with the promise of basic security as a standard of acceptability.
Several participants said that they did not know how to, or have the confidence to, negotiate their pay – either for pay rises or at a job interview. One person claimed that they “wouldn’t even think to do so”. A number of participants put this down to gender or social class disparities – they suggested that men or “better-off people” would be more likely to negotiate their salaries.
Round three: Welfare state
The group largely agreed that pensioner benefits should be means tested – one participant suggested getting rid of winter fuel payments for wealthier pensioners. However, the group also recognized that this may create a large admin burden for the state and there was general agreement that, instead of means testing, pensioner benefits could operate on an opt-out basis, such that those who do not necessarily need the benefits can choose not to take them up. They suggested that this could be incentivized by linking the money saved from opting out to benefits for less well-off younger people. Much of the group were also anxious about their own futures. They worried that young people could not access the same pensions that their parents could, and that state pensions would either be gone, or offer very little, by the time they retire.
Some participants were concerned about support for young people from low-income backgrounds that do not have children. This group are largely excluded from benefits, aside from jobseeker’s allowance, but many that struggle do not necessarily qualify for unemployment benefits. There was support for more in-work benefits which may enable people in low-skilled sectors to spend part of their week reskilling so that they can move into better paid work. The group also recognized that many young people are now spending longer periods in lower-paying jobs after training or university and suggested a buffer period in which they are supported to meet basic costs, such as travel, to enable them to get to job interviews or to support them as they gain experience.
Many participants stated that they weren’t aware of where to go to receive state support or in which circumstances it would be available to them. They stressed the importance of financial education with a focus on taxes and benefits. Others noted that there are great disparities in public services across the country, they claimed that there are many great local initiatives to help people but these are not connected up to the national infrastructure.
In terms of taxes, people were concerned about the high cost of council tax and it being poorly targeted. Others were keen to see a better system of inheritance tax and a proper impact assessment of it. They were concerned that it is not properly implemented and that there are too many loopholes. However, many were also wary of excessive wealth taxation. They acknowledged that their parents’ generation had worked hard to buy their homes, with a view to passing them down the generations, and suggested limits on how far wealth is taxed. There was also concern that wealthier families are more financially literate and capable of exploiting loopholes, and that this would mean less wealthy people end up paying more in wealth taxes.
The group exhibited a broad range of viewpoints that reflected a diversity of experiences, but their concerns were largely shared. For the Commission, it was encouraging that many of the issues raised echoed insights from our analysis. Moreover, we found broad support among the participants for a new policy agenda which places intergenerational issues at its core. We have reflected on their comments and suggested solutions, alongside those submitted to our call for evidence, as we have developed a policy package to renew the intergenerational contract. This will be published next Tuesday in the final report of the Intergenerational Commission.