Intergenerational Fairness in Government Policy

Lord Best Excerpts

Thursday 26th October 2017 Lords Chamber

[Lord Best (CB)]

My Lords, as the noble Baroness, Lady Smith of Newnham, has noted and as the noble Lord, Lord Willetts, explained so well, the obvious manifestation of intergenerational unfairness in the UK is found in this country’s housing circumstances for young and old. Clearly, the UK needs to redress the imbalance between, on the one hand, the majority of those over 60 who are home owners with a substantial capital asset, security, and more than adequate space and, on the other hand, the majority of those under 40 who have the heavy burden of paying a disproportionate amount of their income for accommodation that seldom suits their needs. Yet the successive deep cuts in housing support to those on the lowest incomes are hitting the under-35s hardest of all. However, today, counterintuitively, I am going to suggest more support specifically targeting older people, rather than advocating brave but vote-losing measures that tax or penalise them.

Much of this country’s housing comprises three and four-bedroom suburban houses with gardens, occupied by one or two elderly people. This accommodation will become increasingly problematic to manage and maintain and, with its steps and stairs, increasingly inaccessible. But where are the spacious, light and airy homes that are easy to heat and maintain, in convenient locations, and designed with older people in mind? Only when demand is stimulated and supply is generated will those of us in our extended middle age take the plunge and rightsize before a crisis forces us to move. Such a move would free up the family homes that the next generation so badly needs.

I strongly commend the measures devised by the All-Party Parliamentary Group on Housing and Care for Older People, which I co-chair with Peter Aldous MP. The APPG has set out a three-part help-to-move package to change attitudes and behaviours. We propose, first, stamp duty exemption for purpose-built, age-exclusive housing; secondly, equity mortgages to top up purchase costs for older people, as Help to Buy does for the young; and thirdly, good financial advice on housing from an extension to the Government’s Pension Wise advisory service.

Helping and incentivising older people to rightsize to new accommodation could contribute massively to intergenerational fairness by releasing significant numbers of family houses on to the market, as happens in so many European countries, the USA and Australasia. Even sales of expensive homes have a knock-on impact that works its way down, releasing property for those on the lower rungs of the ladder. It would also inject some momentum into the stagnant wider housing market, with the economic stimulus of an average of three subsequent movements down the property chain. HM Treasury, although forfeiting stamp duty on the new homes bought by older people, would collect far more stamp duty from the three other movers. So the help-to-move package would cost the Government nothing.

In addition, there would be significant savings to health and social care budgets. Hospital admissions frequently follow accidents in the home; subsequent delayed discharge—bed-blocking, as it is horribly called —is often caused by people being unable to leave hospital or being readmitted because their home cannot take them back. Admission to expensive and unpopular residential care can be prevented or postponed when people move to accessible, care-ready new housing.

Rather than risking the wrath of the electorate with sensible but politically problematic measures, I ask the Minister to lead the charge in backing a help-to-move package which would lead to the redistribution of housing from old to young and free up resources for the NHS and local authority care budgets. This could be the winning formula for some real intergenerational fairness.