Intergenerational Fairness in Government Policy

Lord Wallace of Saltaire Excerpts

Thursday 26th October 2017 Lords Chamber

[Lord Wallace of Saltaire (LD)]

My Lords, this has been an excellent debate, and the speech we have just heard is a very good example of the high quality and of different experiences being brought to bear in this House. It was very good to hear the noble Lord, Lord Willetts—The Pinch was the starting point for many of my thoughts on this subject, probably some years ago now. I too was surprised by the absence of Labour speakers. I am told that Labour is a party that cares a great deal about equality, and this is one of the underlying issues to do with equality and inequality in this country. I was glad that the noble Lord, Lord Lamont, sat and listened at least to the opening speeches in view of his article in last week’s Daily Mail, in which he said that,

“the very idea of intergenerational inequality is bunk”;

indeed,

“it is one of the silliest political concepts ever conceived, and yet it has been taken up with manic enthusiasm by ... the Resolution Foundation”.

I worry about the Daily Mail, which has four pages today attacking universities and intellectuals. It is a newspaper which attacks immigrants all the time, attacked judges the other month, attacked a major international organisation, the OECD, last week and now attacks intellectuals this week. I wonder who it will go on to attack next and begin to wonder when the Conservative Government will have the courage to stand up to this hysterically reactionary newspaper and defend the concept of open debate and free speech.

The Social Mobility Commission talks about three overlapping problems of inequality in the United Kingdom: that between rich and poor, that between London and the poorest regions, and that between the old and the young. I was struck last week, on seeing a graph in the Economist on OECD figures for the gaps between the richest and the poorest regions in major countries, by how Britain stands out for the gap between London and the south-east and places such as Yorkshire and Lancashire. That is something we should also worry about, and it is why Members of this House such as me begin to go on more and more about the problems of the north and the imbalance in public spending between London and the south-east and the north.

Returning to the question of intergenerational inequality, I am glad that a number of noble Lords emphasised the extent to which growing longevity alters the nature of the equation. This House is, after all, a perfect example of that. When pensions were introduced in 1911, the average life expectancy was 57, and the pensionable age was 60. A welfare state of that sort was therefore easily affordable. When the National Health Service was introduced after the Second World War, life expectancy was a little higher—although not by too much—and there was not much you could do about people with a range of conditions for which many of us in this House have already been treated by the NHS. The situation has been changing and, as we have a higher and higher number of people in their 60s, 70s, 80s, 90s and over the age of 100, the question of intergenerational inequality is a major one. My son is now a systems biologist working on various micro-organisms which cause serious diseases, and the speed at which work in that area is developing has huge implications for longevity and medical practice and for what can be done for the elderly in the last two or three years of their lives.

We need a sober, cross-party debate. All parties in government have struggled with this in the last 20 or 30 years. I suggest there might be a very strong case for a Lords sessional committee, for example, which would discuss this question in the broadest terms, because that is one of the ways this House can throw light on difficult issues that each party finds it hard to grasp. We need to ask how we promote longer-term perspectives in government and how we deal with issues where we have to address what we are leaving to our children and grandchildren.

The Chancellor of the Exchequer talks a great deal about the need to get our public debt down so that we do not leave the debt to our children, but he does not talk enough about what sort of investments we should make so that our children will have a better life, better infrastructure, better industries and so on to inherit. I find the selling off of capital assets in the public sector to fund current spending, to hold taxes down, amazing—it was one of the things in the coalition that I most disapproved of and tried to argue against—but it has, after all, been going on for the last 30 or 40 years. There is an underlying question here about whether taxes are too low in this country for the challenges we face, for old and young, in the next 15 to 20 years. There are the questions of taxing housing assets, which we do much less than most comparable countries; of the extension of the national insurance age, which the noble Lord, Lord Balfe, mentioned; and of the costs of social care, which the Conservatives themselves raised before the election and then backed out of during it. The cost of paying for the NHS, including end-of-life care, is huge. I think it is correct to say that half of what is spent on each person by the health service is spent in the last two years of any person’s life.

The Social Mobility Commission in particular stresses the importance of early years and education up to the age of 18. My perspective on this comes from having done most of my politics in northern towns and cities. I look at younger people there without much aspiration or much help, in relatively poor schools where the savage cuts in local authority spending have meant children’s social services are no longer provided, most schools do not have nurses, obesity is a problem because of the quality of the food they eat, and they do not understand how to move from school into work and have very little idea of what sort of skills they need for the sort of work they will face. Local further education colleges have had their budgets cut, so the transition to work and training for that half or more of our 18 year-olds who do not go to university is poorly provided for. I find deep cynicism in West Yorkshire about the new apprenticeship scheme and whether it really will focus on providing skills for young people or be used to provide transitional skills for those already in work.

These people—the left-behind as the noble Lord, Lord Bird, said—are also British citizens and we will leave to our children a much more deeply divided and much less peaceful society unless we address some of their problems. This is an intergenerational issue but also a deeply important social issue. We need better apprenticeships and more effort put into local economic and industrial regeneration. The point that the noble Lord, Lord Bird, made about banks that do not spend enough time thinking about investing in local regeneration is strongly felt there. Housing—both housing to buy and a revival of social housing—is crucial, and the prospect that the impact of technological change will make their situation worse, with insecure, unskilled work and zero-hours contracts, as the noble Baroness, Lady Jenkin, said, is also a serious problem. We have to debate this issue.

One of the reasons I have been converted to the idea that we should introduce votes at 16 is that, as the proportion of our voting population who are retired rises, so it would help to redress the balance if we also increased the number of young people.

The welfare state was introduced before the First World War partly because, as government began to recruit the working classes into the Armed Forces for national security purposes, it discovered that many in the working class were underfed, unfit and uneducated, and that they therefore needed to spend state money on people we would treat as our citizens. The welfare state now benefits increasingly the middle-class retired, who live 15 years longer than the working-class retired, who benefit a great deal from the National Health Service; and the poor—

[Baroness Chisholm of Owlpen (Con)]

Time.

[Lord Wallace of Saltaire]

I apologise. This is not a sustainable basis for a peaceful and united national community. It is an issue we must address.