By freezing age-related personal allowances with a view to aligning them with working allowances – the word was "simplification" not "theft" – and other grey tweaks Osborne has taken £3-4bn out of the grey economy, an average loss of £84 a year, according to the Guardian's front page.
Those with pensions above £25,400 will not lose out at all. Those approaching retirement will be working longer and face greater uncertainty. Put it all together and that's a hit which will rankle among the kind of folk who tend to vote, probably more Tory than the average voting cohort.
But hang on. What about student loans? What about 20% unemployment in the 18-24 age bracket? What about the price of houses for first-time buyers and the rising levels of rent? What about childcare? Etc, etc. The young face a lot of uncertainty too and have only one ace to play against their parents' and grandparents' generations: they're young and have their lives ahead of them, whereas we're all heading for the crem.
The redoubtable Ros Altmann, director general of Saga and the Michael Mansfield of old age, has weighed in to denounce this "enormous stealth tax" on her customers. She is joined in the Guardian by residents of a care home, including Edna Newton (93) who "fought the war" and expected better. She's had to sell her home to pay for care.
Most 93-year-old survivors are pretty feisty in my experience, so I'm sure Edna Newton won't mind if I remind her that she can't take her savings with her on her next move and that if she doesn't pay for that care younger taxpayers will have to. But as the FT asserted in a series last week, the twentysomething generation now entering the workforce may be the first since Edna Newton was that age who cannot expect to be better off that those who went before.
It's a sobering thought, though I should add that sceptical FT readers complained that median incomes (ie at the 50% point) of 65-plus types is half that of the 25-35 crowd. Yes, but the latter's income has been pretty flat in real terms for a decade and, if they have families or mortgages, they have heavier costs and a lower disposable income.
Plight
So I have sympathy for the Barretts, a Lancashire couple quoted as being "furious" with the budget in Thursday's Daily Mail. They boost their £24,600 a year income with unspecified savings (he used to be a financial adviser) and struggle to save enough to visit their daughter in New Zealand. It's a trip I make myself to see family, so I sympathise there as well.
But the Barretts' plight illustrates the point so obvious in all age groups in our unequal society: that misfortune and hardship is relative. How many thirtysomething families can see their way to visiting their Kiwi cousins? They will, they will. Things will probably turn out better than current fashion predicts.
The real complaint the elderly have about post-recession Treasury policy is that it has – courtesy of the Bank of England's "active" monetary policy which slashed interest rates to keep the economy afloat – sharply cut the income of retirement annuities (the income which older people buy with their savings) and cut the return on bond and (generally) share income while allowing inflation to run ahead of the 2% target for years.
"Quantitative easing", the posh way of saying "printing money", is in my view the right policy for the economy as a whole – and for economic recovery – but aggravates both of the above problems for savers.
That said, the coalition has up to now been conspicuous for not caning OAPs or provoking grey wrath. Winter fuel allowances, free bus passes and other perks were not attacked in the way other parts of the welfare budget were. Pensions have gone up a bit, though I seem to recall we lost free swimming. David Cameron promised to protect the oldies in 2010 and – until Wednesday – he did.
The real story in the bigger picture may be the emergence – or re-emergence perhaps – of a "family welfare" model of support, long evident in southern Europe and poorer parts of the world, whereby the family unit supports each other in countless ways such as childcare and the Bank of Mum and Dad, a potent cliche of this decade, lends or gives money for assorted urgent needs.
There will be winners and losers, there always are, and the state's job is to help those who need it most. As a not-yet-retired oldie who worries about money (though I shouldn't, I'm among the luckier ones) I never cared for the "we're spending the kids' inheritance" joke but didn't think they had a God-given right to inherit the family home either. Inter-generational solidarity is a good principle, so is family solidarity.
It was one of my own children who drew my attention to the FT series that reminded the paper's well-off readers how lucky the postwar boomer generation has been. He doesn't feel hard done by, but he's acutely aware of inter-generational imbalances, not least in the prices of homes in London.
The real big-picture worry about the budget was that it showed no strategic flair, no master plan for getting the becalmed British economy off the rocks of near recession and deepening debt and into a strong wind which will blow it back to recovery and renewed prosperity.
Reading the reviews I am reminded of Coleridge's ancient mariner and that albatross. In 2012 the old seadog would have his capped age-related allowance to moan about, on top of everything else. The wedding guest would still be listening.
Source: guardian
Author: Michael White
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