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My new @SMFthinktank briefing paper on "intergenerational fairness in the coronavirus economy" is now out. It sets out the case for ensuring that future austerity, to pay for the current economic lockdown, is shared fairly across generations.
http://www.smf.co.uk/publications/intergenerational-fairness-coronavirus/
http://www.smf.co.uk/publications/intergenerational-fairness-coronavirus/
The working-age population face enormous financial losses in the current coronavirus crisis, in a lockdown aimed at saving the lives of those at greatest risk, a group that is largely (but not exclusively) made up of older people.
Current economic sacrifice is the right thing to do; members of a good society look out for each other. As we emerge from the crisis, older generations must uphold their part of the social contract by bearing a fair proportion of future tax rises and welfare reforms.
This need for intergenerational reciprocity is all the more important given the lack of it after the global financial crisis. Working-age benefits were cut, capped & frozen, while the State Pension was protected by a "triple lock" and universal pensioner benefits retained.
We make a modest request in the briefing paper: to ensure future austerity is fairer, the triple lock for uprating the State Pension each year (2.5%, earnings, inflation - whichever is greater) should be replaced by a double lock of earnings or inflation (whichever is greater).
Getting rid of the entirely arbitrary "2.5%" element of the triple lock could save £20bn over the next five years, under our calculations. Pensions would still rise, but less quickly, reducing the fiscal burden on the working-age population.
Good to see the report covered in several newspapers this morning. The Telegraph: https://www.telegraph.co.uk/business/2020/04/13/scrap-pensions-triple-lock-spread-cost-coronavirus-blow-researchers/
The Guardian: https://www.theguardian.com/business/2020/apr/14/scrap-triple-lock-uk-pensions-coronavirus-crisis
Welfare Weekly: https://welfareweekly.com/scrap-state-pension-triple-lock-to-help-pay-for-coronavirus-lockdown-says-think-tank/
