The analysis further shows the young were overwhelming in favour of Labour, with 66% of 18-19 year olds voting for Jeremy Corbyn’s party and 62% of 20-24 year olds. Meanwhile the older generation swung the other way, with only 19% of 70+ voting for Labour.
May’s mistake: pension policy would never sway Generation Vote – Jon Greer, head of retirement policy at Old Mutual Wealth:
“Labour’s manifesto was broadly seen as friendly and well positioned for the young as it made pledges that effected issues that were close to the hearts of the young. They promised to solve the rising student debt problem by abolishing tuition fees as early as autumn 2017, and to build 100,000 discounted homes for first time buyers.
“However, by voting for Labour, the young also voted to keep the pension triple lock, which sees the state pension increase by the higher of earnings, inflation or 2.5 per cent, and promised to scrap state pension age rises.
“Calculations show that if the triple lock were retained beyond the middle of this decade then that element of the state pension alone could end up costing around 1% of GDP. Analysis from the Cridland Report shows that if that 1% rise was faced today this would be the equivalent to a rise in taxation of £725 per household per year.
“The state pension operates under a ‘pay as you go’ system so, instead of saving for your own state pension, you fund the pensions of current pensioners. This means the more generous the terms, the greater the funding required from current workers.
“The Conservatives were the only party that promised to get rid of the triple lock, however, this gift to the younger generation went broadly unnoticed by them. Worse still it turned the party’s crucial grey vote against them.
“Pension policy should be a concern for the young vote as much as the old. Politicians have learned a lot from this general election. Now, the pensions industry needs to ensure it also learns. The younger generation has found its political voice and this voice reveals we need to do more to make sure they understand what pension policies means for them.”
The young have found their political voice – Richard Buxton, head of UK equities and CEO, Old Mutual Global Investors comments:
“With no memory of the disasters of post-war socialist government and runaway inflation, Corbyn’s agenda is hugely appealing for the younger generation.
“Millennials are the first generation to face the prospect of being worse off than their parents. They have had enough and want a fairer opportunity set than is offered today.
“Intergenerational inequality is the real topic politicians and policy-makers will have to address over the coming years.
“Inevitably, we have reached the end of the road for policies which favour capital over labour. Do not anticipate further falls in corporation tax. Expect more indirect and direct ways of extracting a greater ‘contribution’ to society from big business.
“Expect new thinking on how to fund students through college. A levy on share buybacks to fund student grants? This could be exactly the sort of policy we face in the years ahead.
“Higher earners should also brace themselves for a greater ‘contribution’ too. Do not be surprised if the ‘mansion tax’ resurfaces. Early abolition of inheritance tax is dead in the water – if anything, rates might rise as an involuntary means of diverting intergenerational wealth.
“The younger generation have found their political voice and Westminster had better listen. Over time, I expect policies to tilt in their favour.”