Intergenerational Foundation webchat with Co-founder Angus Hanton on 9 April

Thanks for having me on your forum.

It seems we are all concerned to improve the prospects of our children and grandchildren.

If you want to follow us, please sign up to our newsletter at www.if.org.uk

Yours for younger and future generations,

Angus Hanton

rosequartz

I have been wondering who funds this Intergenerational Foundation, who works for it, has any body commissioned its reports and does anyone take any serious notice of its findings?

Dear Rosequartz,

We are funded by individuals giving no-strings donations and by grant-giving bodies (including the Soros Foundation), but we also have many volunteers helping us (economists, academics etc) - people of all ages who feel that the current deal between the generations is weighted too heavily in favour of older cohorts and against the under 30s. We are concerned that politicians are courting the grey vote by making promises to them which will be paid for by the next generation, as Lord Andrew Adonis said on Radio 4 last week in his Lent talk.
Around the country these issues are being discussed across kitchen tables and people are increasingly aware that many young poor are suffering whilst older wealthier people are being protected. We feel that in allocating benefits and tax breaks government base these on need, not age.
For example, is it fair that the pensioner bond just announced by the Government is available to over 65s and excludes other savers, such as young people saving for their first home?
Our reports are quoted in parliament, the media, and used by official bodies such as the Bank of England.
Are you suggesting that it isn't legitimate to raise these concerns? Shouldn't we be listening to our young people?

JessM

How can you have fairness between the generations? Many members would say that is is not fair that they did not have the opportunity to get a decent secondary or tertiary education when they were young. Grammar schools and universities were for the elite - and fewer women than men were able to benefit from them. They might also say it is not fair that they were having to work hard from the age of 16, while their grandchildren appear to be living the hedonistic life of a student well into their 20s (or 30s) and have all kind of career opportunities that they would never have dreamed of. Have you ever looked at a book on Careers for Girls published in the 1960s?
I could go on. Fairness is always an illusion.
We are building fewer houses now per annum than at any point since the 1920s. according to the Economist this week (no link due to paywall - published online 24/3).

Dear JessM,

The principle that most people agree with is that idea that each generation should be at least as well off as the previous generation.
Many grandparents see the current financial difficulties of their children and grandchildren and want to help. We are suggesting that one way they can do this is by arguing for a use of our housing stock which doesn't leave younger people paying disproportionately huge rents and prices because we have created this housing problem, and another is to argue for policies that help create new homes for young and old alike.
Do students lead a hedonistic life? Our research shows that they will be leaving university with debts of more than £40,000 of debt and are paying high interest rates on student loans so that the effect is that they will be paying an extra 9% income tax for most of their working life, when many of us got our university education paid for by the state.
Our research, and that of the Institute of Fiscal Studies, shows that young people have been getting steadily poorer over the last 10 years while older generations have been getting wealthier. The Joseph Rowntree Foundation say that now poverty is more likely to be found amongst the under 30s than the over 65s.

JessM

How can you have fairness between the generations? Many members would say that is is not fair that they did not have the opportunity to get a decent secondary or tertiary education when they were young. Grammar schools and universities were for the elite - and fewer women than men were able to benefit from them. They might also say it is not fair that they were having to work hard from the age of 16, while their grandchildren appear to be living the hedonistic life of a student well into their 20s (or 30s) and have all kind of career opportunities that they would never have dreamed of. Have you ever looked at a book on Careers for Girls published in the 1960s?
I could go on. Fairness is always an illusion.
We are building fewer houses now per annum than at any point since the 1920s. according to the Economist this week (no link due to paywall - published online 24/3). Developers sit on land banks which increase in value with no effort. Limiting the supply of new properties also suits the developers very nicely as it keeps prices high. The Economist article says that if food had increased in price as fast as housing in the years since 1971 then a loaf would cost £51. This is the effect of supply outstripping demand.
I think that in focussing your attention on the inconsiderate older people who under-occupy their family homes you are barking up the wrong tree.
I have downsized you will be pleased to know. We are renting a flat and have let out our five-bedroomed house (to an Australian family - but even seconded civil servants need somewhere to live I guess). It was a massive project to get rid of most of my possessions, sort through old papers and make this happen. Over £1000 of donations to Oxfam alone. It was emotionally difficult and stressful. But there were two of us on the case. I can understand exactly why people in their 70s and 80s (possibly widowed or in poor health) are not in any way able to tackle such an endeavour on their own.

Our research would support your point about an age window for downsizing. Leave it too late and it becomes too great an obstacle. Please be re-assured that we are interested in government policy and that there are ways in which those that wish to downsize could be helped with solutions such as stamp duty holidays for downsizers or the creation of a government-backed downsizing agency.

rosequartz

When we mention the 'd' word to our DC they say "oh, but why, this is where we grew up, we love to come home to stay". And it is their inheritance unless extortionate nursing home fees eat it all away. Why not concentrate your efforts, Mr Hanton, on looking at why residential and nursing care costs such huge amounts of money that eats into the inheritance of future generations?

You rightly argue that residential and nursing care costs require a national debate over who should pay and for how long. It’s great news that we are living longer. Latest figures from the Office of National Statistics reveal a 72% increase over the last 10 years in the number of people aged over 100 years of age. However we are discussing downsizing today so please do email me at [email protected] if you would like to discuss possible solutions over how to pay for our rapidly ageing population’s care costs.

Stamp Duty Holidays - IF has suggested just that to policy-makers: Give those who wish to downsize an exemption or a discount from stamp duty on the property they move to.

All generations have felt the effects of austerity but our research reveals that younger generations have been systematically targeted for cuts whilst older generations have been systematically protected by policy-makers. Why is it that means-testing is deemed to be acceptable when targeted at the under-25s but is simultaneously deemed to be too expensive to implement for the 2 million over-60s living in households with assets (including housing wealth) of more than £1 million? Is this intergenerationally fair? And what does this say about intergenerational solidarity. I would suggest that policy-makers are playing divide and rule with the different generations of voters in order to favour those who vote more by taking away from the young.

The unpalatable truth is that politicians have known that we would be increasingly long-lived since the 1980s but no political party has been willing to say that we have not been paying enough in for what we will be taking out.

That’s why our real national debt is so eye-wateringly huge – close to £7 trillion pounds! In noughts it would be £7,000,000,000,000. We will be passing this debt on to our children and grandchildren to pay and is equivalent to over £200,000 for each UK household.

FlicketyB

1) Why are you called the Intergenerational Foundation when your stated purpose is (I quote your report) to promote the rights of younger and future generations in British policy-¬making. Intergenerational means co-operation between generations. Your report does not discuss ‘under-occupation’ by younger groups, or how space in houses is used in properties ‘underoccupied’ by households of all ages. It blames the older generation for everything.

We have a lot to get through so here are a few answers to the many questions you raise:

According to The Oxford Dictionary ‘intergenerational’ is defined as “relating to, involving, or affecting several generations.” Our work concentrates on researching how government policies are affecting different generations and we are deeply concerned that younger generations are being systematically targeted for cuts whilst other generations are being protected, irrespective of wealth.

FlicketyB

2) How do you define a bedroom? I have found no definition of a bedroom anywhere in your report. I will explain: a bungalow/flat is described as having 4 rooms. How many of these are bedrooms? A new-build, 4 bedroomed house I saw on sale recently had three rooms described as bedrooms on the first floor, but of the two rooms on the top floor one was described as a bedroom, the other as a study. Would your survey describe this as a bedroom or living room? Then there are houses with 3 or more rooms on the ground floor, sometimes these are bedrooms, sometimes they are not. How do you define a bedroom?

The government’s English Household Survey 2010/11 reports that 33% of all overcrowded households are those where the Head of Household is under 35 years of age. Young people tend to live together in shared accommodation or with their families because they simply cannot afford to live on their own in rented or bought accommodation. The largest group where over-crowding exists is obviously households with children. According to the same report 60% of all under-occupied households are those where the Head of Household is aged 55 or over – that’s a whopping 4.7 million households.

FlicketyB

3) How did you define an unoccupied bedroom? Did you include intermittent use of bedrooms as occupation or non-occupation? Many families are widely dispersed and older people will want to have children and grandchildren living and sleeping in the family home when they visit – and at times these visits may be both frequent and/or prolonged. Grandchildren living near grandparents may sleep-over, or a bedroom may be a day nursery if a grandparent is providing childcare. Again a crucial lack of definitions in the report

The Department for Communities and Local Government uses the Bedroom standard, which I have copied below:

“The ‘bedroom standard’ is used as an indicator of occupation density. A standard number of bedrooms is calculated for each household in accordance with its age/sex/marital status composition and the relationship of the members to one another. A separate bedroom is allowed for each married or cohabiting couple, any other person aged 21 or over, each pair of adolescents aged 10-20 of the same sex, and each pair of children under 10. Any unpaired person aged 10-20 is notionally paired, if possible, with a child under 10 of the same sex, or, if that is not possible, he or she is counted as requiring a separate bedroom, as is any unpaired child under 10.

“This notional standard number of bedrooms is then compared with the actual number of bedrooms (including bed-sitters) available for the sole use of the household, and differences are tabulated.

“Bedrooms converted to other uses are not counted as available unless they have been denoted as bedrooms by the respondents; bedrooms not actually in use are counted unless uninhabitable.

“Households are said to be overcrowded if they have fewer bedrooms available than the notional number needed.

“Households are said to be under-occupying if they have two or more bedrooms more than the notional needed.”

FlicketyB

5) You say: ‘The lifecycle of housing is breaking down partly due to the behaviour of older groups: rather than downsizing, more and more older people are staying on in the family home and hoarding housing wealth’. Down-sizing is a very recent phenomena. In the past a house was bought at marriage and lived in until the purchasers died. The elderly lady in a large house she could not afford to maintain could be found on every street 40 years ago. This is very rare now.

Downsizing as a phenomenon developed in the ‘sunbelt’ of the United States with the expansion of cities such as Miami and St Petersburg in Florida. Why is it that downsizing is twice as common in the United States where it is seen to be an accepted part of the housing lifecycle? Could it be that weather has a part to play?! In the UK enthusiasm for downsizing is increasing because, as our research reveals, those people that do take the plunge actually feel liberated by the experience.

I absolutely agree with your points about housebuilding. We need to build 100,000 new homes each year for the next 10 years. How can we join together to ensure that more are built for young families? Have you any ideas?

ethcal

What excellent comments made on behalf of us baby boomers, they reflect how I feel and how unjust it is to blame us over 60's for the woes of some of todays youth, not all are unhappy with how life is.We were brought up to stand on our own two feet and not to expect everything on a plate, in fact we didn't have a plate so do not expect us to give up what we have worked hard for.

Dear Ethcal,

This is about recognising a serious societal problem: with people living longer (which is great, of course) and a shortage of housing, government should provide incentives to encourage better use of the country's housing space, which could be by encouraging downsizing, helping with home sharing, greater intergenerational living, and increasing the rent-a-room tax allowance (unchanged since Margaret Thatcher's day).

Riverwalk

Mr Hanton you seem to have a particular beef about us oldies living in our many-bedroomed houses ...... so, if we downsize en-masse, will the younger generations be in any better position to buy our properties, or will they still be hampered by zero-contract hours, overseas buyers inflating the property market, shortage of social housing, etc?

Yes, younger generations are indeed up against it financially. Did you realise for example that many young people will be paying 40% tax when they enter the world of work if they’ve been ‘lucky enough’ to go to university: 9% tax on earned income over £21k from 2012 for their student loans, National Insurance of 12% and income tax of approx. 20%.

At the same time house prices, particularly in the South East, are rocketing, fuelled by a lack of building new homes, a lack of homes on the market, and property investors competing with them. Furthermore the spare homes we do have tend to be in areas where there are the least jobs. In fact, according to Shelter, we need to build 100,000 new homes, each year, for the next 10 years, due to changes in how we live and how long we live.

Many people seem to think that high house prices are good news. Many people chose to invest in property due to the 1980s collapse of pension funds and the current miserable returns on annuities. However, as many people wanting to downsize have discovered, our homes are only worth what someone else is prepared to pay. Those people who find their homes sitting on the market may have to face the unpalatable truth that they might be asking too much. But do bear in mind that average house prices have more than doubled in price in real terms since 1985! And of course if you live in the South East then they’re worth much more…

Gally

I have just read through the whole of this thread and have found it eloquent, enlightening and thought provoking. We Gransnetters are certainly a force to be reckoned with. I just hope Mr. Angus Hanton has the courage to turn up to answer these amazing comments - donning his hard hat on arrival!

Dear Gally,

Yes, Gransnet is a great organisation/network.
Many of the comments here seem to recognise that many older people want to downsize but that there are obstacles. Understandably it doesn't suit everyone. However, government could do a lot more to help those that do want to downsize, which will in turn help younger families with the current housing crisis. Our focus is on incentives and help for downsizers rather than criticising individual behaviour.

Tegan

I would love to downsize but, given how social care seems to be reducing not increasing means that I prefer to stay living next to good, helpful neighbours. Also buying/selling homes is a pretty awful experience in this country and I'm not sure I want to put myself through it. The number of people I know that have had a buyer pull out at the very last minute is frightening [usually trying to bring the price down even more]. Another thing that bothers me is the way that, when new housing developments are built, any further services required eg doctors surgeries/schools etc are not buoilt until the whole development is complete; how does that make any sense?? There are some nice little retirement bungalows in the village next to me and the majority of them are empty; I think the main reason is that they have a communal garden and most people I've spoken to said they would prefer a small, private garden of their own..just because you're getting older doesn't mean you don't want to own a dog or a cat. And [not really to do with this but I need to let off steam] our village had a complex built with flats and bungalows for the elderly. The doctors surgery that was a few yards from the development is closing down [thans NHS England et al] and there is talk of the village Post Office closing as well; we've all been told to 'get on the bus to the local town'. Why do planners not think ahead or even put themselves in the position of the people they deal with? Also, due to divorce I only have a small pension and hope that, if I ever need to move into a care home my pension plus renting out my house would cover the costs involved. I used to feel very comfortable with the thought of growing old in this country but, alas, it now terrifies me.

Please be reassured that your concerns are similar to those of the people we surveyed in our Understanding Downsizing report. Finding the right property in the right location, close to amenities, with good public transport links, and a small amount of outside space, seems to be what people need when considering downsizing. Pressure needs to be put on local councils and developers to ensure that appropriate developments are built. Perhaps you could take this up on a local level? Our research also revealed that those who had downsized did best when they remained close to their social network and future-proofed their transportation needs by choosing to live on a bus route or close to amenities. Please do bear in mind that all those surveyed who had downsized felt liberated from the upkeep and bills of their previous homes.

There is a real need for estate agents that specialise in downsizing, who can be trusted to understand the needs of downsizers and take them through the process slowly. We could learn much from the American model.

On buy-to-let I would agree completely that government needs to do more to prevent the exploitation of the housing market with annual subsidies of £11bn given to buy-to-let investors.

I do hope you find somewhere suitable.