3 days ago
Government accused of prioritising pensioners over children
A gulf between government spending on pensioners and children has widened by 170pc in the past two decades, new research suggests.
Last year, public spending per pensioner was £12,600 higher than it was per child, according to a report by think tank the Intergenerational Foundation.
It reveals spending on pensioners has increased by more than half in the past two decades, while the amount of taxpayer cash devoted to children has lagged.
Between 2004 and 2024, spending on retirees went up by 55pc in real terms, while children saw an increase of just 20pc during the same period, the report said.
Analysis showed taxpayers spent £31,000 per pensioner last year compared with £18,000 per child, while working-age adults cost £14,000.
It comes after Rachel Reeves reversed her decision to strip most pensioners of the £200 winter fuel payment following a months-long public outcry.
Liz Emerson, chief executive of the International Foundation, said government policy is overly favourable to pensioners because they are a key voting constituency.
She said: 'Welcome, though rapid, ageing has expanded the welfare state for the old while support has been largely withdrawn from the young. Add the power of the grey vote, and it is all too tempting for governments to respond to older generations' wants, irrespective of their actual need.'
She added this increasingly contrasted with societal difficulties faced by younger people.
'Younger generations face a polycrisis of low government investment, high housing costs, low welfare support, and high taxation.
'The fact that birth rates are falling may well indicate that younger generations do not believe they can provide the economic stability needed to bring up a family.'
The research divided government spending on public services like the NHS, state pension, education and social care by the number of children, working-age adults and pensioners in the country.
Britain's birthrate recently fell to a record low. The official fertility rate for England and Wales is 1.44 births per woman, significantly less than the 2.1 required to maintain population size.
Figures published at the end of last year showed that the number of children born to British mothers had fallen by a quarter in 15 years. It suggests many more women are putting off having children, amid rising cost of living.
The increase in state spending on pensioners has been partly driven by the pensions triple lock, which links state pension payments to inflation, wage growth or 2.5pc depending on whatever is highest.
Between 2011 and 2025, the state pension for those who reached retirement age before 2016 rose from £102.15 to £169.50 per week, a 66pc increase. Those who hit retirement age after 2016 saw weekly payments go up from £155.65 to £221.20.
The report concluded that the triple lock was not 'intergenerationally fair' amid a growing ageing population, referencing Office for Budget Responsibility (OBR) projections that government spending on the state pension will increase from around 4.9pc of GDP last year to 7.9pc by 2074.
It added that pension poverty had declined significantly in recent decades, from 28pc in 1995 to 16pc in 2023. Meanwhile, child poverty has remained consistently high with only a marginal decrease from 32pc to 30pc during the same period.
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