Give U.K. Millennials $13,500 to Tackle Wealth Gap, Report Says
(Bloomberg) -- Young people in the U.K. should receive a 10,000-pound ($13,500) cash handout to help address the wealth divide with older generations, a think tank proposed Tuesday.
The Resolution Foundation said a “citizen’s inheritance” should be paid to people on their 25th birthday to help them with a deposit to buy a home, training costs or cash to start a new business. It would be funded by increasing the amount the government gets from taxing inheritances.
The report also calls for workers of retirement age to keep paying national insurance contributions -- a social-security tax -- to provide a 2.3 billion-pound boost for the state-funded National Health Service.
“Britain’s contract between generations lies at the heart of society,” said David Willetts, the former Conservative government minister who chairs the Resolution Foundation. “As families we provide for our children and parents at different times. We expect the state to support these natural instincts -- but too often it is tilted in the opposite direction. Many people no longer believe that Britain is delivering on its obligations to young and old.”
The report was prepared by the foundation’s Intergenerational Commission, whose members include Trades Union Congress General Secretary Frances O’Grady and Confederation of British Industry Director-General Carolyn Fairbairn.
A sense of grievance will build unless action is taken, it warns, as those who do not inherit assets are increasingly put at a disadvantage. Millennials at age 30 earn no more than the generation before them and rates of home ownership have fallen, with renting or remaining in the family home the only options for many after years of rocketing house prices, it said.
©2018 Bloomberg L.P.