Who should Young People Vote for this May? Labour?

Liz Emerson, IF Co-Founder, analyses the manifestos using the lens of intergenerational fairness in the run-up to the May General Election. Today she inspects LabourIf_Blog_2015_election_logo

Young people beware! With the tightest election result anticipated for many decades come May, political parties are using increasingly desperate tactics to find votes, with bigger promises offered and little policy detail to back these promises up.

So who should young people vote for? As a non-party-political charitable think tank, the Intergenerational Foundation is unable to support any one party or set of parties. However, it is possible to analyse each party’s manifesto to see whether their major election promises are in the interests of younger and future generations.

Deficit reduction, a budget responsibility lock and paying down the national debt with the proceeds from bank sell-offs should in theory help younger and future generations by addressing the national debt. But, on further reading it soon becomes clear that the most expensive section of society, the over-65s, is excluded from any such lock. Spending on the over-65s already accounts for two-thirds of Department for Work and Pensions (DWP) expenditure, so the decision to exempt the largest group of recipients, irrespective of their wealth, from a lock is not good in terms of intergenerational fairness. If, as many economists suggest, we are entering a new global world order of long-term zero growth, where will the all-important GPD come from to pay for the spending pledges made in the Labour manifesto?


Labour offers good news for working families with a promise to double paternity leave and pay. Their free childcare offer – raising it from 15 hours to 25 hours a week – will again help young families. Labour has also promised to protect the education budget, but the devil will be in the detail over whether that is in real terms. Smaller class sizes are welcome, but there are no figures on how small these are likely to be and no mention of free school meals – unlike other parties. There is, however, a clear demonstration of educational investment in young people with the announcement that all children should study English and maths until aged 18. There also appears to be some understanding of the need to invest in the 50% of young British students who do not go on to higher education, with a promise to introduce “technical baccalaureates”.

The big news from a young person’s perspective is Labour’s promise to lower tuition fees from £9,000 to £6,000 a year. However, as yet there is no mention of what the interest rates on student loans are likely to be, nor any mention of the threshold at which repayments kick in. Labour could well face a backlash from student supporters who vote for them if, after the election, students find themselves having to pay more than the current level – 5.5% interest on student loans accruing while studying and 9% of income on earnings over £21,000.


Labour is offering the same raise in the National Minimum Wage to £8 per hour. However, they have gone further than the Conservatives by announcing a ban on zero-hours contracts. How this will be policed is of course another matter, with critics warning of the potential loss of flexible jobs. An apprenticeship for all school leavers is also to be welcomed, as is the acknowledgment that there is an issue over the exploitation of young people with a pledge to “tackle” the growth of unpaid internships. However, the language is loose and therefore open to watering down once elected. Labour, like the Conservatives, hurriedly announced a freeze on National Insurance Contributions but have not gone as far as pledging a reduction of employer contributions, which the Conservatives have offered. A “compulsory jobs guarantee” is a firmer pledge than the Conservative; however, it remains to be seen whether these will be the quality jobs that young people desperately need.


Labour pledges to build 200,000 new homes each year, introduce of a “Mansion Tax” to tackle unfair gains in housing wealth, create new garden cities, and impose “use it or lose it” planning powers for local authorities to drive new building. They also pledge that first-time buyers will be given preference when buying newly built homes. These policies, if implemented, will go some way to addressing the chronic shortage of housing. However there has been no pledge to protect housing benefit for young people, instead offering landlords a rental bonus in return for a reduction in rent. Housing benefit remains one of the key areas where younger, poorer people, without access to a bedroom in a family home, need help most. It is a middle-class presumption that young adults will come from homes with spare bedrooms or come from homes where they can live safely. For those young people who need to move to find work, it appears there is little to support them while they look for work or are on low incomes under a Labour administration.

Renters will get more protection under Labour. The introduction of three-year tenancies will however be difficult to police, as will promising a “ceiling” on excessive rents in the private rented sector. A ban on letting-agents’ fees is welcome, but – like the Conservatives – Labour have missed a trick by not addressing buy-to-let investment, which unfairly distorts the residential housing market, increases prices and pitches buy-to-letters against first-time-buyers. A pledge to encourage buy-to-let housing investment away from residential and towards build-to-let would at least help to increase housing supply.


A promise to spend “£2.5 billion more than the Conservatives” on health is a vague policy promise. The pledge to increase midwife numbers by 3,000 to cover the current baby boom is welcome. With NHS spending on retired households already double that for working populations, IF would query whether this increase in spending is intergenerationally fair when the costs of an increasingly ageing population are likely to fall ever more on over-burdened younger generations. Labour, like the Conservatives, have dodged the bullet and avoided brave and much-needed policy changes. These could have included the wealthy old paying more towards their own care. Instead, Labour has announced a social care cap, which will in effect pass funding costs on to younger and future generations.


Labour’s transport policy is very close to the Conservatives’ – investing in the rail network, roads and cycling. However, the drive to expand airport capacity flies in the face of intergenerational fairness in terms of the damage high altitude nitrous oxide emissions do to the environment. Shouldn’t all parties be doing more not less to encourage non-essential short-haul travel out of the skies and onto more environmentally friendly modes of transport?


Labour’s energy policy is also contradictory. While supporting an “energy mix” (no mention of fracking but an explicit support of nuclear), they will “encourage carbon reduction targets”. There is also no mention of support for wind or solar energy in the manifesto.


The announcement that Labour will create a National Infrastructure Commission is welcome but vague. What will this quango deliver? Labour used PFI contracts as much as the Conservatives when in government, and between them, the two parties have racked up PFI debts of more than £240 billion in service contracts for poorly built hospitals and schools, the repayment of which has been handed on to younger and future generations to pay. Many of these debts will fall due in 2040, leaving our children and grandchildren to pick up the bill for useless buildings.


There is no mention of increasing the personal allowance in Labour’s manifesto. However, a pledge to freeze the basic rate of income tax is helpful to younger and poorer workers.


Increasing the Job Seekers Allowance is welcome news, but this is neutralised by a Labour promise to “cap structural social security spending”. Alongside the Conservatives, Labour has also pledged to maintain the triple-lock on pensions, which makes the removal of the Winter Fuel Allowance from the richest 5% of pensioners nothing more than a tokenistic nod to younger and future generations. This is because the current State Pension liability is estimated to be a whopping £3.8 trillion. Labour could have promised a change from RPI to CPI or reduce the triple-lock to a double-lock, but older people vote and the young don’t.

The protection of universal benefits for older people is also intergenerationally unfair when every other age group is now means-tested. From child benefit and housing benefit through to working age family tax credits, every generation is means-tested. The arguments that it would not be cost-effective to means-test the wealthiest section of our society rings hollow when IF analysis has shown that – other than the 16% of over-65s in need of financial help– the rest are doing very nicely indeed. IF is not alone in identifying increasing wealth among older generations. The IFS, Resolution Foundation and many other think tanks have also come to the same conclusion: older generations have suffered the least of any group during austerity but their incomes have grown the most, alongside their housing wealth.


Labour does appear to believe that younger voters should be encouraged with the announcement that they would support votes for 16 and 17 year olds, and re-introduce block voter registration for universities to combat the disappearance of so many younger voters with the move to individual voter registration.