Every 25-year-old in the country should be given a £10,000 Government grant in an effort to solve the yawning economic gap between the generations, a prominent think tank has proposed.
The proposal for a Citizen’s Inheritance, to be funded by a revamped, tougher version of inheritance tax, is one of a number of policies proposed by the Resolution Foundation at the end of a two-year study into intergenerational inequality.
The report from the think tank’s Intergenerational Commission, backed by business lobby group the CBI and trade union group the TUC, warns that today’s thirty-somethings are the first generation to see their incomes dropping compared to when their parents were at that age.
It points out that with record numbers of people renting and unable to get onto the housing ladder, and with many trapped in zero-hours jobs, radical action is necessary to reset the balance.
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The proposed universal Citizen’s Inheritance would be restricted to spending on a house deposit, or to fund “skills, entrepreneurship and pension saving”, the Foundation said.
Alongside the Citizen’s Inheritance are other proposals, including a £2.3bn NHS levy, to be funded by new national insurance contributions from pensioners.
It suggests social care should be bolstered with another £2.3bn raised by replacing council tax with a progressive property tax, which would impose bigger fees on those with bigger homes.
The extensive report also recommends a host of other reforms, including strengthening the rights of those renting their homes, halving stamp duty for first-time buyers and providing a tax holiday for second-home owners selling their properties to first-time buyers.
David Willetts, Executive Chair of the Resolution Foundation, said: “Many people no longer believe that Britain is delivering on its obligations to young and old.
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“But our Commission shows how Britain can rise to this challenge.
“From an NHS levy to put healthcare on a firmer financial footing, to building more homes and a Citizen’s Inheritance to boost young people’s career and housing aspirations, our report shows how a new contract between generations can build a better and more unified Britain.”