The Treasury has been roused from its slumber by a grim prognostication: Generation Z, those digital natives born into a world of precarity, are quietly planning for a retirement devoid of the state pension. That is not a headline. That is the acknowledgement of a civilisational failure.
Let us be clear. The state pension, that post-war Beveridgean dream, was always a Ponzi scheme dressed in tweed. It worked as long as the demographic pyramid stood firm: a broad base of workers supporting a narrow peak of the elderly. But the pyramid has inverted. We are now a society of inverted ages, a nation of the elderly few supported by the shrinking many. And young people, contrary to the popular caricature of avocado-munching fecklessness, can do basic arithmetic. They have looked at the numbers and concluded: the pension will not be there for us.
What does this mean? It means a generational rupture. The social contract, already tattered, is now being torn up by the very people who were supposed to inherit it. Gen Z is not waiting for Whitehall to act. They are acting. They are investing in cryptocurrencies, in side hustles, in property speculation, in any hedge against the collapse of the state’s promise. They are forming a new kind of financial stoicism: expect nothing, plan for everything.
The Treasury’s response? Urgent action is needed. But what action? The usual alphabet soup of consultations, green papers, and cross-departmental taskforces. Meanwhile, the young are voting with their feet and their wallets. They are moving abroad, delaying home ownership, and treating the state as an unreliable landlord of last resort.
This is not merely an economic problem. It is a moral one. The state pension was not just a transfer payment; it was a symbol of intergenerational solidarity. ‘We all pay in together, we all draw out together.’ That solidarity is now broken. The young see the old as beneficiaries of a system they will never enjoy. The old see the young as unpatriotic scroungers who refuse to have children. Both are wrong, but both are acting on their perceptions.
What is to be done? Means-testing? Raising the retirement age? Abolishing the pension altogether? The policy details are for wonks. The deeper truth is that we have reached the end of the age of entitlement. Every advanced economy faces this. The difference is that Britain, with its addiction to short-termism and its reverence for the elderly vote, will likely kick the can down the road until the can explodes.
Gen Z has already heard the explosion. They are building their own shelters. The rest of us should take note. The golden years are dead. The future is grey, and not in the way we expected.
