My blog post of 12th April 1956! attracted a rather wider audience than my posts are usually accustomed to reaching. As a consequence, I’ve had quite a large email correspondence on the back of it. Most controversial is the figure I quoted stating that the average person born in 1956 will have consumed some £300,000 more in benefits that they will have paid in taxes.
I’ve had manyfrom that age cohort complain that they’ve ‘never taken a penny’ and demand to know how the figure is calculated.
The calculation appeared in a paper produced by the Resolution Foundation: An intergenerational audit for the UK (2023):
In Annex 1 – “Analysis of net lifetime benefits from the welfare state” , (Chart) 6 –“Net lifetime benefits from the welfare state, by year of birth” They gave an estimate of between £290,000 and £310,000. As stated in their notes below the chart, they included the following net lifetime benefits: State pension; NHS spending; Education spending; other public service consumption; and cash benefits.
Minus taxes paid: Income tax; National Insurance; VAT and other indirect taxes.
All the figures are discounted to present value and expressed in 2023 prices and, averaged across the entire 1956 birth cohort.
Such a mathematical illustration will invariably include a spread with many well above, and also well below the mean.
What I thought was healthy about the response was that people clearly did not want be seen as being part of a cohort that was not self-reliant, and which consumed more benefits from the state than they paid for in taxation. I take this to mean we are a bit embarrassed about being dependent, that there is still a residual pride about not living ‘on the parish’.
Halleluiah! I had begun to fear that we had become shameless, seeing state benefits as an entitlement, and that we were inured to dependency.
If there remains at least some a concept of a ‘moral peril’ with regard to welfare dependency, then we have a prospect of recovery from it.