When philosophers and political theologians get together these days, there only seems to be one topic of conversation. With the social order perched on a knife-edge, what singular issue is most likely to tip indifference into public disorder? Given the political scandals, gaffs and hypocrisies of recent months it’s tempting to think that the general population has become both indifferent and immune to controversy. Hanging over the UK is a sense of disenfranchisement and powerlessness that has few parallels in political history, which is perhaps why some individuals have come to believe they are beyond reproach. Such delusions are particularly dangerous in that they assume the current public mood is a highly dissipated range of views and opinions from which co-ordinated action is unlikely to manifest itself.
One only has to look across the water to France this week, to see that there are issues that can touch the public nerve in profoundly motivating ways.
As far back as January, President Emmanuel Macron was warning the French public that the present global downturn has blown a €20 billion hole in the French economy and radical measures are needed to secure the country’s future. A key part of the president’s vision has always been a reform of France’s pension system, which would include raising the legal retirement age from 62 to 64 by 2030. Such radical measures are no whim, politicians in most countries have known for a long time now that pensions – and more precisely pension deficits – are the elephant in the room when it comes to any meaningful discussions about economic recovery. Macron is simply ahead of the game in getting the problem out in the open and confronting the realities of the gaping fiscal chasm that has opened up between the vast numbers of older workers coming up to retirement, and the far lesser number of young workers able to support them through taxation.
Here in the UK, legislators continue to bury their heads in the sand on this one and hope that somehow the problem will go away, if we can just reboot the economy, uplift salaries and the taxation of young workers and persuade ‘older’ (now rebadged ‘experienced’) workers back into the wage and taxation system. The very hint in parliament early this week that the government might be thinking of raising the UK pension age from 66 to 68 (in the same week that the government has scrapped the £1m lifetime allowance for wealthy pension savers) had Tory MPs shouting such dire warnings about a public backlash that the idea was swiftly thrown beyond next year’s General Election.
Across the Channel in France, President Macron is clearly less intimidated by public opinion, though the sight of Bordeaux town hall and other civic buildings around the country in flames last night might just make him think again. It is estimated that more than one million citizens took to the streets across France yesterday to protest at the pension age increase, and a range of other social discontents that have been ignited by Macron’s pension and social reform plans. Such has been the level of protest and violence overnight that King Charles III’s first state visit to France as King – scheduled for this Sunday – has now been cancelled.
Despite being rattled by large scale and highly disruptive public protests that have been taking place since January the French president has ploughed on, clinging to the conviction that his economic plan is right and necessary, and the French public are simply going to have to endure it.
On Monday he pushed the envelope further, narrowly escaping a no-confidence vote and having to resort to a special constitutional power, called Article 49:3, to force the pension age bill through without a vote. This sparked angry protests across France last weekend, and throughout the week we’ve seen the focus of the pension process expand and evolve to encompass a whole range of issues and agendas.
As we’ve also witnessed in recent years in this country, in particular with movements like Stop the City, Extinction Rebellion and Black Lives Matter, single issue protest can evolve rapidly into multi-faceted, large-scale civil disturbances that can be incredible hard to engage with, or to control.
Here in the UK the pensions debate is particularly incendiary, and for very good reason. It’s worth reminding ourselves that until the 20th century, poverty was a de-facto criminal offence, and had been since the Vagabonds and Beggars Act of 1494. Poverty was seen as a consequence of moral degeneracy, and the workhouse was the prescribed state punishment for ‘offenders’. It wasn’t until the early 1900s that the concept of social welfare was even considered, and the Basic State Pension only arrived after the end of the Second World War, in 1948.
The economic upturn in the post war years, and in particular the boom of the 1960’s, engrained the principle that it was astute and wise to put a little away for later years, and all the financial mechanisms of government and the banks ensured that pension pots grew healthily and consistently.
Throughout the baby boom years and beyond everyone was so busy improving their lot that no-one considered this was a bubble that might eventually burst.
It wasn’t until the early 90’s – when Robert Maxwell was found to have plundered the Daily Mirror Pension Fund – that everyone began to realise that investing now for a guaranteed secure retirement might not be guaranteed at all. Finance houses too saw the cracks beginning to appear, and the government pushed through a plethora of laws trying to shore up an increasingly fragile pensions sector.
When Tony Blair came to power in 1997 his chancellor Gordon Brown spied the bloated pension pots, and promptly abolished substantial tax relief on dividends that pension funds received on their investments. It’s estimated this raid had netted the government some £118 billion by 2014 which, if invested, could have added an additional £230 billion to the UK workers’ pension pot. Since then, a whole raft of regulations, strategies and legal changes have allowed numerous agencies to participate in a much more widespread raid on pensions savings, whilst preventing savers from accessing and benefitting from hard-earned savings stashed across a lifetime of work.
The Office for Budget Responsibility estimates that the UK state pension bill is going to grow from £110 billion this year to around £148 billion over the next five years, and that shocking level of increase could continue to grow for several decades ahead. In blunt terms this means that the next two or three generations of young hard-working people (ie, our children and grandchildren) will have to plug the pensions gap that has been left by years of financial mismanagement and government tinkering. Unfortunately an increasing number of older people and a steady decline in the number of young people probably means that, with the best will and the toughest taxes in the world, it simply won’t be possible for the UK state to support the retired for much longer.
And what happens then? Well, it seems that the only strategy on the table at present is to keep kicking the retirement age down the road and push as many people as possible into work. Effectively, we may all have to toil until the day we die. Whilst this may echo Genesis 3:19 “By the sweat of your brow you will eat your bread, until you return to the ground – because out of it were you taken. For dust you are, and to dust you shall return” – there’s not many a modern-day theologian who would say that Christ and the New Testament intended that this should be so.
It does seem that, for all the alleged social progress of the past century, society has somehow wandered into a place where the fear of poverty in old age is now more intense and consequential than it was in the days of the Victorian workhouse. We have become fixated and manacled to our possessions and our little portion of wealth, and governments and finance houses have played ruthlessly on our deep-seated insecurities – with disastrous consequences.
It may be painful to accept, but we can’t heap impossible tax burdens on our children, and we can’t be expected to work until the day we die, all out of a presumption that our present broken political and social care systems must be maintained as they are. Fixing the pension system is not just a matter of fiscal management for the future, but of moral responsibility for the present. Government needs to acknowledge this, and find solutions that don’t sacrifice an entire generation. After a lifetime of employment, we deserve some peace in the autumn of our lives, but equally we should be able to leave this world knowing that we have left behind some small hope and security for our children.
Joseph Kelly is a Catholic writer and political theologian