However you feel about Thursday’s result and Boris Johnson’s electoral victory, we must accept the age of Bojo and understand how it might shape our finances. Here’s what we need to do to make sure this government is the most youth-friendly yet
So how did you feel on Friday morning when you woke up and heard Boris Johnson was (once again) our prime minister? Delighted? Relieved? Dismayed? Despairing?
Personally, I woke up at about midday feeling absolutely shattered. That’s because I had stayed up all night to cover my third election count in four years in my local area, Kensington. It started out as a bog-standard job in 2015. I had signed up to a freelance database just after going self-employed and was contacted shortly afterwards by a journalist working for a broadcaster. Would I mind going along to the count at Kensington Town Hall for the general election, he asked me, then phoning in the results? I thought: “why not? I’ll probably stay up late anyway. I might as well get paid to do it.”
Little did I know what I was letting myself in for. Sure, the 2015 count was one of the most boring jobs I’ve ever had to do. But it was followed by another election just two years later. And that was the year that Kensington went from being a safe Conservative seat to the most exciting, dramatic election count in the country. Labour won by just 20 votes after three recounts. My Twitter coverage went semi-viral and I went on Radio 4 to speak about it. Fast forward to last week and I was back to see whether Labour would hold on. They didn’t, with the Conservatives regaining the seat by 150 votes. And this time, the response to my coverage was far more muted: possibly because Twitter wasn’t getting the result it wanted?
So I hung my hat up as a pound-shop Laura Kuennsberg and got back to my day job (I can’t say I’m sorry. Call me strange but I much prefer being a Young Money pundit: the hours aren’t as long and the Twitter abuse isn’t as vicious). But that doesn’t mean the landslide victory for the Conservatives on Thursday doesn’t mean anything for young people. Far from it.
Manifesto maths = a waste of time
In the run-up to the general election, many financial journalists pored over the manifestos to offer up their careful analyses of what the main parties were offering voters. That’s partly because it’s what financial journalists feel obliged to do, even if they know deep down it’s a waste of time. But it’s also because some journalists may have genuinely believed there was a real fight happening here on fiscal and economic grounds.
Anyone reading the runes, however, would have known this election was REALLY being fought over Brexit and the respective popularity of both leaders. I got a very strong impression that the voters who REALLY counted in this election weren’t agonising over social care, Skills Wallets or subsidised dental care. They were looking at a much, much bigger picture that didn’t really encompass short-term personal finance. So I knew costing, comparing and categorising the manifestos according to how much they affected different groups, however diligently this was done by many financial journalists, would feel like a gigantic waste of time and effort.
In fact, I was predicting to my nearest and dearest at the beginning of last week that Boris Johnson would win a landslide on the back of disaffected former Labour voters up north – though this is only what many polls were hinting at. In that eventuality, I knew the Labour and Lib Dem promises would quickly become an irrelevance, but also that the deliberately threadbare Conservative manifesto would only be fleshed out once victory was assured. The party was too wounded by the 2017 electoral disaster to contemplate otherwise.
This all sounds like the benefit of hindsight, which is why I wish I had been a bit braver and let on what I was thinking last week. But I kept schtum because my prediction would have looked positively wacky in the days – and certainly hours – leading up to the Exit Poll. And possibly sacrilegious to my fellow millennials too. London Twitter was convinced that a hung parliament was on the cards, that dozens of young people queuing at their polling stations before going to work was the foreshock in a massive youthquake that would inevitably favour Magic Grandpa.
A contained youthquake
It’s certainly true that more young people came out for Labour than the Conservatives. According to Lord Ashcroft’s post-match analysis, Labour won more than half the vote among those aged 18-24 (57%) and 25-34 (55%) who turned up to vote, though it’s notable that the Conservatives (rather than the revoke-happy Lib Dems) came second in both groups. By contrast, the Conservatives vaulted ahead among those aged 45-54 (with 43%), 55-64 (with 49%) and 65+ (with 62%).
Labour busted a gut to shore up its gen Z and millennial vote. And a fat lot of good it did the party – and indeed the young people who now feel crushed by this result. I feel incredibly sorry for anyone who may have been led up the garden path by a programme and leader that was electorally hopeless yet also primed to upset, anger and devastate if it were to lose. The binary, simplistic battle between good Labour and evil Conservatives was always a recipe for deep resentment and bitterness in the face of an inevitable majority for Boris Johnson.
I don’t need to elaborate on this: that’s a job for other commentators. I also don’t want to make Young Money any more political than it has to be: this is a blog for everyone, regardless of your political leanings. The only bias here? I’m on your side, and want to make things better for young people.
Which is why I say this: let go. Make your peace with Thursday’s result. Accept it. Move on from the election, from the failed manifestos and the politicians who will quickly be consigned to history. Understand that no good can come from hashtags like #notmygovernment. Railing against a democratically-elected government and blaming everyone and anyone for what’s happened won’t actually make you feel better about the situation, nor will it improve your finances.
Far better to channel whatever you’re feeling right now into making sure the next five years can be as good as possible for young people. Because believe or not, there is a strong electoral imperative for Boris Johnson to take young people more seriously in the future.
It might be far better to direct your efforts into holding this new government to account on a range of issues that need to be urgently addressed. These include, but are by no means restricted, to the following:
Forget Extinction Rebellion: if we don’t urgently tackle the housing crisis, Boris Johnson will have a real riot on his hands soon enough. Housing has rightly been identified by the economist Liam Halligan as the key issue that will affect the Tories’ electoral chances in the future (his book, Home Truths, reviewed on this blog last week, is a strong contender for Young Money’s book of the year). Yes, more houses need to be built but fundamentally, our corrupt planning laws also need to be radically overhauled, and land valuation radically reformed, so that genuinely ‘affordable’ homes aren’t left on the back burner. The Conservatives need to update their roadmap to include a concrete target for affordable home building and be more ambitious in social housing provision for the most vulnerable, which has completely collapsed. All these things will help young people far more than Help to Buy, which is ultimately a failed scheme that needs to be phased out as soon as practicable (without causing too much of a shock to housebuilders), and Lifetime Mortgages, where new homeowners can lock into low rates lasting decades but are at risk of onerous conditions for pulling out prematurely.
- Pensions & Investing
There are so many complex tax traps to untangle within the pensions system. On the simplest level, we need to scrap the net pay anomaly which means lower income workers are penalised for saving into their workplace pension as well as the tapers that discourage people from saving more into their pension, including desperately-needed NHS staff. I’m glad to hear both issues are already on Boris Johnson’s radar. The pensions dashboard will hopefully become a reality, allowing people to see all their pension pots in one place, but I’d love to see this government overhaul long-term saving in the UK. Perhaps a re-brand for workplace pensions? I quite fancy the name ‘future fund’. We need much more easy-to-understand info on just how people need to save enjoy the retirement they expect. I’d also like to see an extension to the sidecar savings scheme, which allows lower income workers to build pension contributions into emergency savings pots. Greater thought could be given to the Lifetime Isa, and indeed the cradle-to-grave Isa. Plus, we need to do far more to encourage workplaces to provide financial education and advice: tax breaks for employers who help their workers must be extended and publicised much more widely. Above all, we need a top-down message that promotes, extols and celebrates long-term saving if we have any hope of getting young people to put more towards their future.
- Financial education
Why oh why can’t a Conservative government get properly behind financial education on the school curriculum? It chimes perfectly with Tory values and will help millions of young people leaving school to navigate our complicated, often perilous financial system. Not all financial education works but we know a lot more than we used to, and the schemes that do work (such as MyBnk’s lessons in inner-city London) are producing spectacular results, particularly among more vulnerable groups.
Regulation has been reactive for too long. It has allowed lenders to exploit young people before shutting up shop and sauntering off into the sunset, leaving devastated lives in their wake. We have a nascent debt crisis in the form of buy-now, pay-later schemes, which are already coming back to bite young shoppers, while credit builder cards have been allowed to trap borrowers in a state of debt dependency for far too long. I fear these predatory business models, as with payday loans, will metastasize for some time to come before any action is taken. When it comes to debt, prevention is the best cure: the government must commit to making sure each and every lender out there plays by strict rules that ensure people can borrow and pay back debt at fair, affordable rates.