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Chris Leslie MP, Labour’s Shadow Chief Secretary to the Treasury, in a speech in Camden, said:

I want to start by thanking you, Ashley, and the Intergenerational Foundation, for hosting the event today and to thank everyone at the WMC College here in Camden for letting us meet at this historic centre of learning. Impressively, this is the oldest surviving adult education college in Europe, and where successive generations of young adults have improved their skills and broadened their horizons for over a century.

Today I want to talk about the choice facing the country at the next election – a profound choice for everyone - but a particularly important choice for those in their 20s and 30s who have been acutely affected by the cost-of-living crisis in recent years.

I want to set out why it is important we have a government that understands the ambitions and aspirations of those at the beginning of their working life - and why government should value their efforts and be championing their endeavours.

We have government departments for a whole variety of important activities – for health, for transport, for pensions and for business.

But when it comes to the issues facing those developing their careers, for the so-called ‘Generation Rent’ at the start of their working lives, currently there is an increasingly heavy burden and a distinct lack of cross-departmental coordination in government.

After all, this is the generation upon whose shoulders the future prosperity of our country depends.

The generation driving our international competitiveness and productivity.

The generation who will be working to support those in retirement and our future generations.

There are fifteen million younger people under the age of 35 in this country and in nine months’ time they face a choice about how the economy and government will reflect their ambitions and aspirations.

They have a right to know the different approaches the political parties will take in shaping their future.

Why do I think this matters?

Just this week, the Office for National Statistics confirmed how important this generation is for our economy.

In their analysis of the labour force, the ONS place a value on the ‘human capital’ we have in the UK.

Growth doesn’t just come from business investment or infrastructure. It comes from the talents and productivity of people.

And as the Office for National Statistics point out this week, while the under 35s represent much less than half of the population (40.1 per cent), they make up two-thirds of our country’s human capital (66.2 per cent).

They are a vital asset for our economy – and we neglect this generation at our peril.

As Ed Miliband has said, if we are to deliver a high-productivity, high-skilled, innovation-led economy, we need to harness the abilities of the coming generation and cherish their contribution.

Yet time and again, George Osborne and David Cameron have disadvantaged those in their 20s and 30s, fostering conditions which many feel have not advanced since their parents were starting out.

Just look at the Government’s record over recent years:

We know from this month’s record low pay growth figures that all working people are suffering a severe cost-of-living crisis under this Government.

But the picture for the under 30s is even worse, with the youngest seeing their wages fall by over ten per cent since 2010.

New analysis from the House of Commons Library shows that average weekly earnings have fallen far more markedly for the under 30s since the last election than for older age groups. The figures show that since 2010 the real terms weekly incomes of 18-21 year olds have fallen by 10.3 per cent, and weekly earnings of the 22-29 age group are down 9.4 per cent.

This compares to falls of 6.8 per cent for those in their 40s, and 4.8 per cent for the over 60s.

The pay gap between age groups has increased significantly under George Osborne. At the last election the gap between those in their twenties and those in their forties was £5,304 – it has grown to £6,318.

Meanwhile, the Bank of England last week halved their forecast for wage growth this year. And the Office for National Statistics announced that pay rises are at a record low. It’s no wonder, then that the Chartered Institute for Personnel and Development found in their recent survey that starting salaries are expected to remain low for the rest of the year with only 2 per cent of employers offering an above-inflation pay rise to new recruits in the past year.

The Institute for Fiscal Studies say that those born in the mid-1980s have lower incomes than those born either five or ten years earlier at the same age.

The short-term approach to budgeting taken by this Government will end up costing the country far more in the long run and has hit the youngest the hardest. Apprenticeships for the under 25s have been devalued and their numbers are falling.

And let’s not forget the record of David Cameron and Nick Clegg when it comes to higher education finance. Tuition fees trebled to £9,000 and graduates in this country are sharing a collective £62 billion of student loan debt.

Yet there is chaos in the financing of our universities, with so much of this new money now being set aside to provide for loan write-offs, it turns out that the tripling of tuition fees to £9,000 might not actually be saving the taxpayer anything at all – after all that! And Ministers have hinted that this £9,000 cap might have to rise again.

It used to be the norm to move from graduation into a career – but the period of early work experience with minimum or zero earnings has extended. Many of today’s young people are likely to still be trying to pay back loans into their early fifties. When the Tories and Lib Dems trebled tuition fees, they didn’t bank on the ever diminishing earnings of those destined to pay them.

Generation Rent will not forget the burden left around their necks by the decisions of Cameron and Clegg.

We know that long term youth unemployment leaves a lasting legacy – and while employment in aggregate is higher, the claimant count for those young people out of work for more than 12 months is up 42 per cent since the last election and we still have an unacceptably high 750,000 young people out of work in this country.

But, as Ed Balls has said, the impact of the current labour market goes beyond those struggling to find employment.

The world of work has changed rapidly, even in the past few years. When this generation manages to find work, they can encounter a world of zero-hours contracts, agency working and temporary assignments often disguised as ‘self-employment’.

The growth of income insecurity and uncertainties about earnings from month to month blight the capacity for long-term planning and is incredibly destabilising.

To get a mortgage you need to prove certainty of earnings year by year.

Planning childcare from one week to the next is hard when you might not find out your working hours until the morning you’re due in.

Starting a family may even be made harder because of this financial insecurity. It is quite startling when the Office for National Statistics say, as they did last month, that “factors which could have had an impact on fertility levels in 2013 include uncertainty about employment and lower career and promotion opportunities (such as temporary, part-time, or zero-hours contracts)”. The ONS made this striking remark in response to the news that there were 30,000 fewer births in England and Wales in 2013 than the year before – the biggest drop for nearly 40 years.

At so many levels, then, economic insecurity and uncertainty seems to be causing this generation to delay or postpone a whole series of lifetime decisions.

And then look at this Government’s record on housing.

Rising demand has been combined by the lowest supply of new housing in peacetime since the 1920s, making affordability increasingly difficult.

A report by the Halifax on ‘Generation Rent’ this spring found that 36 per cent of those aged between 20 and 45 feel they have no realistic prospect of owning their own home in the next five years. As the authors put it, “we may be heading towards the point where the aspiration to own a nice home will be replaced by the aspiration to simply live in one.”

For many in this generation, renting is not an option but the only choice available. And this Government’s failure to tackle rip-off rental markets is making this choice an increasingly unaffordable one as well.

These are challenges so many at the top of the Government have never had to face let alone understand.

In short, the Millennial Generation are losing out on career stability, missing out on wages that rise more than prices, struggling to save, missing out on the chance to own their own home, and paying more for their education in the process. This is a peer group becoming wary of big purchases or life decisions that depend on a financially secure future. Statistics suggest they’re even postponing marriage and moving back in with parents; nearly half a million more 20 to 34 year-olds are living with their parents than at the last election, a rise of 16.3 per cent.

A Conservative government will only make those headwinds stronger for this generation; their priority is to give tax cuts to those already at the top and hope that wealth just trickles down. But think of the impact another five years of this same approach will have:

• Continuing neglect of housing supply and a growing affordability crisis.
• The prospect of costlier assets for the younger generation and larger debts to repay.
• Inaction on the key issues which must be addressed for the long-term good of society, including the threat from climate change because of a refusal to take decarbonisation seriously.
• A student finance system not fit for purpose.
• A cost-of-living squeeze with little end in sight.

In contrast, we need an agenda based on fairness for all – which values the contribution of all in society including those in their 20s and 30s.

First, Labour will provide a package of measures targeted at creating the best possible start for young people, whether going forward to university or focusing equally on those who don’t go to university – the young people who are too often the forgotten 50 per cent. The opportunity of education right up to the age of 18 means we can create a curriculum that is rigorous and relevant with English and Maths studied to 18, not 16, the choice of traditional academic study or a new technical baccalaureate – a gold standard qualification at 18 which can lead to quality apprenticeships and good quality jobs. And a Jobs Guarantee and help with training for those under 25 year olds who find themselves out of a job for a year or more.

Second, giving Generation Rent a fair chance to get ahead means we must take on the vested interests of those who exploit their situation and take advantage of their predicament. That’s why our plans for reforming markets are designed to level the playing field in favour of working people.

In the workplace, a ban on exploitative zero hours contracts.

On housing, we must tackle failures in housing supply and addressing market abuses which are making it so hard for today’s young people to get on the housing ladder. Labour will prioritise building 200,000 homes a year by 2020, including exploring ways to boost supply such as a Help-to-Build scheme for SME house builders. This drive on new housing starts is a serious commitment to tackling the imbalance between supply and demand which is the cause of the affordability crunch experienced by so many in their 20s and 30s today.

And we will stop the lettings agents who charge rip off fees not just for the landlord but for the tenants too.

Third, we will switch resources to target help where it is needed most with any changes being fully funded.

We will help make it pay to be in work, introducing a lower 10p starting rate of income tax paid for by levying a mansion tax on those ultra-high value properties worth more than £2 million; a fairer approach for those working hard trying to make ends meet.

We can introduce Make Work Pay contracts and return a share of the tax proceeds and tax credit savings to every employer who moves to offer a Living Wage.
We can expand free childcare for those in work, funding an increase from 15 hours of nursery care for three and four year olds to 25 hours each week by collecting a further £800million from the bank levy.

We can pay for the jobs guarantee for the under 25s by repeating the banker bonus tax that was so necessary in 2009 and is needed again.

Here as elsewhere, we need big reforms – not big spending.

Fourth, it is time we acknowledged the squeeze on Generation Rent and began to discuss and monitor some of these concerns in a more coherent way. We need to be incorporating these questions into our analysis of economic policy and ensuring that these voices are properly heard in government.

We need a government that will actively listen and respond to this agenda. But, apart from a few notable exceptions such as the Intergenerational Foundation, the under 35s don’t have many representative bodies, pressure groups or campaign organisations marshalling their case. My Shadow Cabinet colleague Ivan Lewis and I are looking closely at the state of engagement between young people and government.

But what more could be done here?

It was the last Labour Government that, quite rightly, created the ‘UK Advisory Forum on Ageing’ in 2009 to advise on cross-Government
policy development for older people.

But I now believe that the next Labour Government should, in a similar way, establish a ‘UK Advisory Forum on the under 35s’ to assess the impact of policy on Generation Rent and improve coordination and accountability.

We have to do more to look strategically at the economic, social and environmental questions which risk burdening this generation and have a way to improve dialogue within government on how we can unlock this vast stock of human capital to improve our international competitiveness and ensure Britain offers the best deal for those starting out here.

Because this is a generation we actively want to succeed and to stay living here in our country and contributing to our economy.

We should aim for Britain to be the best place in the world to start a career, start a family, and fulfil personal ambitions.

Not everyone in their 20s and 30s is struggling – but a great many are.

And while some will make the case for reordering the distribution of resources and benefits between the generations, that is not what I am arguing for.

Today’s younger generation have similar ambitions to the older generation and they just want as good a chance as their parents had.

They want an economy where enterprise is rewarded and where a fair day’s work gets a fair day’s pay.

They want an economic recovery that is fair for all and that is sustainable in the longer term.

And they know that the defining challenge of our times is to reconnect the wealth of the country as a whole with their finances and their families.

Everyone benefits if this generation succeed – so Labour will do more to support the ambitions and aspirations of Generation Rent.

I believe that the choice at the next election is a great one – and one which matters greatly for those at the start of their working lives.

Politics needs to pay more attention to those in their 20s and 30s. And, in turn, they will need to reflect on the choice at the next election. Because this is a generation for whom there is so much at stake.

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