In my generation of baby boomers, and probably the next, most would say that they planned and worked hard to give their children a better and easier life, with better opportunities than we enjoyed ourselves.
However, it seems that we have mostly failed. A recently released report by the Grattan Institute, Generation Gap: ensuring a fair go for younger Australians, suggests that younger generations are not making the same economic gains as their predecessors.
Clearly, it is harder for younger generations to buy a home, and perhaps secure a job, afford an education and so on. Economic growth has been slow since the GFC, wages have been flat, our population is ageing, and issues like climate change have been pushed forward for the young to deal with. The burden of these changes has fallen disproportionally on the young. The pressures are due to both economic and demographic factors, but also to several policy choices made by governments, and by us as a nation.
Older Australians today have substantially greater wealth, income and expenditure compared with Australians of the same age decades earlier. The wealth of households headed by someone under 35 has barely improved since 2004. While spending on essentials such as housing has increased by every age group, younger people have been cutting back on non-essentials including alcohol, clothing, furnishings and recreation.
Two key economic factors here have been flat wages and rising "underemployment". While our measured unemployment rate has improved, underemployment - that is not being able to get as much work as they want - has risen substantially. These two factors have hit younger Australians disproportionally hard. Older people are more likely to be "cushioned" from these factors having established their careers, and with probably other sources of income.
Grattan refers to what they call an "implicit generational bargain", with working-age Australians being net contributors to the annual budget, helping to support older Australians in their retirement. They suggest that this "bargain" is breaking down as a series of policy choices, in both tax and welfare, over recent decades has distorted the system in favour of older Australians.
For example, tax-free superannuation income in retirement, refundable franking credits, special tax offsets for seniors and the like, mean that older Australians now pay much less tax than other Australians on the same income. There have also been substantial increases in average pension and health payments for households aged over 65.
The bottom line is that say a typical 40-year-old today contributes much more towards the retirement of others through taxes than did his or her baby boomer predecessors, and this is more than this 40-year-old contributes to preparing for their own retirement through compulsory super. Clearly, this is not the sort of Australia most of us would have wanted - nor indeed thought that we were creating. We certainly didn't plan on our younger generations falling behind.
Clearly, this is not the sort of Australia most of us would have wanted.
Many older Australians are now being forced to do more to help their children and grandchildren in both financial support and care - in housing, for example, the "Bank of Mum and Dad", or in the provision of childcare, to support both parents working, and so on. This all helps, but it is selective, and it doesn't solve the overall problems. In fact, inheritance can compound the problem of overall inequality.
Government has a significant role to play, in part to reverse the decisions it has taken in the past, then mostly for perceived short-term political gain, only to have compounded longer-term structural issues and challenges.
Indeed, so much of short-term politics over recent decades has simply just pushed the "big issues", such as say housing affordability and climate, down the road, while often favouring older Australians simply in the hope of "tying up their vote".
Hence, issues such as broad-based reform of the tax and transfer systems that address these inequities and inefficiencies that have skewed these systems against younger and poorer Australians, are an imperative, as is a genuine strategy to improve housing affordability, working on both demand and supply factors, at both state and federal levels. However, the greatest policy failing has been to fail to meet the climate challenge, as a matter of urgency, to ensure our transition to a low carbon society by the middle of this century.
John Hewson is a professor at the Crawford School of Public Policy, ANU, and a former Liberal opposition leader.