Key takeaways
The government’s new language suggests that home ownership, superannuation savings, and longevity have become evidence of unfairness, creating a convenient justification for higher taxes and reduced benefits for older Australians.
For decades, Australians have operated under a reciprocal system: today’s workers fund pensions and services knowing they’ll receive similar support later.
Data shows retirees receive about 75–80% of mid-career workers’ incomes after tax, hardly a sign of excessive privilege.
Past generations faced harsher economic conditions — sky-high interest rates, recessions, and single-income households.
Meanwhile, today’s younger Australians enjoy longer lifespans, higher incomes, better health, and stronger long-term wealth prospects.
Older Australians naturally hold more housing and super assets because they’ve had decades to accumulate them.
Taxing homes, super, or unrealised gains punishes people for doing what society told them to do: work hard, pay off debt, and save for retirement.
True fairness comes from boosting productivity, improving housing supply, and managing government spending, not shifting burdens between age groups.
Policies that pit young against old are economically misguided and socially divisive.
Imagine being told that after a lifetime of working hard, paying taxes, saving diligently, and raising a family, you’ve somehow become part of Australia’s problem.
That your success - owning a home, saving in superannuation, or simply living longer - is now evidence of “intergenerational unfairness.”
That’s the message emerging from the Albanese government’s latest policy buzzword - the so-called “intergenerational lens.”
What does an “Intergenerational Lens” really mean?
Following its economic roundtable last year, the government announced it would begin applying this “intergenerational lens” to future policy decisions.
At first glance, that sounds noble enough. Who doesn’t want fairness between generations?
But scratch the surface, and the implications become clear: more taxes and fewer benefits for older Australians, all under the banner of “equity.”
Apparently, those who’ve spent a lifetime building financial independence have committed the crime of saving too much, owning homes that have risen in value, and living long enough to need healthcare and aged care.
It’s a seductive political narrative - pit younger voters, burdened with student debt and rising rents, against retirees who appear asset-rich.
But as with most simplistic slogans, the truth is far more nuanced.
The myth of the “unfair” older generation
Economists Henry Ergas and Jonathan Pincus recently dismantled this notion in The Australian, arguing that what’s being peddled as “intergenerational equity” is little more than muddled thinking.
They point out that for over a century Australia has operated on a kind of fair bargain between generations.
- Working Australians fund pensions and aged care, knowing they’ll receive the same support when their time comes.
- Taxpayers contribute to the healthcare system, effectively insuring themselves for the future when they may need it most.
In other words, each generation helps the last, while expecting the same from the next. That’s not exploitation – it’s how civil societies work.
And the data tells a story that’s the opposite of what this “intergenerational envy” rhetoric suggests.
A study by the ANU found that today’s retirees receive post-tax incomes roughly 75–80% of those of mid-career workers – hardly evidence of vast privilege.
Moreover, many of those “benefits” attributed to older Australians (like healthcare or aged care) only apply if you’re unwell, disabled, or frail.
Does anyone really think a healthy 40-year-old would trade places with someone suffering from dementia just to “equalise” the benefits ledger?
Younger generations have it better than they think
It’s fashionable to claim that past generations had it easier, but let’s not rewrite history.
If today’s 40-year-olds had been that age in 1990, they’d have faced:
- A deep recession and double-digit unemployment,
- 18% mortgage rates, and
- A single-income household supporting more children on far less income.
Life expectancy was also far shorter - many men born in 1950 didn’t make it to 80.
By comparison, today’s 40-year-olds can expect to live 25 years longer, with vastly better health, education, and wealth prospects.
That’s not inequality - that’s progress.
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The real source of “inequality”? Asset envy
What this debate really exposes isn’t unfairness, but I believe it is asset envy.
Yes, older Australians tend to own more tangible assets, particularly housing.
But that’s natural in any functioning economy - younger people’s wealth lies in their human capital, their skills and earning potential, which they’ll gradually convert into property and super as they age.
And let’s bust another myth: the idea that superannuation is “lightly taxed” is simply wrong.
Australia’s system is one of the harshest in the developed world, taxing both contributions and earnings.
A medium-income earner typically loses about a quarter of their super to tax; for higher earners, it’s closer to half.
So much for “tax-free” retirement.
Housing: the convenient scapegoat
Then there’s housing - the political lightning rod of our times.
It’s true that older homeowners have enjoyed significant capital gains, but those gains are largely paper-based.
You can’t spend the value of your home without selling it, and if you do, you’ll face buying again in the same inflated market.
Some have called for taxing unrealised gains or including the family home in the pension assets test.
But these policies would punish people for doing exactly what the government has always encouraged - buying a home, paying off the mortgage, and living debt-free in retirement.
Besides, such measures wouldn’t create fairness - they’d simply shift the tax burden from retirees to their children and grandchildren.
A policy built on false premises
If we’re serious about improving life for future generations, the answer isn’t to squeeze those who’ve already contributed for decades.
Real reform means tackling the causes of stagnating wages, fixing housing supply constraints, investing in productivity, and stopping governments from spending beyond their means.
Yet instead, we’re seeing a political sleight of hand – a moral justification for fiscal desperation.
“Robbing the elderly to bribe the young” isn’t fairness; it’s cowardice dressed as compassion.
My take
The truth is, intergenerational fairness isn’t achieved by pitting one age group against another.
It comes from policies that grow the pie, not those that slice it thinner.
If the Albanese government’s “intergenerational lens” means punishing Australians who’ve done the right thing, saved diligently, and contributed for decades, then that’s not fairness. It’s folly.
And if that’s the new direction of Australian politics, we risk replacing the “lucky country” with something far less enviable – a nation that rewards envy instead of effort.
