Intergenerational inequality

Sir, – Gerard Howlin is right to highlight the challenge of funding State and public sector pensions (“Young are caught in a grotesquely unfair pensions trap”, Opinion & Analysis, January 5th).

His response to the challenge is, however, quite wrong. Why, as he states in his column, must more be asked of older people with decent incomes and significant assets? Why older people specifically?

There is indeed intergenerational inequality, but that is not a real issue in itself. It is rather an aspect of a more fundamental inequality – namely, income and asset inequality. The only fair way forward is to ask more of everyone with decent incomes and significant assets - young and old, working and retired. This would be best achieved by the introduction of a third, higher band of income tax. Any other approach to alleviating inequality is merely a contrivance to avoid the tough but necessary political decision to raise taxes generally on the better-off.

The idea canvassed in Gerald Howlin’s column that retired people should continue to pay PRSI after retirement is particularly misjudged. It would have the undesirable effect of turning it into another income tax, instead of its present character as something that qualifies you for future entitlements (the State pension, unemployment benefit, etc). That would destroy the public’s acceptance of it, in exactly the same way as we have never accepted the USC. – Yours, etc,