Growth in median retirement incomes calls for significant changes to pensions, tax, welfare and social policy, according to a new report published by left-leaning think tank the Fabian Society today.

The study calls for a review of policies in all areas that advantage older people as a category. Since the financial crisis, it notes, real middle incomes overall have fallen five per cent, while rising five per cent in retired households, continuing existing trends; reforms by the last government helped boost middle income pensions, as will the introduction of the flat-rate single state pension. Median disposable income for pensioners may overtake that of the general population in the next decade, the report says.

Author Andrew Harrop writes: “All policies which appear to give special advantages to older people as a category should be reviewed, because in financial terms alone, older people are no longer special.”

Instead he calls for a “presumption of equality” in how public policy and services treat different age groups.

The report recommends a number of changes. Among them are the scrapping of the current “triple lock” for the state pension, which guarantees pension increases will be the greater of inflation, average earnings or 2.5 per cent.

It also calls for an end to the special treatment of older people in the tax system, endorsing the last budget’s removal of age-related income tax thresholds for pensioners – “a sensible policy which caused a media outcry”. The government should consider following this by applying national insurance to earnings after state pension age and ending the tax-free lump sums on private pensions, it argues.

“None of this will be free from controversy, but a gradual, staged increase in the tax burden on older people could be presented as part of a ‘grand bargain’ to pay for universal health and wellbeing services in our rapidly ageing society,” it notes.

While calling into question some smaller benefits such as free TV licenses, bus passes and the Winter Fuel Payment for better-off pensioners, however, the report strongly endorses universal entitlements. It notes that universal entitlements make up 70 per cent of the group’s income, once the NHS and state pension are considered.

“This underlines the vital importance of universalism as part of the long-term future of the welfare state.”

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