The writer is the Conservative MP for Tonbridge

For centuries, this country has upheld an unspoken social contract. That each generation will create a better future for the next. That deal is now broken. This is the result of decades of policy choices that have systematically benefited one generation — the baby boomers — initially stimulating the economy but now choking it as wealth is transferred from young to old. Two bad policies in particular have influenced this trajectory. The first was a set of regulatory changes over two decades ago that in effect compelled pension funds to liquidate their investments in domestic UK companies and replace them with government bonds.  

That decision destroyed the core social contract that makes pensions work: the idea that the old profit from the energy of the young. Instead of fuelling living minds and ideas, wealth has been channelled into the dead hand of the state through gilts. Today, over 60 per cent of private sector defined benefit pension assets sit in gilts, with just 1 per cent in UK equities. This has starved British enterprise of long-term domestic capital, driving innovative companies like Arm Holdings and DeepMind to seek foreign investment, siphoning the wealth they create overseas.