Lord Willetts is Executive Chair of the Resolution Foundation. He is a former Minister for Universities and Science.

The big challenge facing British politics today is obviously Brexit. But in some ways, the main parties, and especially the Conservative Party, face an even bigger political challenge – bridging Britain’s age divide. This issue, which I wrote about a decade ago in my book The Pinch, has risen to the fore again thanks to an excellent report published yesterday by the think-tank Onward.

Onward show that age rather than class is now the best predictor of voting intention. Labour had a 29 per cent lead among 25-34 year olds in the 2017 election and Conservatives had a 36 per cent lead among over-65s. There are a host of other factors which might lie behind this age gap – older people are less ethnically diverse, less likely to live in cites, less likely to have a degree. But even after allowing for such effects there is a still a fundamental age gap in voting.

This need not itself be a problem for the Conservatives (the focus of Onward’s work). If young people vote Labour and, as they go through the life cycle, older people vote Tory then as the population ages there might even be an electoral gain for a party appealing to older voters. But this depends on voters turning Conservative as they grow older. And that is not happening.

Instead, the Conservative Party is retreating towards a cohort of ever older voters. The “tipping-point age” at which a voter is more likely to be Conservative than Labour used to be 34. It went up to 47 at the 2017 General Election and is now 51 years old. So voting Tory is not just a life cycle effect: instead a cohort of older Tories is gradually being replaced by succeeding cohorts who are more inclined to Labour. That is the existential threat which Onward urge Conservatives to face.

“Younger voters” are obviously not a homogenous group, and neither are their voting intentions. Many of them are in the middle of British politics – slightly “left” on economic and welfare issues, and slightly “right” on cultural and national issues. But that is not, of course, where the Conservative Party is seen to be.

There are some things that both parties should prioritise to win young people over. Helping them get started on the housing ladder is crucial. And that means building more homes in the places where they want to live.

The Onward polling suggests some other things young people want – more conditionality in immigration, to reduce the gap between rich and poor, more technical education and backing for people on average wages.

Many Conservatives will be encouraged by younger voters’ desire to keep their own money, rather than increasing tax, and to make public services more efficient, rather than spend more on them. Rather less encouragingly, this may reflect younger voters getting a pretty raw deal from the welfare state in recent years, as it is increasingly focussed on older people. Working age benefits have now entered their fourth year of a cash freeze, while state pensions increase under the triple lock. Just imagine the politics of treating benefits for pensioners the same way as benefits for working age families. And the NHS is mainly used by the over-60s.

This all suggests a rather acute dilemma for Conservatives – with even tougher choices than those set out in the report. After all, Onward’s polling shows that 70 per cent of voters believe that Britain needs a ‘radical change of direction’.

Older voters are the heaviest users of public services and the welfare state is increasingly for them. The areas where there are concentrations of older voters now shifting to Conservatives are heavily dependent on public services. This demographic shift is expensive, too. An ageing population and rising healthcare costs mean that the cost of maintaining the current welfare state will rise by £36 billion a year by 2030. Someone has to pay for this greying state.

What is the right way to meet this demographic challenge? Should we cut back public services to satisfy younger voters’ desire for taxes to be held down? But then core Tory voters are losing out. Or should we levy higher taxes on the working age population to pay for increased public spending on older voters? That cuts across the views of the younger voters that the Party needs to win over. And finding an extra £36 billion a year through income tax alone would require a huge increase in headline rates that no party would countenance.

There is of course another way to square this circle. What if older people were themselves expected to make more of a contribution to the public services they use? This could be done by reforming council tax so that high-value properties pay more, or expecting wealthy pensioners to make more of a contribution to the costs of social care. That is the dilemma which the Conservative Party’s 2017 election manifesto tried to confront. It may have been handled ineptly, but the underlying dilemma has not gone away.

That is where the debate is heading, whichever party is in power over the next decade. Choosing which public services you want to maintain, or what to tax more – income or capital – will be the real test of Britain’s age divide.