In Ponzi scheme Britain, parenthood is a luxury
The promise that if you work hard, you will be able to own a home and raise a family is breaking down in real time, says new dad Simon Clarke
I am about to do something that an uncomfortable number of British men cannot: become a Dad again.
A little boy, since you ask. It is a lovely personal moment. But it is also a brutal policy reminder – having children at all, or having as many children as they want to have, is something too many couples simply cannot afford to do.
Over recent years, it has become impossible to ignore that Britain is no country for young people. We are quietly running a demographic Ponzi scheme in which a shrinking cohort of workers is asked to carry the costs of an ageing society, record health and care pressures, and a tax burden at a post-war high. The promise that if you work hard, you will be able to own a home and raise a family is breaking down in real time.
A shrinking cohort of workers is asked to carry the costs of an ageing society, record health and care pressures, and a tax burden at a post-war high
Housing sits right at the centre of this anti-social contract. For at least a generation, we have not built the homes we need, with the result that Schroders has found that UK house prices are at their most expensive relative to incomes since the 1870s, while rents have also spiralled out of control. A paper published last week by Benjamin Couillard of the University of Toronto shows just how sharply housing costs impact fertility rates. Looking at the United States, Couillard found that rising housing costs since 1990 are responsible for 11 per cent fewer children born in the US into the 2010s, or 51 per cent of the total fertility rate decline between the 2000s and the 2010s. It would be fascinating to see a comparable study in the UK, where the results might be even more sobering.
A broken social contract
Likewise, we need to control immigration. Chris Worrall’s recent paper for Onward, also published last week, models what will happen to prices and rents in England and Wales under different migration paths over this Parliament. In the high migration scenario, with net inflows at four hundred thousand a year or more, prices still rise and rents still rise, even with higher housebuilding (itself a debatable proposition). The gains look modest on a spreadsheet, a couple of extra percentage points on prices and around two on rents by 2029, yet they would land squarely on low earners and renters.
In Chris’ model, reflecting the path Denmark followed on migration, energy and industry, prices drift downwards and rents relax. Not a crash, but a slow exhale. Real incomes improve. Housing becomes slightly less of a contact sport.
There are two lessons here. First, you cannot fix the consequences of a broken social contract by importing ever more people into the same broken system. If your housing supply is constrained, your energy is expensive, your planning system resembles the late Roman Empire and your tax burden keeps creeping up, adding heads without adding capacity makes it harder for everyone to form families.
Second, if you do want high migration for economic reasons, you need an adult plan for where people will live. That means serious housing reform, not the half-hearted theatre we are seeing from Steve Reed. Having strutted about promising to bulldoze blockers, the Housing Secretary has quietly shelved National Development Management Policies, the one reform that looked capable of giving England a clear, national rulebook.
Ultimately, if we want a country where more people can become parents, we need a housing system that actually builds, a migration policy that matches numbers to capacity, and a tax and welfare system that recognises children as a national investment rather than an afterthought. Wish me luck with the nappies!
Simon Clarke is the Director of Onward, the centre-right thinktank