This country is governed primarily for the benefit of older people, and electoral demographics mean that this is unlikely to change anytime soon. So totally does this cohort dominate the discourse that even those protesting against it, via Exinction Rebellion or Insulate Britain, tend to be old as well.
But there’s only so often one can write the same despairing piece; only so many times one can point out that the Conservatives are storing up a richly-deserved reckoning for themselves if they continue to pretend that the South doesn’t need millions of new homes.
So let’s instead indulge in a little fantasy and wonder what, in some mirror universe, a pro-young people policy agenda might look like.
Obviously, comprehensive planning reform and a major housebuilding boom would be idea. But absent some sort of putsch, the Town & Country Planning Act and all its malignant consequences will be with us for some time to come.
But even so, there are definite positive steps that ministers could take to make it just that little bit easier for people to get onto the housing ladder.
Take the Lifetime ISA (LISA). Introduced in 2016, this is a specialised savings vehicle intended to help young people save for their first home (or retirement). For every £4 you put into it (up to £4000pa) the Government puts in £1. Seems pretty good, right?
Now, let’s play a game. When LISAs were introduced, the cash value of the home you could buy with them was capped at £450,000. According to the Office for National Statistics (ONS), in December 2016 the average UK house price was £220,000 (£236,424 in England).
If you picked ‘£450,000’ then well done, there’s no getting anything past you. Between December 2016 and December 2021, the UK average house price rose by 25 per cent (24.1 per cent on the English values). The power of the official savings vehicle, not at all.
Bonus points if you noticed that neither of those sets of averages includes London. The average property value in London in 2016 was £483,803 – already over the limit – and in 2021 stood at £521,146. There is, of course, no London Weighting on the LISA limit.
So the first plank of our agenda would be simple: take the existing vehicles the Government has set up to help young people save for housing and make them fit for purpose. If there is any reason to keep the maximum value cap, index-link it (from 2016, obviously). Apply a London-specific or regional weighting to it, as we do with public sector pay, so that it reflects the state of the market.
And in order to help family formation, allow couples buying together to pool their value caps. So, for example, two professionals buying together could max out on a £900,000 property, i.e. the price of a family home near a school that cost less than £300,000 in 2000, in the sort of town I grew up in.
Speaking of families, the next thing our pro-youth ministry would do would be to introduce more measures which make it easier for working-age people to have children and support families. James Boyd-Wallis wrote an interesting piece yesterday about the UK’s ‘baby bust’ which set out some of the issues.
However, our ministers would be a bit more radical than simply opening up the market for childcare provision, although cutting the regulation that pushes this country’s costs so much higher than the European average would be a no-brainer.
Moreover, making professional childcare the only option, as at present, seems to be as much about freeing people up to work rather than maximising their freedom to build their own arrangements.
In our mirror universe we’re going for a system that serves the best interests of families, not capital, so the policy would probably look a lot more like a cash payment to every household on a per-child basis. This could be spent on professional childcare or, importantly, used to as income support if one parent went part-time or stayed at home. It would be completely up to the parents.
Making this system universal would also remove one of the great iniquities of the old child-benefit system that preceded the two-child limit, which was that working people faced major financial pressure on how many children they could have whilst those on welfare did not.
Now we have a home-buying savings vehicle that is at least calibrated towards the housing market politicians are determined to perpetuate, and which better allows couples to pool their resources towards family homes. We also have a system of cash support to help them start populating those homes.
For our last trick, let’s do something about the iniquity of the current social care arrangements. Heaping taxes on working-age people to fund unlimited liabilities towards retired people is very much not on the agenda for our hypothetical pro-youth ministry.
Again, there are plenty of ideas floating around for how this might be fixed. Make older people invest their largely adventitious housing wealth in their own care; introduce a ‘bedroom tax’ on private property to encourage downsizing in areas that reject planning reform. But again, let us concede that nobody is going to be marching on the Grey Gate anytime soon.
Perhaps a sensible middle-distance solution would be moving towards something like the Japanese system. Under its terms, people over 40 are obliged to buy a form of social care insurance, but then not allowed to claim on it until they reach retirement age.
Introducing such a system here would mean that, for the first time, people were actually ‘paying in’ for the benefit they would eventually receive. It would also focus the burden on older workers, rather than heaping unjust marginal tax rates on graduates already burdened with paying off very high tuition fees.
It would also give the Government an opportunity to formally abolish National Insurance, whose main function at present is to generate a useful myth for older voters (and increasingly, Scottish and Irish nationalists, who think the rest of the UK will pay their pensions forever).
Such a list could be much longer of course. We haven’t looked at overhauling universities and student finance, or reforming the rules around noise complaints so if you move next to a pub or club that’s your problem rather than theirs. But the above would be a good start.