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Yahoo
3 days ago
- Business
- Yahoo
Can Nigel Farage boost Britain's birth rate?
As Sir Keir Starmer continued to drag his feet over one of the most contentious policy issues among Labour MPs and voters, Nigel Farage spotted an opportunity. Proclaiming during a speech last week that Britain had 'lost our sense of focus of just how important family is', the Reform UK leader unveiled plans to lure frustrated Labour voters while also attempting to arrest a decline in the UK's birth rate. Farage pledged that an elected Reform would scrap the two-child benefit cap and introduce a transferable tax allowance for married couples, in a bid to encourage people to have children. 'This is part of a bigger package and policy that we are putting together to try and make the family a more important element in British life,' said Farage. It marks the party's move into pro-natalist policies. This embedded content is not available in your region. Reform's proposed transferable tax allowance for married couples takes inspiration from central Europe. During his time in office Viktor Orbán, the Hungarian prime minister, has placed significant focus on the importance of birth rates and traditional families. Earlier this week, Farage said he was 'not moralising' on the significance of marriage and added that having been divorced twice his 'track record was not so good on this'. Reform's policy would exempt one partner in a marriage from paying tax on the first £25,000 of their salary. Ben Ramanauskas, a senior fellow in economics at the Policy Exchange, says the proposal would bring the UK 'into a territory where most European countries are'. He adds: 'They have a much more generous system when it comes to taxing households and families.' However, Ramanauskas cast doubt on the idea that the measure could encourage couples to have children: 'The proposal itself won't have much of an impact on what Farage is aiming for in terms of hoping to increase the birth rate.' Reform's plans also miss out a key group of would-be parents. More than half of children in the UK are born to couples out of wedlock. So with the transferable tax allowance only reserved for married couples, the baby boosting effect of the policy is unclear. The party has also said it would scrap the two child benefit cap, a pledge which is estimated to cost £3.4bn, according to the Institute for Fiscal Studies. Tomáš Sobotka, deputy director at the Vienna Institute of Demography, says abolishing the cap would help to lift children out of poverty but its impact on Britain's birth rate is likely to be 'marginal'. 'Most parents today don't desire more than two kids so it's a select group of women and families who are having a third or a fourth child,' he says. 'Providing a bit more in services … will not change fertility planning among many couples.' In Hungary, Orbán's attempts to fix the country's birth crisis mean it spends around 5pc of its GDP on measures aimed at encouraging couples to have children. The most significant of these measures is the country's large tax breaks. Currently mothers under 30 pay no income tax and mothers with three or more children are exempt from paying income tax for life. Orbán has also pledged to extend the measure to mothers of two children by January 2026. The government also offers loans to newly-weds that can be partially or fully written off if the couple has two or three children – as well as subsidies for family car purchases and housing. Despite Orbán's significant spending and hopes of a baby boom, Hungary's birth rate stood at 1.52 children per woman in 2022, in the UK it was 1.53 children per woman in 2021. For context, a country needs a fertility rate of 2.1 children per woman to ensure it has a stable population, without immigration. 'In the last few years Hungary has experienced fertility declines to the same extent as other countries and it now has exactly the same fertility rate as the European average ... from that perspective Hungarian policies are not bringing in tremendous success,' says Sobotka. But Orbán's focus on large families is helping to deliver an uptick in the number of households with three or more children, Sobotka adds. In the Nordics, the picture isn't any clearer. Finland pioneered the introduction of family friendly policies including parental leave and childcare from the 1980s onwards. The country reported a rise in its birth rates in the 1990s despite going through a financial crisis. 'Introducing these kinds of policies if they are long term … longer parental leave and especially affordable childcare have been shown in a wealth of studies both in the Nordic countries and from other countries to be associated with somewhat higher fertility,' says Anna Rotkirch, of the Family Federation of Finland's Population Research Institute. However, she warns these measures 'are not enough for today's situation,' and that 'there's no silver bullet policy.' Indeed, the initial boost to Finland's birth rate in the late 20th century has waned and since 2010 the country has seen its birth rate decline by a third. Yet, Rotkirch says that while government spending and Reform's proposed policies might not have much of a demographic impact they were an important element in reducing child poverty. 'The cost of parenting is real and it is also economic,' she adds. 'Why do we have a society where you get poorer if you have a child?' Over in South Korea the picture is even more challenging. In May 2024, the then-president Yoon Suk Yeol asked for the parliament's cooperation to establish the Ministry of Low Birth Rate Counter-planning. 'We will mobilise all of the nation's capabilities to overcome the low birth rate, which can be considered a national emergency,' he said. The country has gone through a raft of measures including baby bonuses, subsidised fertility treatments and housing assistance but the country's fertility rate stood at 0.78 children per woman in 2024. Melinda Mills, a professor of demography at Oxford University say: 'They've also shown that throwing a lot of money at it doesn't work so you have to get to the root of people's lives. What are their work hours? Where do they live and work? Where's childcare?' One nation that has a slight edge in the birth rate compared to its European neighbours is France. Mills added that France's more comprehensive package of subsidised childcare, parental leave and school support goes some way in encouraging couples to have children. Indeed the measures seem to be having a small effect on the country's fertility rate, which was 1.8 children per woman in 2021 compared to the EU average of 1.53 during the same year. 'It's harder work than throwing a baby bonus and trying to think you could do a silver bullet but actually creating an ecosystem that has childcare, that has good maternity and paternity leave, has a good work-life balance – that's where France has done very well,' says Mills. However, it's clear that there is no one pro-natalist policy which will act as a catalyst to boost birth rates. While Farage's proposed Hungarian-style tax breaks look unlikely to persuade couples to have children, Mills explained that measures which addressed quality of life were likely to be more impactful. 'People need a good life, they need good jobs, be able to get a house, childcare,' says Mills. 'It's about wellbeing, it's about work-life balance. That's not as sexy … but these are the things that have been shown to be more effective.'
Daily Mail
7 days ago
- Business
- Daily Mail
Sums behind Nigel Farage's vow to spend £85billion if he wins the next election 'are implausible', experts say
Nigel Farage refused to rule out scrapping the state pensions triple lock yesterday as he struggled to defend plans for a spending splurge of up to £85billion. The Reform UK leader unveiled a string of policies in a major speech, including scrapping the two-child benefit cap, fully reinstating winter fuel payments and raising the tax-free income allowance to £20,000. He also pledged a transferable marriage tax allowance if his party wins the next election, aimed at incentivising marriage and encouraging people to have more children by making it more affordable. It would exempt one spouse from paying any tax on the first £25,000 of their income, as revealed by the Mail. But the Conservatives branded the package 'fantasy' economics and 'Corbynism in a different colour' because of the 'billions in unfunded commitments'. Experts said it could cost as much £85billion, a figure that dwarfs the £45billion of unfunded tax cuts announced by former Tory Prime Minister Liz Truss in her disastrous 2022 mini-Budget. Even leading Reform activist Tim Montgomerie, who defected from the Tories after founding the ConservativeHome site, admitted: 'The sums don't add up.' But Mr Farage insisted the pledges were 'credible' and could be paid for by scrapping the Net Zero agenda, which he claimed was costing £45billion a year. He said an extra £4billion annually could be saved from ditching accommodation for asylum seekers by deporting them and £7billion by ending the public sector's diversity, equity and inclusion (DEI) drive. A further £65billion could be saved over five years by cutting quango bureaucracy by 5 per cent, he added, giving an average saving of £69billion annually overall. But experts said raising the basic rate of income tax threshold to £20,000 could alone cost up to £80billion. At present, workers pay the 20 per cent rate of income tax on everything between £12,570 and £50,270. Lifting the two-child benefit cap would cost an extra £3.5billion and reinstating the winter fuel allowance £1.5billion. The eagerly anticipated speech was the most policy-heavy since Reform won four million votes and five seats last July. Asked if he had a 'magic money tree', Mr Farage admitted his sums were 'slightly optimistic' but added: 'We can't afford Net Zero, it's destroying the country; we can't afford DEI, it's actually preventing many talented people from succeeding; and we certainly can't afford young undocumented males crossing the English Channel and living in five-star hotels. 'You can argue about numbers adding up. You can probably argue that at no point in the history of any form of government has anybody ever thought the numbers added up. 'I think what I'm trying to do today is give you an idea of direction of policy, of priorities, of what we think is important and we think it's going to cost and how we think we can pay for it. I believe what I've presented is credible.' Dismissing a comparison to Ms Truss's mini-budget, he added: 'Liz Truss's dramatic failure was not to propose any cuts.' But he refused to guarantee keeping the pensions triple lock, raising the prospect that Reform could launch a raid on pensioners to help pay for the pledges if he comes to power, which polls suggest is possible. He admitted: 'The triple lock is not something we've addressed as yet.' The measure guarantees state pensions rise each year by whichever is highest of the annual rate of inflation, average growth in earnings or 2.5 per cent. Estimates suggest £10billion could be saved if it was scrapped and pensions were indexed to prices or wages alone. Mr Farage also defended plans to scrap the two-child benefit cap. But Tory leader Kemi Badenoch said it was right to keep the cap as it was unfair to expect taxpayers to subsidise people having large families they cannot afford. Mr Farage yesterday responded: 'This is part of a bigger package and policy we are putting together to try and make the family a more important element in British life.' Sir Mel Stride said Mr Farage had 'abandoned hardworking families who live within their means'. The Tories' shadow chancellor added: 'Farage has announced billions in unfunded commitments with fantasy ways to pay for them. It's Corbynism in a different colour.' Stuart Adam, of the Institute for Fiscal Studies, insisted raising the basic income tax rate threshold could cost up to £80billion. Lib Dem leader Sir Ed Davey branded the Reform package as 'Truss-onomics on steroids'.
Telegraph
27-05-2025
- Lifestyle
- Telegraph
Farage to scrap net zero to fund giveaway for families
In a bid to 'make the family a more important element of British life', Mr Farage pledged to introduce a new transferable tax allowance for married people. This would exempt one half of the couple from paying tax on the first £25,000 of their earnings, according to the Daily Mail. At the moment, working people pay the basic rate of income tax on everything between £12,570 and £50,270. Asked if he wanted to see the marriage rate go up and the divorce rate go down, Mr Farage joked: 'I am not the Pope.' But he said there was plenty of evidence that showed children who grow up in stable families where parents remain married 'do better in life'. He also attacked current abortion laws, arguing it was 'ludicrous' that a premature baby can be saved at 22 weeks while some terminations are allowed at 24 weeks. However, he stressed that this was his personal view and not official Reform policy. Asked if he would be in favour of changing the limits, he said: 'I genuinely believe these are issues of personal conscience. I am pro-choice. 'But I think it is ludicrous, utterly ludicrous, that we can allow abortion up to 24 weeks and yet if a child is born prematurely at 22 weeks your local hospital will move heaven and earth and probably succeed in that child surviving and going on and living a normal life. 'I believe there is an inconsistency in the law. I believe it is totally out of date. I wouldn't particularly want anyone around me to agree with that or disagree with that. I would leave it up to them. I think our current situation on this is irrational.' Sentence was 'absolutely excessive' Mr Farage also said Lucy Connolly, a mother jailed for a tweet about the Southport attacks, should not be in prison. Connolly, a former childminder and the wife of a Conservative councillor, was jailed for 31 months in October after pleading guilty to a charge of inciting racial hatred. Mr Farage, the leader of Reform UK, said the sentence was 'absolutely excessive'. 'I want to make it absolutely clear: Lucy Connolly should not be in prison,' he told a party event in central London on Tuesday. 'The sentence that was given to her was absolutely excessive and while she should not have said what she said, understand there were millions of mothers at that moment in time after Southport feeling exactly the same way.' Judges threw out an appeal brought by Connolly, 42, last week, meaning she will not be released before August.
