Thomas Griffin is Global Ambassador for the Conservative Policy Forum and Zurich Representative for Conservatives Abroad.
The debate about housing affordability in Britain has a peculiar quality: it identifies the problem with precision and then reaches for solutions that do not match it.
Young people cannot get onto the housing ladder not because they lack character or discipline, but because the finance architecture for first-time ownership has broken down quietly, over three decades, without anyone deciding to fix it. In countries like Switzerland, New Zealand and Singapore, younger buyers have a practical tool that balances support with personal responsibility: the ability to draw on their own contributory pension savings to help fund a first home. In Britain, we have built the same savings mechanism. We simply do not allow people to use it.
The supply of housing is a real problem and must be addressed.
It will require planning reform and increased density in the urban areas where infrastructure, employment and transport already exist. Those arguments must be won. But supply reform alone, even if delivered at pace, does not solve the problem facing a 30-year-old today who has saved diligently, earns a decent wage, and cannot assemble a deposit large enough to access the mortgage market. That person does not need a discounted house. They need access to the finance that ownership requires. In 1997, the median house price in England was 3.6 times the median wage. Today it is 7.7. Home ownership among 25 to 34-year-olds has dropped from nearly 60 per cent to around 40 per cent in a single generation. The consequences are no longer abstract: people are delaying families, feeling estranged from a society that promised them a stake and delivered them a rental contract, and growing disillusioned with mainstream politics as a result. This is a constituency that conservatism should be speaking to directly.
In countries such as Switzerland, New Zealand and Singapore, pension systems are explicitly designed to accommodate home ownership. In Switzerland, workers may draw on their compulsory occupational pension to fund a deposit or reduce a mortgage, with the option to repay the amount and restore their retirement savings. In New Zealand, KiwiSaver members who have contributed for at least three years can withdraw virtually their entire balance, their own contributions, their employer’s match, and government contributions, toward a first home, with mandatory contributions resuming from the day of purchase. In Singapore, the Central Provident Fund has explicitly incorporated housing as a permitted use since 1968; members use their Ordinary Account savings to fund purchases and service mortgages, with accrued interest returned to the retirement pot upon any future sale. In each case, pension savings and home ownership are treated not as competing priorities but as complementary pillars of long-term financial security. It’s a logic Britain has never applied.
In Britain, the mechanism is already in place. Since 2012, auto-enrolment has quietly built a savings culture that previous generations never had. Millions of young workers are accumulating pension pots that they are legally prohibited from using for the most important financial decision of their lives. The reform required is not a new spending commitment, a new subsidy or a new product. It is a change to the law: allow accumulated auto-enrolment pension savings to be used as a first home deposit.
There are three reasons why this is a straightforward policy to pursue.
First, it costs the Treasury nothing as the money already exists in the saver’s own pot. Auto-enrolment contributions stay at current minimums, employer costs do not change, and no new public subsidy enters the market. Second, it creates no market distortion of the kind that discount schemes produce. Pension deposits are savings accumulated gradually over years; they do not arrive as a demand shock. Third, it requires no new product and no new application process. It is a single legislative change that people can understand immediately.
Critics may object, on paternalistic grounds, that allowing withdrawals risks undermining retirement security. It is true that money used for a housing deposit forgoes compound growth in later life, and that should not be dismissed. But Standard Life, drawing on Office for National Statistics rental data, estimates that someone who rents throughout retirement requires around £400,000 more in pension savings than a mortgage-free homeowner simply to maintain the same standard of living. A deposit withdrawal is not the destruction of a retirement asset, it is the conversion of one form of long-term security into another. The pension pot becomes a property; the property, in time, becomes a mortgage-free home. Every country that has implemented this reform has done so with deliberate guardrails. In New Zealand, the option can only be used once, and the property must be a principal residence. In Switzerland, withdrawals are limited to once every five years; after age 50, the amount that can be withdrawn is capped to protect later-career savings; and if the property is ever sold, the withdrawn sum must be repaid to the pension fund in full. Britain could adopt any or all of these protections. The real retirement risk is not using a pension deposit. It is remaining a renter for life.
Even with conservative assumptions, a worker starting on £27,000 at 22 with modest wage growth, minimum contributions only, no investment growth and the pot reaches around £17,000 by 30 and nearly £29,000 by 35: enough for a 5 per cent deposit on an average English property outside London, built entirely from their own contributions and their employer’s match. At a 4 per cent annual return, still below the long-run average for a default workplace fund, those figures rise to around £20,000 by 30 and nearly £37,000 by 35, comfortably clearing a 10 per cent deposit in Manchester and within reach of one in Bristol. For a future HENRY, high earner not rich yet, starting on £30,000 at 22 and rising to £75,000 by 35, the numbers are larger: roughly £26,000 by 30 and £44,000 by 35 with no growth at all; at 4 per cent, approximately £30,000 and £56,000 respectively. This is not theoretical wealth. It is locked-up capital that could turn a renter into an owner.
Britain has already built the savings system. It has already enacted auto-enrolment. It has already created the pot. All that is required now is the political will to unlock the door.
Thomas Griffin is Global Ambassador for the Conservative Policy Forum and Zurich Representative for Conservatives Abroad.
The debate about housing affordability in Britain has a peculiar quality: it identifies the problem with precision and then reaches for solutions that do not match it.
Young people cannot get onto the housing ladder not because they lack character or discipline, but because the finance architecture for first-time ownership has broken down quietly, over three decades, without anyone deciding to fix it. In countries like Switzerland, New Zealand and Singapore, younger buyers have a practical tool that balances support with personal responsibility: the ability to draw on their own contributory pension savings to help fund a first home. In Britain, we have built the same savings mechanism. We simply do not allow people to use it.
The supply of housing is a real problem and must be addressed.
It will require planning reform and increased density in the urban areas where infrastructure, employment and transport already exist. Those arguments must be won. But supply reform alone, even if delivered at pace, does not solve the problem facing a 30-year-old today who has saved diligently, earns a decent wage, and cannot assemble a deposit large enough to access the mortgage market. That person does not need a discounted house. They need access to the finance that ownership requires. In 1997, the median house price in England was 3.6 times the median wage. Today it is 7.7. Home ownership among 25 to 34-year-olds has dropped from nearly 60 per cent to around 40 per cent in a single generation. The consequences are no longer abstract: people are delaying families, feeling estranged from a society that promised them a stake and delivered them a rental contract, and growing disillusioned with mainstream politics as a result. This is a constituency that conservatism should be speaking to directly.
In countries such as Switzerland, New Zealand and Singapore, pension systems are explicitly designed to accommodate home ownership. In Switzerland, workers may draw on their compulsory occupational pension to fund a deposit or reduce a mortgage, with the option to repay the amount and restore their retirement savings. In New Zealand, KiwiSaver members who have contributed for at least three years can withdraw virtually their entire balance, their own contributions, their employer’s match, and government contributions, toward a first home, with mandatory contributions resuming from the day of purchase. In Singapore, the Central Provident Fund has explicitly incorporated housing as a permitted use since 1968; members use their Ordinary Account savings to fund purchases and service mortgages, with accrued interest returned to the retirement pot upon any future sale. In each case, pension savings and home ownership are treated not as competing priorities but as complementary pillars of long-term financial security. It’s a logic Britain has never applied.
In Britain, the mechanism is already in place. Since 2012, auto-enrolment has quietly built a savings culture that previous generations never had. Millions of young workers are accumulating pension pots that they are legally prohibited from using for the most important financial decision of their lives. The reform required is not a new spending commitment, a new subsidy or a new product. It is a change to the law: allow accumulated auto-enrolment pension savings to be used as a first home deposit.
There are three reasons why this is a straightforward policy to pursue.
First, it costs the Treasury nothing as the money already exists in the saver’s own pot. Auto-enrolment contributions stay at current minimums, employer costs do not change, and no new public subsidy enters the market. Second, it creates no market distortion of the kind that discount schemes produce. Pension deposits are savings accumulated gradually over years; they do not arrive as a demand shock. Third, it requires no new product and no new application process. It is a single legislative change that people can understand immediately.
Critics may object, on paternalistic grounds, that allowing withdrawals risks undermining retirement security. It is true that money used for a housing deposit forgoes compound growth in later life, and that should not be dismissed. But Standard Life, drawing on Office for National Statistics rental data, estimates that someone who rents throughout retirement requires around £400,000 more in pension savings than a mortgage-free homeowner simply to maintain the same standard of living. A deposit withdrawal is not the destruction of a retirement asset, it is the conversion of one form of long-term security into another. The pension pot becomes a property; the property, in time, becomes a mortgage-free home. Every country that has implemented this reform has done so with deliberate guardrails. In New Zealand, the option can only be used once, and the property must be a principal residence. In Switzerland, withdrawals are limited to once every five years; after age 50, the amount that can be withdrawn is capped to protect later-career savings; and if the property is ever sold, the withdrawn sum must be repaid to the pension fund in full. Britain could adopt any or all of these protections. The real retirement risk is not using a pension deposit. It is remaining a renter for life.
Even with conservative assumptions, a worker starting on £27,000 at 22 with modest wage growth, minimum contributions only, no investment growth and the pot reaches around £17,000 by 30 and nearly £29,000 by 35: enough for a 5 per cent deposit on an average English property outside London, built entirely from their own contributions and their employer’s match. At a 4 per cent annual return, still below the long-run average for a default workplace fund, those figures rise to around £20,000 by 30 and nearly £37,000 by 35, comfortably clearing a 10 per cent deposit in Manchester and within reach of one in Bristol. For a future HENRY, high earner not rich yet, starting on £30,000 at 22 and rising to £75,000 by 35, the numbers are larger: roughly £26,000 by 30 and £44,000 by 35 with no growth at all; at 4 per cent, approximately £30,000 and £56,000 respectively. This is not theoretical wealth. It is locked-up capital that could turn a renter into an owner.
Britain has already built the savings system. It has already enacted auto-enrolment. It has already created the pot. All that is required now is the political will to unlock the door.