Posted by prawn 4/4/2025
Partly this is because of the myopic policies of the coalition and then conservative governments, which didn't invest in growth and what seems like a blindingly obvious consequence of this is that there was then no growth.
> Britain’s houses are cramped, ancient and in the wrong places
Ain't that the truth. And actually you're better off getting the ancient ones because they're less cramped.
I think I agree quite a lot with this article, as someone now watching from overseas - something needs to be done as the state just seems to soak up ever more money for ever less benefit to the average person. Things are getting worse and more expensive over there. Time to change tack and at least have them get better if it's going to cost more!
This is true of Europe in general vs the US because economic growth in Europe has been low compared to the US since at least the financial crisis. At the time GDP of the Eurozone was comparable to the US' now the US is almost twice as big. As a consequence every European country ranks low compared to US states on GDP per capita:
"Italy is just ahead of Mississippi, the poorest of the 50 states, while France is between Idaho and Arkansas, respectively 48th and 49th. Germany doesn't save face: It lies between Oklahoma and Maine (38th and 39th)." (2023) [1]
[1] https://www.lemonde.fr/en/opinion/article/2023/09/04/the-gdp...
No, You're just comparing change in the EUR/USD exchange rate here. In 2007, the euro was at a high point of 1.48, and in 2024 it's at a low of 1.02. Inflation has not been higher in Europe than in the USA over that period.
If we look at GDP at purchasing power parity from 2007 to 2023 we have this:
- European Union: 31,162 → 61,217, +96% (https://data.worldbank.org/indicator/NY.GDP.PCAP.PP.CD?locat...)
- USA: 48,050 → 82,769, +72% (https://data.worldbank.org/indicator/NY.GDP.PCAP.PP.CD?locat...)
Which shows a slight catching-up by the European Union over the period.
"Between 2010 and 2023, the cumulative growth rate of GDP reached 34% in the United States, compared with just 21% in the European Union and 18% in the eurozone. This measure of GDP in volume does not depend on changes in exchange rates." [2]
[1] https://www.futuribles.com/en/sur-le-decrochage-economique-e... [2] https://www.polytechnique-insights.com/en/columns/economy/ec...
2. I'm glad that people in the UK have access to healthcare. I'd be very happy if that went to the US. That doesn't change the raw GDP figures though.
I agree it may change the experience they have of being poor if you aren't also deprived of medical care. But here's another thing - people in the UK are less satisfied than ever with the NHS as well - it appears to be floundering.
(In answer to the below "people have always been less satisfied with the NHS" - perhaps so, but this time it's serious, they haven't been this less satisfied before - https://www.theguardian.com/society/2025/apr/02/patient-sati... )
That's assuming they're relevant, and spoiler, they aren't for the topic at hand.
How is any individual's life better because they work at a café selling $20 coffee vs £5 coffee? Because if you measure GDP, person one is drastically more productive, but in reality, it doesn't matter, really. If both are earning minimum wage, the person in the UK with the cheaper coffee has higher income (outside of a few US states). But what is their quality of life? That's highly dependent on where they live, what are their housing costs (which are quite high in the UK in most desirable locations), etc. In any case, GDP doesn't evaluate that, and it's probably the main thing people care about and what they mean by "poor".
I agree, GDP is an incomplete measure, but it does provide a comparison point.
Environmental impact assessments, engineer stamps, etc, etc, for minor projects that wind up prescribing some petty stormwater solution which adds up to more cost than if the Taj Mahal of stormwater solutions had just been fired from the hip in the general direction of the problem. Graft reducing procurement processes that have grown over time to cost more to run on an annualized basis than the graft they were intended to prevent.
At least if we took best guesses when implementing solutions to ancillary problems and awarded contracts based on favor trading at least we'd have the solutions and the stuff to show for it even if the solutions and stuff aren't perfect.
Similar argument to the article, but in much more depth.
In a nutshell, the UK has made it legally difficult to construct new housing and many forms of infrastructure- electricity plants, roads/tunnels, railway, hospitals, etc.
As a result, these things take up a larger fraction of ordinary people's budget and also limit mobility and hence productivity, resulting in poverty or effective poverty even for someone with an income that would make them globally rich.
https://www.theguardian.com/commentisfree/2024/oct/20/britai...
"For those born in the 1940s and 1950s, incomes would typically double from their late 20s to their early 50s. However, those born in the 1960s only saw income grow by around 50% over that period, whilst those born more recently look set to see weaker growth still as they age."
https://ifs.org.uk/articles/income-and-wealth-inequality-exp...
* Naval and trade dominance (a legacy of Venetian methods, transferred through the Netherlands).
* Financial systems (London as the hub of insurance, lending, and later offshore banking).
* Intelligence networks and manipulation (from the East India Company to MI6).
* Colonial exploitation (enclosures, the Opium Wars, the Bengal famine of 1943, suppression of the Sepoy Rebellion, the exploitation of Ireland, etc.).
* Enclosures (16th–18th centuries) – Peasants driven off the land for landlord profits.
* The Irish Famine (1845–1849) – Grain was exported to England while millions starved.
* "Divide and rule" policies – From India to Northern Ireland, preventing unity among the oppressed.
* Austerity – Post-2008 budget cuts
- UK poverty has been falling continually for decades
- UK real disposable household income (median) after housing costs is higher than ever
(the latest report came out a few days ago and actually the latest year is a slight worsening of household income, but not far off the high from 2022)
The numbers do paint a picture of a fairly anemic 5-10% increase between 02/03 and 23/24 in 'inflation-adjusted' median household income.
However, I note that that the data is 'equivalised' which to me somewhat muddies the waters; the numbers are inherently tied into the population's demographics, and I'm not confident that I understand what effect things like demographic shifts (which are obviously ongoing) would have on these numbers.
It’s still a travesty that the UK has not gotten much richer in the last 20 years than it has, but the constant refrain of “living standards are collapsing” and “no one can afford a house” just doesn’t match the data IMO.
I think it muddies the waters because it's possible that the numbers are higher because people are choosing to have fewer children (which may be driven by affordability), or more people are living in HMOs. It makes it much harder to argue about cause and effect. Are these equivalised incomes rising because people are having fewer children, because there are more people living in HMOs - or are more people doing these things because of a crisis of affordability?
> but the constant refrain of “living standards are collapsing” and “no one can afford a house” just doesn’t match the data IMO.
https://www.ons.gov.uk/peoplepopulationandcommunity/housing/...
The price of housing in England has doubled relative to the median income since 2000.
House price ratio has doubled since 2000 but over the last twenty years in the UK it’s flat. The doomsaying is not justified.
Now come on, data is data, if you want your arguments to live on the cite-able data, then you must accept that your arguments can also die on the cite-able data.
Take a look at a longer term view of the data and tell me you wouldn't be angry: https://www.schroders.com/en-gb/uk/individual/insights/what-...
And remember that this says nothing about the quality of housing, or its suitability for the needs of the household.
The housing crisis is not primarily one of homelessness (although many are forced to live in poor quality temporary accommodation waiting decades on lists for affordable housing), but of people living in the wrong accommodation for their needs; some of them forced to live in dangerous accommodation but unable to move, a greater number forced to rent, some people being forced to live with their parents; these are the things that happen when affordability decreases.
Do me a favour and do some real research on the topic before you dismiss other people's problems as nonsense. I think you owe them that.
It is of course a lot higher than the 1950 - 2000 period, but I think two things explain this.
1. Women started having careers eventually doubled the borrowing power of the typical household
2. The housing is much higher quality (50s lodgings may not even have had indoor toilets; central heating wasn’t common until the 70s/80s)
So I think we’re essentially at a natural plateau of the house/earnings ratio, subject to volatility from outside factors. You could argue that housing has been unaffordable since the early 2000s, but the (false) narrative that’s usually pushed is of ever worsening conditions.
Nobody believes that about the bat tunnel. HS2 designed the most expensive thing they could think of because that maximises the profit. They say Natural England approved it but why wouldn't they? In a non-government project the contractors would negotiate with Natural England to agree on the cheapest thing that complied with the law. HS2 presented the most expensive thing and said can we do this? And they got the answer they wanted.
The longer it takes the more the companies involved in making it receive, because the government will cover the bill.
Everybody is lazy, nothing works, and nobody is going to do anything about it because doing something would require fighting an army of bureaucrats. And, dear reader, who would blame you for not doing that?
I had British Telecom around to fix a wiring issue. The rental agency said they'd be coming by on Thursday or Friday and I should pick. Simultaneously, I get a text from BT that they'll be by on Wednesday. The gent shows up Tuesday. I ALSO get a call on Friday (while I'm at work): "Mate, I'm about 15 minutes away from your house...".
Everything is like this. Everything.
data for 2024
https://ichef.bbci.co.uk/news/1536/cpsprodpb/7EF2/production...
I made my peace with not earning London salaries but being able to comfortably live in a nice area and pay off my mortgage early a long time ago.
My parents weren't of the University generation, so I'm ~better off than they were at the same point in our lives. On the other hand, we're worse off than my in-laws would have been at the same time, because of housing. But housing is a fixable problem. The government just needs to legislate to allow the building of more of it. Even in London, the real answer, whether politicians want to say it or not, is the densification of suburbs - allow redevelopment of suburban areas into higher density developments, and prices will come down.
Same with public sector - we had an ecosystem of small businesses delivering services and that was destroyed. Any public sector body buying these services got fined and "nudged" to buy from more expensive big corporations.
So you get no productivity, brain drain and big corporations taking massive profits overseas, where small business would spent the money locally stimulating the economy.
It's a slow car crash, nobody is paying attention to.
I agree the implementation of IR35 is an absolute, grade-A clusterfuck, and leaves workers having to do things like buy IR35 insurance, and make in/out determinations themselves, only for HMRC to come up with new ways to try and classify them as 'managed service companies', or a myriad other ways to undermine the entire sector, such that financial ruin can be dangled over people's heads like the sword of damocles...
But working class? Pull the other one!
In reality, IR35 has had a broad and damaging impact on a much wider group of skilled workers - IT contractors, engineers, healthcare professionals, tradespeople - many of whom built small, legitimate limited companies as a way to work flexibly, compete fairly, and build some financial security. It was one of the few viable paths to independence left, and IR35 has made it effectively unworkable for many.
Large corporations didn't like losing contracts and talent to smaller, more agile competitors. IR35 conveniently removed that competition by making small operators too much of a compliance risk to hire. Meanwhile, public sector bodies were discouraged—sometimes even penalised—for engaging small suppliers, further consolidating the power of the big consultancies.
The media focus on celebrity cases wasn't accidental. HMRC gained free publicity and public support by targeting high-profile individuals - knowing it would reinforce the idea that IR35 was closing tax loopholes rather than quietly dismantling a thriving small business ecosystem. The result is a workforce with less autonomy, less incentive to go above and beyond, and fewer opportunities to build something for themselves.
This isn't just about tax - it's about economic structure, incentives, and who gets to participate in the rewards of their own labour. And when those opportunities disappear, so does productivity, innovation, and local economic resilience.
You're not disagreeing with me, other than that I don't consider those "working class" occupations. In general in the UK those are quite often middle to upper middle class.
> tradespeople
Still do run small limited companies AFAICT. Certainly the ones I used to interact with. Mostly because they have multiple clients and are a lot harder to point at and say "that's not a real business!"
IT has been one of the only modern trades where working-class people could genuinely break through - without inherited privilege, connections, or expensive qualifications. All it took was a computer, determination, and skill. For decades, it offered an alternative route to upward mobility that wasn't gatekept by traditional class boundaries.
To say those people aren't "working class" anymore simply because they found success in a high-paid field is to misunderstand how class mobility works - and to dismiss the significance of what's been lost. IR35 didn't just hit a few middle-class professionals - it cut off a rare path to independence that was uniquely accessible to people from working-class backgrounds.
That's what makes it so damaging. It's not just about tax or regulation - it's about who's allowed to build something for themselves, and who gets pushed back into being a compliant employee for a large organisation.
> Still do run small limited companies AFAICT
You're absolutely right—tradespeople doing B2C work are largely unaffected, because IR35 targets B2B relationships, especially when the client is a medium or large company. But that actually reinforces the concern: it's access to the broader market - especially corporate and public sector clients - that’s been cut off.
For working-class professionals who moved into areas like IT, healthcare, or consulting, IR35 has closed the door to operating as a small business in those spaces. They can still work - but now only as employees or through intermediaries, with fewer rights and no control. They’re denied the same freedom tradespeople still have in B2C, despite offering equally legitimate, client-driven services.
So yes, plumbers and electricians can run limited companies - but if someone from a similar background wanted to build a small IT consultancy or contract directly with the NHS, that’s now a legal minefield. The playing field isn’t level - it’s skewed in favour of large firms, and that restriction disproportionately hurts those without generational wealth or corporate safety nets.
It’s clear we’re talking past each other. I disagree that IR35 has had a specific effect on social mobility, but am happy to leave the conversation here!
If someone is a professional, they are engaged in a middle class job on a middle class income. Unless you consider “working class” to be something that is indelibly stamped on someone’s soul at birth…
Being a professional or in management is pretty much the definition of middle class - https://en.m.wikipedia.org/wiki/Social_class_in_the_United_K...
This is what I mean by talking past each other - I don’t think we’re working from the same dictionary.
Many working-class people entered fields like IT, engineering, or contracting not because they were "born middle class", but because those were accessible paths that didn't require elite credentials, family connections, or private education. They built businesses, gained skills, and carved out independence - often still without the security, assets, or cultural capital traditionally associated with the middle class.
By your definition, the moment they succeed, they're no longer working class - which conveniently absolves the system of any responsibility for making life harder for them. It's circular: "If you’re struggling, you're working class. If you succeed, you were never working class." That's what's classist—defining people's identity by a fixed socioeconomic role and then erasing their background the moment they transcend it.
Social class isn't just about job title - it's about access to capital, power, mobility, and resilience in the face of economic shocks. IR35 disproportionately affected people who were just starting to get a foothold in those areas - often without the safety net others take for granted.
And yes, we may be using different definitions - but mine accounts for lived experience and systemic barriers, not just an abstract Wikipedia definition from a table written decades ago.
That's not what I've been saying at all, and IMHO that's pretty disingenuous. It doesn't absolve anyone of anything, it's a definition.
You do you though I guess.
My point is: when you define class that narrowly, it becomes easy to dismiss systemic barriers people face once they gain a bit of success. It makes it seem like they've escaped and no longer face structural disadvantages, which just isn't true for many. Especially when policies like IR35 are designed to push them out of ownership and back into dependency.
Upper-middle class is mostly bankers, barristers, surgeons, some politicans and so forth.
While permanent IT staff are often regarded as generic office workers, usually in poorly performing small to medium enterprises in backwaters around the country, in London and in Finance this is not really the case.
Consultant IT people can make out like bandits, IR35 or no, and even those perm people in the backwaters are middle class in earning and habits. It’s absolutely not a working class occupation.
Incidentally this attitude from middle management in (mostly) non-London SMEs is a big part of why they are doomed to fail - they value middle-management above skilled workers and end up in a doom spiral of low pay, low productivity and low expectations. If you’re in one of those situations - get out, opportunity is out there. But you won’t find it in a shabby office at the back-end of an industrial estate in Basingstoke.
Many skilled workers set up limited companies not to "make out like bandits" but to gain a small degree of control in a system that otherwise offers very little. IR35 took that away, not from boardrooms or multinational firms, but from individuals trying to carve out their own space. It wasn't just a policy shift—it was a signal: you're not allowed to operate outside the machine.
This has little to do with London versus the rest. It's about how the economy is increasingly structured to funnel all meaningful work through large gatekeepers, whether private or public. The destruction of small-scale service businesses - especially in the public sector - didn't just hurt livelihoods. It erased entire layers of local innovation, independence, and pride in craft.
The result is exactly what we see now: a drained workforce with no stake in the outcome, no reason to go above and beyond, and no path to build something of their own. That's not a London problem or a Basingstoke problem. That's a systemic one.
It certainly needs reform, but it hasn’t killed the contracting sector. Far from it. It’s still massively lucrative.
Yes, the public sector restrictions a few years ago changed some things, but from friends in the public sector AFAICT what it changed was that it cut down on a culture of people who were for all intents and purposes employees, who had often been in positions of managerial responsibility in councils and other bodies for years, pretending they were independent businesses and avoiding tax while (comparatively) charging the earth.
However you want to paint it class -wise, when someone is acting as an officer in a company or council for half a decade, they’re not an independent creative struggling to have some control, they’re working a job like any other schmuck.
Honestly, I think the UK tax laws need to be reformed so that it doesn’t matter for income - you make money in a company structure as a contractor, or make it as an employee, tax is the same. Dividend or income, tax is the same. It would sort the unholy mess out and take away the incentives to use contracting as a tax dodge and for HMRC to retroactively fuck up someone’s life.
It’s how it works here in Australia. No IR35 required, for the most part income is income is income and it all counts towards your taxable total. Then you work how it best suits you.
Here's the reality: a one-person limited company providing services to a council for several years is treated as "dodgy" or "cheating the tax system." But if a big consultancy sends in a contractor to sit at the same desk for the same duration, it's completely exempt from IR35 scrutiny. The only difference? Ownership. The first is worker-owned, the second is not.
IR35 doesn't prevent "disguised employment." It just channels it through structures that protect and enrich corporate intermediaries. And those same intermediaries are often billing 2–3x the rate a direct contractor would charge—while extracting value from someone else's labour, then exporting the profits.
You also dismiss repeat clients as a sign of disguised employment - but by that logic, any successful small business with loyal customers should be disqualified from existing. Long-term client relationships are the goal of any serious enterprise. It's only when those relationships threaten the margins of large incumbents that they suddenly become suspect.
IR35 wasn't about fairness or tax efficiency. It was about reclaiming market share - removing small, independent operators who were too competitive, too flexible, and too accountable to clients, and replacing them with firms who could play the compliance game and charge more for less.
So no—IR35 didn’t just "clean up abuse." It entrenched it. It created a two-tier system where actual independence is punished, and corporate dependency is rewarded. That's not reform - that's capture.
Devil's advocate as I, too, dislike how it was basically lobbied by big corps but really it seems unsustainable for high tax Euro countries to allow their people too much working freedoms?
The idea that "too much working freedom" is unsustainable in high-tax countries reflects a deeply top-down, corporatist mindset. It assumes that ordinary people being in control of how they work is somehow a problem to be fixed - especially if they start competing with entrenched players.
In reality, IR35 wasn't about tax fairness. It was a response to small businesses becoming too competitive - delivering the same services as large consultancies, but with more agility and less overhead. The legislation didn't level the playing field - it tilted it to protect big corporations from small rivals, using misleading narratives to justify it.
Other countries may have similar pressures, but few have responded by attacking independent economic agency as directly as the UK has.
Because IR35 is not the major issue facing the UK that you seem to think it is...
