Population decline and smaller families good news for climate, says former head of FSA

World is on a ‘path to disaster’ if radical changes aren’t made, report argues

Older workers would be encouraged to delay their retirement with cash incentives (Getty Images/iStockphoto)

Population decline should “not be feared” because it will help the UK reach its climate goals, the former chief of the finance regulator has said.

Lord Adair Turner, former chairman of the Financial Services Authority, said that a gentle decline in birth rates would “deliver significant benefits to human welfare”.

Writing in a research paper, he argued that with the right government policy an ageing population would not pose a threat to the economy.

Low birth rates and an ageing population have often been seen as a looming crisis, with economists arguing there will not be enough people to work and contribute to the future economy.

This, coupled with the rising cost of pensions and health care, has made people increasingly worried about shrinking populations and smaller families.

But the report, Smaller Families and Ageing Populations, argued this is good news.

It said the UK could cut C02 emissions by some 38m tonnes - the equivalent of taking 19m cars of UK roads - by 2035 if its population was to reduce at the same rate as that of Japan.

In Japan, women give birth to an average of 1.36 children, down from 2.1 in 1974. In England and Wales the figure is 1.6.

By 2035, the Japanese population is set to decrease by 9.6 per cent from 125m to 113.1m people. By contrast, the UK is predicted to increase by by 5.2 per cent over the same period, to 71.1m people.

The report also said that a declining population would eliminate the need for some 4m extra homes across Britain and could stop housing developments on some 435,000 acres of land.

In his foreword to the report, Lord Turner, said: “The biggest reason to welcome this demographic shift is that it results from the free choice of empowered people, and in particular women.

“But ceasing endless population growth will also reduce humanity’s future press on the natural environment, ease the challenge of adequate housing provision, and make it easier to achieve net zero greenhouse gas emissions while supporting prosperity growth in developing countries.”

Robin Maynard, director of charity Population Matters, criticised Elon Musk’s previous comments that “population collapse is potentially the greatest risk to the future civilization”.

He said: “Women’s bodies are not an economic tool to provide a growing supply of cheap labour and new consumers to the very wealthy.

“An economy which ignores the environmental limits of our planet can’t deliver long- term wellbeing.”

The report did acknowledge that labour shortages would become an increasing problem with an ageing population. But it argued automation in the work force and migration would be key to dealing with this issue.

It also called for delayed retirement and incentives, such as an increase in their personal tax-free allowance, to keep people working.