Australia is facing a civilisational moment on the eve of the next federal election. The reason is simple: we are not having enough children, and yet neither major party seems willing to confront this reality.

As Australia’s fertility rate falls to a new record low, not a single policy has been brought forward to address it, while new housing policies from the Liberals and Labor are unlikely to help – pushing up housing prices even further for young people wanting to start a family.

Fertility rates – the average number of births per woman – have plummeted since the 1960s. No attempt, other than the Howard government Baby Bonus, to stall or reverse this trend has succeeded.

The recent Federal Budget revealed the fertility rate has dropped significantly in recent years – from 1.6 births per woman under the former Coalition government to just 1.4 this financial year, well below the replacement rate of 2.1.

Once the fertility rate drops below the replacement rate, a nation’s situation can quickly deteriorate. An average of 1.6 births per woman will result in cohorts halving every three generations; 1.4 births per woman will result in cohorts halving every two generations. This would leave Australia with the devastating problem of a shrinking workforce funding the healthcare and pensions of an ageing population. If there are more people entering retirement than the workforce, the financial burden on younger people increases and the quality of life falls for everyone.

Japan is currently in this position, with a fertility rate of 1.26 and the population now dropping by almost a million people each year. The country faces the crucial question of whether it’s too late to reverse the decline. Japan must decide how to address the rapidly shrinking child-bearing population, given its refusal to rely on migration to fix the problem.

Migration is the band-aid fix that most Western countries have turned to. In Australia, to compensate for the declining birth rate and hide a fall in productivity, migration has been ramped up by successive Coalition and Labor governments, particularly the Albanese government.

In February 2025, net permanent and long-term arrivals to Australia reached a record high of 111,740 – an average of 3,991 per day, or roughly three arrivals every minute. More than one million migrants have entered the country since the Albanese government was elected in 2022.

This has produced a range of downstream effects that have worsened the very conditions which deter young people from starting families in the first place. The cost of living has soared, and infrastructure such as schools, hospitals and transport systems have been pushed to their limits.

Studies show housing prices are the primary issue for young people and a key barrier to starting a family. As migration has risen, the construction of new homes has not kept up. Under the Albanese government, building approvals have fallen to their lowest level in over a decade, and the construction of new homes is 36,000 behind its National Housing Accord target.

Far from helping the situation, the housing policies announced by the major parties ahead of May’s federal election are set to make the situation worse.

The Coalition’s housing pitch for first-home buyers would allow eligible individuals to deduct the interest paid on up to $650,000 of their mortgage, with no cap on home prices. As noted by The Australian’s Editor-at-Large, Paul Kelly, ‘It will fuel demand, boost house prices, distort the income tax system and is highly regressive, with benefits to the better-off.’

Meanwhile, Labor has pledged $10 billion to build 100,000 homes over eight years exclusively for first-home buyers, and a scheme allowing first-home buyers to purchase a home with a 5 per cent deposit. Labor’s track record to date does not give Australians any reason to believe this will ever be delivered, and experts say this policy will also push up house prices.

Earlier this month, Elon Musk drew a parallel between population decline in the 21st Century and ancient Rome in a post on X. ‘Low birth rates were a big deal for the Romans as early as ~50BC, for example. They debated endlessly about how to solve the problem and they failed,’ he said.

Musk’s post highlights the significance of this issue (not to mention his single-handed efforts to raise the birthrate) as it is one that has contributed to the downfall of civilisations throughout history.

However, unlike the Romans, our own politicians have their heads in the sand and are refusing to even discuss possible policy solutions.

There are meaningful changes governments can make to address financial barriers to starting a family. Reducing migration levels, boosting housing supply, and putting in place an economic framework which gives families a choice to have a parent stay at home would be a good first step.

But as the election campaign rolls on, it begs the question: have our major parties given up on Australians having children? By refusing to address the root causes of population decline, our political class has abandoned the future in favour of short-term fixes.

Brianna McKee is a Research Fellow at the Institute of Public Affairs