I dunno, the agglomeration/network effects could easily enough make up for that, and people can leave London once it's obvious they're not going to make it, having built up their human capital faster than they could have anywhere else, and being able to command London salaries on provincial living costs.

It hurts the South-East because it puts the infrastructure under enormous strain and property prices beyond the reach of mere mortals, while draining the rest of the UK of its talented young.

If they wanted to make housing affordable, whether rented or to own they could get rid of the green belt, or encourage much denser housing. The infrastructure problems could be solved by application of sufficient money and compulsory purchase, though one would need to massively streamline the current procedures on that, and on planning. If China can build subways with stations that open in fields, so could London.

As to the talented young, they speak English, if they weren't going to London it's very likely they'd be going to the States.

This is one thing I think the Germans do right - a much more culturally, economically and politically balanced nation

Never a matter of policy. Germany was the belated nation and it's multiple centres are a consequence of late unification and being split in half and made more federal in power structure by the conquerors. (I exaggerate the German lack of agency in the choice of West German state structure)