A Scottish National Investment Bank: the solution to growing Scotland’s economy?

By Steven McGinty

On 28 February, the Scottish Government’s ambition to establish a Scottish National Investment Bank (SNIB) moved one step closer, following the publication of an implementation plan.

Welcoming the plan, First Minister Nicola Sturgeon (who announced the policy last September) set out why she believed the time was right for a Scottish National investment bank. She explained:

“To realise our ambitions for Scotland’s economy, innovative companies need access to strategic, patient finance to grow and thrive, while the business environment must encourage our young people to be the entrepreneurs of the future.”

What does the plan say?

The plan – developed by Benny Higgins, CEO of Tesco Bank – provides recommendations for the governance, operating model, and financing of the new bank. It proposes that the new financial institution should:

  • be publicly-owned and focused on creating inclusive growth
  • operate in an ethical and transparent way
  • be supported by £2 billion of capital over the first 10 years
  • work with private investors, not crowd them out
  • help creative new markets for private investment
  • provide investment for smaller and larger projects
  • become self-sufficient in the long-term, including raising its own capital to fund investments

Why a publicly owned bank?

The idea has circulated in British politics for a number of years, particularly since the 2008 financial crisis. In 2010, Lord Mandelson – then Secretary of State – seemed keen on the idea, even going so far as having fact finding lunches with representatives from the KfW banking group, Germany’s state-owned bank. In 2017, the UK Labour party manifesto included a proposal to establish a National Investment Bank and a network of regional development banks.

In Scotland, environmental campaigners Friends of the Earth have been working with New Economics Foundation and Common Weal to build a case for a national investment bank. In their 2016 report ‘Banking for the Common Good’, the group argued that the UK banking system is not fit for purpose, highlighting that over two million people in the UK don’t have a bank account and that 1,500 communities have no access to banking services. They also noted that small businesses struggled to access finance, particularly in Scotland.

The plan has also been influenced by the work of University College London professor Marian Mazzucato – a member of the Scottish Government’s council of economic advisers. At the launch, she explained:

Innovation requires patient strategic finance, and there is simply not much of that in the UK. Yet around the world state investment banks are taking centre stage in providing such finance for key social and environmental challenges of the 21st century.”

The International Monetary Fund (IMF) have also published research on the rationale for publicly owned banks. This includes work by Nobel Prize winning Economist Joseph Stiglitz, who suggests state banks can help overcome market failures by promoting investments which lead to important social benefits. In addition, the report notes that state banks have the ability to invest resources in strategically important areas which the private sector has been unwilling to invest in. Providing this capital can be crucial for developing innovative technologies, helping them to emerge as profitable industries, and eventually creating economic growth.

Opposition to a Scottish National Investment Bank

In the Scottish Parliament, Ruth Davidson, leader of the Scottish Conservative Party, claimed that the bank was just a re-announcement of previous policies, highlighting that there is already a Scottish Investment Bank, which sits within Scottish Enterprise.

However, this was robustly refuted by the First Minister, who argued that the new Scottish National Investment Bank was on a different scale and of a different nature to previous programmes.

National investment banks in practice

Germany – Kreditanstalt für Wiederaufbau (KfW)

The KfW is owned jointly by the German government (80%) and German states (20%). The bank raises about €60-70 billion each year through issuing bonds and due to its’ public status is able to provide loans at better rates than commercial banks. It has interests in a wide range of areas, from funding small and medium sized enterprises looking to export abroad, to cities looking to invest in new road infrastructure.

The bank has won a number of awards including ‘World’s Safest Bank 2016’ and ‘Best Responsible Investor 2016’.

Nordic Investment Bank (NIB)

The NIB was formed in the mid-1970s by five Nordic countries: Denmark, Finland, Iceland, Norway and Sweden. By 2015 the bank had grown to include three new members: Estonia, Latvia and Lithuania.

Based in Helsinki, its mission is to create a ‘prosperous and competitive Nordic-Baltic region’. This is achieved through funding projects that improve infrastructure, increase market efficiency, and support the development of new technologies.

In 2016, €3,373 million was disbursed in loans, with the largest share of lending going to local governments to fund wastewater systems, electricity transmission, and heat generation projects.

Final thoughts

Since the 2008 financial collapse, a number of political leaders have supported a national investment bank. However, what really matters is that any new bank – whether public or shareholder owned – is able to meet key economic goals, including increasing finance for small and medium sized businesses and supporting the technologies of the future.


The Knowledge Exchange provides information services to local authorities, public agencies, research consultancies and commercial organisations across the UK. Follow us on Twitter to see what developments in policy and practice are interesting our research team. 

A digital identity crisis: is slow progress costing citizens and business?

A steel padlock on a brown wooden gate

By Steven McGinty

The government’s flagship digital identity programme, GOV.UK Verify, has not been short of problems lately. However, news that benefit claimants have been unable to register for the new Universal Credit (UC) because of problems using the service highlight that its failings are having real-world consequences.

In February, government statistics showed that only 30% of claimants were able to use GOV.UK Verify – well below the projected 80%. Further, research in the London Borough of Croydon found that even with one-to-one support only one in five people could prove their identity.

A history of problems

Problems were identified in the National Audit Office’s Digital transformation in government report in March 2017. The NAO found that the service, which was expected to simplify how citizens verified their identity to government agencies, had missed its initial launch date of 2012. Instead, only nine out of twelve services had been launched four years later in 2016.

Government departments who were expected to come on board have also thought twice. In December 2017, NHS England’s chief digital officer Juliet Bauer announced that they’d be developing their own digital identity system (although did suggest that GOV.UK Verify may be used for services which have less sensitive information). Similarly, HMRC announced last month that they will develop their own identity service – based on their 15-year-old Government Gateway Service – with rumours suggesting they have no confidence in the government’s solution.

With this backdrop, it’s unsurprising that Civil Service Chief Executive and Cabinet Office Permanent Secretary John Manzoni has brought in management consultancy McKinsey to conduct a review into how digital identity could work within the public sector.

Community Weekly’s Editor in chief, Bryan Glick, suggests this review could lead to a fundamental rethink and the introduction of ‘Verify Compliant’. He explains that:

Verify could become a brand name, rather than a product produced by GDS. That brand name will encapsulate a set of digital identity standards, for use across the public and private sectors. If you want to be part of the UK’s digital identity infrastructure, you need a product that is “Verify compliant”.

The impact of Brexit

David Bicknell, editor at Government Computing, suggests that Brexit preparations have pushed the transformation strategy – including GOV.UK Verify – off the agenda.

However, Government Digital Service (GDS) director general Kevin Cunnington has a different take on things. In his view, the GDS is continuing to deliver improved digital services, highlighting that GOV.UK Verify is available to local councils and is used by the Land Registry to support their new digital mortgage service.

Why the UK needs to tackle digital identity

People are increasingly using digital services to shop online, pay bills, and to interact with different levels of government. However, even though technology has dramatically changed, much of how people prove their identity is still paper based. For instance, paperless bank account holders still have to request paper documents to prove their address (possibly at an additional cost).

New industries such as the sharing economy, which includes the likes of Airbnb and Uber, rely on secure digital identity verification. Government has a responsibility to lead from the front and protect this ever-growing number of customers. For example, Airbnb customers across the world have experienced thefts from properties from criminals using false identification.

More generally, there has been a rise in identity fraud. According to fraud prevention charity Cifas, this now represents the majority of all fraud cases (approximately 56% in the first six months of 2017). An inability to verify identity is likely to have contributed to this increase.

In addition, many people are financially and socially excluded by a lack of photographic identification ID such as a passport or a driver’s license – particularly those from low income backgrounds or who have been in prison. This lack of ID can act as a barrier when applying for government benefits or financial services.

Gunnar Nordseth, CEO at digital identity provider Signicat, also argues that a failure to introduce a digital identity scheme could have serious consequences for the UK’s financial industry (especially the emerging fintech sector). He explains that GOV.UK Verify isn’t ‘fatally flawed’ but needs to be more ambitious, observing that:

Unlike other European digital ID schemes GOV.UK Verify is limited to the public sector, does not support financial services and is not interoperable with its continental counterparts.”

Final thoughts

Tackling the digital identity crisis won’t be easy. But recent statements acknowledging the challenges of GOV.UK Verify and the calling of a review suggest the Government Digital Service (GDS) are listening to concerns.

However, this time for reflection mustn’t last too long. Getting digital identity right has the potential to improve services for citizens, create efficiencies in government and business, and ensure the UK’s place as a world leader in the burgeoning digital economy.


The Knowledge Exchange provides information services to local authorities, public agencies, research consultancies and commercial organisations across the UK. Follow us on Twitter to see what developments in policy and practice are interesting our research team. 

If you found this article interesting, you may also like to read our other digital articles.

Disrupting cities: are tech firms to blame for rising inequalities?

By Steven McGinty

In cities across the world, there is growing unease at the impact of tech firms on local communities. In San Francisco’s Silicon Valley, “Google Buses” – the corporate commuter buses for Google staff – have been the subject of multiple protests by local activists, including the blockading of buses and displaying provocative banners.

The protesters’ main grievance? Housing. Researchers at the University of Berkley have found that rents close to bus stops used by Google employees are 20% higher than in other comparable areas.

It’s not just about Silicon Valley

In East London’s Tech City – home to both Google and Amazon – there have also been housing pressures, with property prices increasing by 13% in the two years to April 2017.

Further, The Economist has produced a map of London gentrification, showing that affluent young professionals are living in the inner-city, whilst poorer, often less educated ‘service workers’, are being pushed to the outskirts of the city. As Professor Richard Florida describes it “London is the archetypal example of a class-divided city”.

In Dublin, where Google and Facebook occupy 4% of all commercial office space, local activists have blamed tech firms for their housing crisis. Aisling Hedderman of the North Dublin Bay Housing Crisis Community, highlights that

“…we’re not going to see housing provided for families, but houses provided for single people and couples. And as long as people are willing to pay the high rents it’s going to keep driving up the rents

Tech firm Airbnb has also received a lot of attention for its impact on housing. Airbnb, who enable people to rent out their properties or spare rooms, has faced challenges in a number of cities. For instance, in November 2017, Vancouver introduced new regulations to stop businesses from offering short-term rentals through Airbnb and similar services. This means people can only rent out their principal property – which the city hopes will increase the availability of long-term rentals.

Technological change is nothing new

Edward Clarke, former analyst at the Centre for Cities, however, argues that the real problem for cities is not gentrification but poor city management.

In his view, urban neighbourhoods have always experienced periods of change, highlighting that Shoreditch’s status as a tech hub follows a long tradition of innovators moving to the area. And that research has shown that ‘new jobs’ (such as those in the digital and creative sectors) bring higher wages to an area, for the people working for these firms and in other sectors. Instead, Mr Clarke suggests there is a need to build more homes, and to consider developing on part of the Green Belt.

To alleviate these challenges, cities have started to recognise the need for closer collaboration. New York, Dublin, and London have all recruited tech leads to work with the tech sector. However, Joe Kilroy, policy officer at the Royal Town Planning Institute (RTPI), highlights that tech leads must have a remit that is wider than encouraging tech firms to move to the city. He explains:

Ideally the tech lead would liaise with city planners who can articulate the issues being faced by the city – such as housing affordability, infrastructure pressures, and skills shortages.”

Toronto and Kitchener, Ontario

In 2017, Toronto and its small town neighbour Kitchener announced plans to introduce a new transit line to ensure the city can cope with an expected influx of new tech workers.

It may be surprising to some that it’s not Toronto that’s the main tech player, but the region of Kitchener-Waterloo, home to the University of Waterloo and the birthplace of the Blackberry. It’s internationally recognised as a hub of innovation and prides itself on being different to Silicon Valley, viewing itself as more of a community than a series of business networks.

Local tech leaders acknowledge the importance of reaching out and working closely with local charities on issues such as affordable housing, as well as offering their skills to the community.

Final thoughts

Cities must ensure that the growth of the tech sector benefits everyone, and that sections of society aren’t left behind. However, big tech firms also have a role to play, and should become active participants in their communities, leading on areas such as education and skills and housing. Only then, will these tech firms truly prosper while having a lasting and positive impact on the surrounding communities.


The Knowledge Exchange provides information services to local authorities, public agencies, research consultancies and commercial organisations across the UK. Follow us on Twitter to see what developments in policy and practice are interesting our research team. 

How urban farmers are learning to grow food without soil or natural light

Mandy Zammit/Grow Up, Author Provided

This guest blog was written by Silvio Caputo, Senior Lecturer in the School of Architecture, University of Portsmouth.

Growing food in cities became popular in Europe and North America during and immediately after World War II. Urban farming provided citizens with food, at a time when resources were desperately scarce. In the decades that followed, parcels of land which had been given over to allotments and city farms were gradually taken up for urban development. But recently, there has been a renewed interest in urban farming – albeit for very different reasons than before.

As part of a recent research project investigating how urban farming is evolving across Europe, I found that in countries where growing food was embedded in the national culture, many people have started new food production projects. There was less uptake in countries such as Greece and Slovenia, where there was no tradition of urban farming. Yet a few community projects had recently been started in those places too.

Today’s urban farmers don’t just grow food to eat; they also see urban agriculture as a way of increasing the diversity of plants and animals in the city, bringing people from different backgrounds and age groups together, improving mental and physical health and regenerating derelict neighbourhoods.

Many new urban farming projects still struggle to find suitable green spaces. But people are finding inventive solutions; growing food in skips or on rooftops, on sites that are only temporarily free, or on raised beds in abandoned industrial yards. Growers are even using technologies such as hydroponics, aquaculture and aquaponics to make the most of unoccupied spaces.

Something fishy

Hydroponic systems were engineered as a highly space and resource efficient form of farming. Today, they represent a considerable source of industrially grown produce; one estimate suggests that, in 2016, the hydroponic vegetable market was worth about US$6.9 billion worldwide.

Hydroponics enable people to grow food without soil and natural light, using blocks of porous material where the plants’ roots grow, and artificial lighting such as low-energy LED. A study on lettuce production found that although hydroponic crops require significantly more energy than conventionally grown food, they also use less water and have considerably higher yields.

Growing hydroponic crops usually requires sophisticated technology, specialist skills and expensive equipment. But simplified versions can be affordable and easy to use.

Mandy Zammit/Grow Up, Author Provided

Hemmaodlat is an organisation based in Malmö, in a neighbourhood primarily occupied by low-income groups and immigrants. The area is densely built, and there’s no green space available to grow food locally. Plus, the Swedish summer is short and not always ideal for growing crops. Instead, the organisation aims to promote hydroponic systems among local communities, as a way to grow fresh food using low-cost equipment.

The Bristol Fish Project is a community-supported aquaponics farm, which breeds fish and uses the organic waste they produce to fertilise plants grown hydroponically. GrowUp is another aquaponics venture located in an East London warehouse – they grow food and farm fish using only artificial light. Similarly, Growing Underground is an enterprise that produces crops in tunnels, which were originally built as air raid shelters during World War II in London.

The next big thing?

The potential to grow food in small spaces, under any environmental conditions, are certainly big advantages in an urban context. But these technologies also mean that the time spent outdoors, weathering the natural cycles of the seasons, is lost. Also, hydroponic systems require nutrients that are often synthesised chemically – although organic nutrients are now becoming available. Many urban farmers grow their food following organic principles, partly because the excessive use of chemical fertilisers is damaging soil fertility and polluting groundwater.

To see whether these drawbacks would put urban growers off using hydroponic systems, my colleagues and I conducted a pilot study in Portsmouth. We installed small hydroponic units in two local community gardens, and interviewed volunteers and visitors to the gardens. Many of the people we spoke to were well informed about hydroponic technology, and knew that some of the vegetables sold in supermarkets today are produced with this system.

Many were fascinated by the idea of growing food without soil within their community projects, but at the same time reluctant to consume the produce because of the chemical nutrients used. A few interviewees were also uncomfortable with the idea that the food was not grown naturally. We intend to repeat this experiment in the near future, to see how public opinion changes over time.

And while we don’t think hydroponic systems can replace the enjoyment that growing food in soil can offer, they can save water and produce safe food, either indoors or outdoors, in a world with increasingly scarce resources. Learning to use these new technologies, and integrating them into existing projects, can only help to grow even more sustainable food.

As with many technological advancements, it could be that a period of slow acceptance will be followed by rapid, widespread uptake. Perhaps the fact that IKEA is selling portable hydroponic units, while hydroponic cabinets are on the market as components of kitchen systems, is a sign that this technology is primed to enter mainstream use.


Silvio Caputo is Senior Lecturer in the School of Architecture, University of Portsmouth.

This article was originally published on The Conversation website and has been republished with permission under a Creative Commons licence. Read the original article.

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Opportunity or necessity… what’s fuelling the growth in self-employment?

iStock_650068Small_BusinessManInMeadow

With unemployment reaching its lowest level since 1975, it may seem like the state of the labour market has improved in recent years. However, a closer look at the statistics suggests that this is not necessarily the case.

The strong performance in the labour market in part reflects the growth in self-employment, which has been a distinguishing feature of the labour market’s recovery since the last recession.

Growth in self-employment

There were almost 750,000 more self-employed in the UK workforce at the end of 2014 than at the start of the global financial crisis in 2008, representing a high proportion of the total net growth in jobs over this period. Self-employment accounts for over 15% of those in work in the UK – 4.8 million of a workforce of around 32 million. Between March 2008 and March 2017, self-employment accounted for almost a third of total employment growth.

The significance of the contribution of self-employment is highlighted in a recent article published in Regional Studies, which notes that of the 920,000 net new jobs created between quarter 1 of 2008 and quarter 2 of 2014, 693,000 were in self-employment.

There has also been a rise in the share of female self-employed and those that work part-time, in addition to growth in a broader range of industries and occupations among the self-employed.

Recent ONS figures also show that the growth in self-employment between 2001 and 2016 has been driven mainly by those who have a degree (or equivalent), leading to the share of the self-employed with a degree or equivalent increasing from 19.3% in 2001 to 32.6% in 2016 as a share of total self-employed. As a share of total employment (self-employed and employed), the figures show that relatively highly-qualified individuals are becoming more concentrated in the self-employed.

Earnings growth?

The reasons for this growth has been the subject of much debate, particularly as research suggests many fail to earn a decent living. This recent analysis by the New Economics Foundation found that 54% of all self-employed people are not earning a decent living. It also found that the percentage of the labour force in ‘good jobs’ had decreased from 63% in 2011 to 61% in 2016, suggesting that the quality of jobs is perhaps declining.

Similarly, the ONS figures suggest that the self-employment labour market remains financially insecure for its workers. They show that the distribution of self-employed income appears centred around £240 a week, much lower than that for employees, which is centred around £400 a week.

And, according to a recent report from CIPD, their real incomes have fallen more since 2008 than those of employees.

Perhaps, then, the self-employment growth has been driven by necessity rather than choice due to a lack of opportunity in the full-time labour market.

However, the evidence suggests it is not this simple.

Despite the widening gap in earnings between the self-employed and employed, the self-employed continue to have higher levels of job satisfaction than employees. The ONS figures also indicate that self-employed workers were more likely to supplement their income from elsewhere.

This would suggest that choice probably plays a large part in self-employment.

‘Push’ or ‘pull’ effect

There has been much discussion over whether the growth in self-employment is predominantly a result of choice or necessity.

It is often seen as a sign of labour market weakness, with self-employment perceived as a ‘last resort’ where a regular job can’t be found. The evidence suggests that this motivation accounts for just a small proportion of the change, however, with most of the rise in self-employment appearing to be out of choice rather than necessity.

Indeed, the recent analysis in the Regional Studies article, which examined the extent to which self-employment was associated with local ‘push’ or ‘pull’ effects, found little or no suggestion of any net ‘recession-push’ effect on self-employment. It suggests that:

  • ‘pull’ factors are more significant in driving transitions into self-employment;
  • self-employed business ownership appears not to function as a significant alternative to unemployment where paid employment demand is weak; and
  • entrepreneurial activity prospers where local wages are higher and unemployment lower.

The uncertainty surrounding Brexit could also be having an effect as declining employer confidence has contributed to a growing number of short-term contracts – potentially making self-employment appear the better choice.

Final thoughts

As the CIPD report highlights, there are probably more opportunities for self-employment now than there were a decade ago. And the self-employed are more likely to value highly aspects of the work, such as its variety, and choice over their working hours and pay.

Across the range of job-related characteristics, it is shown that the self-employed are as satisfied or more satisfied with their working life than employees, resulting in higher levels of overall job satisfaction – a finding that is consistent both over time and from different data sources.

In a time where work-life balance is of increasing importance, it is perhaps no surprise that self-employment is the path of choice.


If you enjoyed reading this, you may also be interested in our previous blogs on the gig economy, ‘the self-employment boom’ and ‘olderpreneurs‘.

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‘Agent of Change’ protects music venues from noise complaints, but won’t stop them from closing

This guest blog was written by Marion Roberts, Professor of Urban Design, University of Westminster.

A Conservative minister for housing, a grey-haired Labour MP, ageing icons of rock and creative young people have formed an unlikely alliance in support of the Agent of Change (Planning) Bill. The proposed law, which will be discussed for the second time in the House of Commons on March 16, makes developers responsible for dealing with noise issues when they build new homes near music venues.

This all came about because people were worried about the high number of live music venues that were closing across the UK. The Greater London Authority (GLA) asked for a report on London’s grass roots music venues, only to find that 35% of them had been “lost” since 2007. Cities across the nation – from Glasgow to Manchester – have similar stories to tell, even though the government has recognised how important the music industry is for the economy.

So how did this happen? Many different governments since around the year 2000 have tried to get more flats and houses built in cities, because there aren’t enough for everyone who wants to live there. Many homes have been built on “brownfield” sites – where there used to be factories or warehouses, which are now used less or not at all. These types of places also offered spaces where creative entrepreneurs could set up new clubs, or take over existing venues and attract new customers with the offer of live music.

Buyer beware

But as people move into the new flats built on these sites (which they often pay a lot of money for) some inevitably complain about the noise coming from the venues. Venue owners in Shoreditch (one of London’s hip neighbourhoods) actually put up signs warning would-be buyers that there are live music venues in the area.

Up until now, these complaints caused big problems for music venue owners, because planning principles were not on their side. The onus was on them to ensure their neighbours weren’t disturbed by music and loud noises. But putting in proper soundproofing or keeping customers quiet can be difficult and expensive.

This doesn’t just affect the kind of places run on a shoe string on the outskirts of town. Even London’s mighty Ministry of Sound – which has been a mecca for House music lovers since 1991 – was caught up in a lengthy planning application for a tower block of flats nearby – a case which eventually ended in the flats having to be soundproofed.

A matter of principle

The way the planning system works, is that local authorities in England and Wales produce their own development plans, which must align with national policy as set out in a 2012 document called the National Planning Policy Framework (NPPF). This document made a small move to protect venues, by saying that if they wanted to expand, then there should be no unreasonable restrictions. But it didn’t address the situation described above.

Some local authorities have already started to draw up their own policies, which put the burden of noise reduction measures firmly on the developer who is making the change – whether it’s for flats or other uses. This is the legal principle, known as the “Agent of Change”. The bill, now supported by government, will ensure that the principle is embedded in the NPPF – so all local authorities will have to follow it. It will also carry more weight in appeals against planning decisions.

Although the “Agent of Change” principle will help prevent live music venues from closing, it won’t be enough on its own. Sadly, it would not address other issues such as rising rents, hikes in rateable values and property owners preferring to redevelop their buildings into flats. For example, consultancy firm Nordicity estimated that a revaluation of business rates would cause a fifth of London’s grass roots venues to close. And London’s oldest LGBTQ venue, the Royal Vauxhall Tavern, is still engaged in a battle to save it from redevelopment, by way of a community buy out.

Yet past examples show that people can save their local pubs from closure, whether through local campaigning or by taking ownership of the buildings. And to see creativity and culture, especially for young people, supported through the dusty corridors of parliament, is truly heart warming.


Marion Roberts is Professor of Urban Design, University of Westminster.

This article was originally published on The Conversation website and has been republished with permission under a Creative Commons licence. Read the original article.

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The year that was: looking back on a year of policy and practice on The Knowledge Exchange blog

Before bidding farewell to 2017, there’s just time to reflect on some of the issues we’ve been covering in The Knowledge Exchange blog during the past twelve months. There’s been no shortage of subjects to consider, from health and social care and devolution to  universal credit and town planning.

Missing EU already?
Of course, the major issue dominating policy in the UK this year has been Brexit. In July, we reviewed a new book by Professor Janet Morphet which assessed the UK’s future outside the European Union. While not claiming to have all the answers, the book provides a framework for making sure the right questions are asked during the negotiation period and beyond.

One important consideration concerning Brexit is its potential impact on science, technology and innovation. In August, we noted that, while the UK government has been making efforts to lessen the concerns of researchers, anxieties remain about funding and the status of EU nationals currently working in science and technology roles in the UK.

Home thoughts, from home and abroad
Throughout the year, we’ve been looking at the UK’s chronic housing crisis. In May, we considered the potential for prefabricated housing to address housing shortages, while in August, we looked at the barriers facing older people looking to downsize from larger homes. In October, we reported on the growing interest in co-housing.

The severe shortage of affordable housing has had a significant impact on homelessness, and not only in the UK. In April, we highlighted a report which documented significant rises in the numbers of homeless people across Europe, including a 50% increase in homelessness in France, and a 75% increase in youth homelessness in Copenhagen.

One European country bucking this trend is Finland, and in July our blog looked at the country’s success in reducing long term homelessness and improving prevention services. Although the costs of Finland’s “housing first” approach are considerable, the results suggest that it’s paying off: the first seven years of the policy saw a 35% fall in long term homelessness.

Keeping mental health in mind
A speech by the prime minister on mental health at the start of the year reflected growing concerns about how we deal with mental illness and its impacts. Our first blog post of 2017 looked at efforts to support people experiencing mental health problems at work. As well as highlighting that stress is one of the biggest causes of long-term absence in the workplace, the article provided examples of innovative approaches to mental illness by the construction and social work sectors.

A further post, in August pointed to the importance of joining up housing and mental health services, while in September we explored concerns that mobile phone use may have negative effects on the mental health of young people.

Going digital
Another recurring theme in 2017 was the onward march of digital technologies. In June, we explored the reasons why the London Borough of Croydon was named Digital Council of the Year. New online services have generated very clear benefits: in-person visits to the council have been reduced by 30% each year, reducing staffing costs and increasing customer satisfaction from 57% to 98%.

Also in June, we reported on guidance published by the Royal Town Planning Institute on how planners can create an attractive environment for digital tech firms. Among its recommendations: planners should monitor the local economy to get a sense of what local growth industries are, and local authorities should employ someone to engage with local tech firms to find out how planning could help to better facilitate their growth.

Idox in focus
Last, but not least, we’ve continued to update our readers on new and continuing developments at the Idox Information Service. Our blog has featured articles on the Research Online, Evaluations Online and Ask-a-Researcher services, as well as the Social Policy and Practice database for evidence and research in social care. We were proud once again to sponsor the 2017 RTPI Research Excellence awards, and highlighted the winning entries. And following an office move, in September we explored the fascinating history behind the building where we now do business.

Back to the future
2018 is already shaping up as an important year in policy and practice. One important issue exercising both the public and private sectors is preparing for the General Data Protection Regulation. The Knowledge Exchange blog will be keeping an eye on this and many other issues, and the Idox Information Service, will be on hand to ensure our members are kept informed throughout 2018 and beyond.

Thank you for reading our blog posts in 2017, and we wish all of our readers a very Happy Christmas and a peaceful and prosperous New Year.


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Figuring it out: five issues emerging from the Scottish draft budget

The week before Christmas might not seem an ideal time to be mulling over the minutiae of economic forecasts and the implications of tax changes. But on Monday morning, the Fraser of Allander Institute (FAI) review of last week’s Scottish draft budget attracted a big turnout, and helped make sense of the numbers announced by Scotland’s Finance Secretary, Derek Mackay.

Here are some of the key issues to emerge from yesterday morning’s presentations.

  1. Growth: degrees of pessimism

Last month, the UK Office for Budget Responsibility revised downwards its growth forecast for the UK economy to less than 2%. The FAI, meanwhile, has forecast a slightly lower growth rate for the Scottish economy of between 1% and 1.5%. However, the independent Scottish Fiscal Commission (SFC) is much more pessimistic, forecasting growth in the Scottish economy of less than 1% up to 2021. If the SFC’s forecast turns out to be accurate, this would mean the longest run of growth below 1% in Scotland for 60 years.

Dr Graeme Roy, director of the FAI, suggested that the SFC’s gloomy outlook is based on the view that the Scottish working-age population is projected to decline over the next decade. In addition, the SFC also believes that the slowdown in productivity, which has been a blight on the Scottish economy since the 2008 financial crisis, will continue.

  1. Income tax rises: reality v perception

Mr Mackay proposed big changes in Scotland’s tax system, with five income tax bands stretching from 19p to 46p. While these measures attracted the biggest headlines for the budget, the FAI believes that most people will see little meaningful impact in their overall tax bill (relative to income). Charlotte Barbour, director of taxation at the Institute of Chartered Accountants of Scotland, also suggested that the tax changes are unlikely to result in any significant behavioural changes in the way people pay tax in Scotland. And, as has been noted elsewhere, high taxation does not necessarily lead to unsuccessful economies.

However, as the FAI highlighted, perception is important, and if Scotland comes to be seen as the most highly taxed part of the UK, this could have serious implications for business start-ups and inward investment.

  1. Taxation: two systems, multiple implications

Charlotte Barbour also highlighted some of the implications of the tax changes in Scotland that haven’t featured widely in press coverage. How the changes interact with areas such as Gift Aid, pensions, the married couple’s tax allowance, Universal Credit and tax credits will need careful examination in the coming weeks.

  1. Public spending: additional resources, but constrained settlements

The FAI’s David Eiser noted that Mr Mackay was able to meet his government’s commitments to maintain real terms spending on the police and provide £180m for the Attainment Fund. He also announced an additional £400m resource spending on the NHS. But these settlements are constrained in the context of the Scottish Government’s pay policy,

Mr Mackay’s plan offers public sector workers such as nurses, firefighters and teachers earning less than £30,000 pounds a year a 3% pay rise, and those earning more than that a 2% rise. For the NHS alone, this could cost as much as £170m.

In addition, analysis published yesterday by the Scottish Parliament Information Centre (SPICE) has estimated that, if local authorities were to match the Scottish Government’s pay policy, this would cost around £150m in 2018-19.

  1. The budget’s impact on poverty

If the growth forecasts are correct, even by 2022 real household incomes in Scotland will be below 2007 levels. Dr Jim McCormick, Associate Director Scotland to the Joseph Rowntree Foundation, looked at the Scottish budget in the context of poverty, and suggested that three principles need to be addressed before the budget can be finalised: there are opportunities both to increase participation by minority groups in employment and to improve progression in low-wage sectors, such as hospitality and retail; energy efficiency is one important way of lowering household bills and improving housing quality in the private rented sector; and options such as topping up child tax credits and more generous Council Tax rebates are better at reducing poverty than cutting income tax.

Finalising the budget

As all of the speakers noted, the Scottish draft budget is not a done deal. The minority Scottish National Party government in the Scottish Parliament needs the support of at least one other party to ensure its measures are adopted. The most likely partner is the Scottish Green Party, which has indicated that the budget cannot pass as it stands, but could support the government if an additional £150m is committed to local government.

It took until February this year before the Scottish Government’s 2016 draft budget could be passed. Time will tell whether a budget announced shortly before Christmas 2017 can finally be agreed before Valentine’s Day 2018.

The complete collection of slides presented at the Fraser of Allander Institute’s Scottish budget review are available to download here.


Our blog post on the Fraser of Allander Institute’s review of the Chancellor of the Exchequer’s 2017 Autumn Budget is available here.

“Shifting into reverse” – the global gender gap

Gender equality

Image by GDJ via Creative Commons

By Heather Cameron

“Gender parity is shifting into reverse” – this was the finding of the World Economic Forum’s (WEF’s) most recent annual Global gender gap report, published last month.

This is the first time progress, albeit slow, towards gender parity has stalled since the WEF started measuring it in 2006.

Widening gap

On current trends, the overall global gender gap can be closed in exactly 100 years, compared to 83 years reported in last year’s report.

The economic situation is even worse.

Last year, we reported on the gender pay gap, which highlighted the WEF’s 2016 findings that the global economic gender gap will take 170 years to close. This year’s WEF report indicates that women may now have to wait over 200 years to achieve equality in the workplace:

“given the continued widening of the economic gender gap already observed last year, it will now not be closed for another 217 years.”

According to the report, the gaps between women and men on economic participation and political empowerment remain wide. Just 58% of the economic participation gap has been closed – a second consecutive year of reversed progress and the lowest value measured by the Index since 2008 – and about 23% of the political gap, unchanged since last year against a long-term trend of slow but steady improvement.

For the other indicators, the 144 countries covered in the report have closed 96% of the gap, on average, in health outcomes between women and men, unchanged since last year, and more than 95% of the gap in educational attainment, a slight decrease on last year.

Overall, an average gap of 32.0% remains to be closed worldwide in order to achieve universal gender parity, compared to an average gap of 31.7% last year.

The most challenging gender gaps remain in the economic and health spheres.

Country-level

The situation is more nuanced at the country and regional level, however. And the report highlights that a number of regions and countries have crossed “symbolic milestones” for the first time this year.

Countries that improved the economic gender disparity included France and Canada. The UK was one of the most improved this year in general, up five places on last year to 15th place. The report also notes that the UK has made notable progress on political empowerment and women in ministerial positions.

Despite this, the UK still performed more poorly than many other developed countries in a number of categories and things still need to be improved on economic and political participation in the UK.

The lack of any of the G20 nations within the top 10 has also been noted, suggesting that economic power does not necessarily equate to better gender equality. The WEF estimate that the UK could add $250bn to its gross domestic product (GDP) by achieving gender parity.

Final thoughts

Clearly, the importance of gender parity cannot be ignored, not only because it’s unfair but because it can also lead to better economic performance.

The WEF report argues that a key avenue for further progress is the closing of occupational gender gaps, which will require changes within education and business sectors and by policymakers.

It still appears to be the case that higher earning jobs are more commonly held by men. And with recent research suggesting that there is gender bias in job adverts across the UK, such changes can’t come soon enough.


If you enjoyed reading this, you may also like our other posts on the gender pay gap and the place of women in the ‘changing world of work’.

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Focus on: Evaluations Online

 

Evaluations Online is a public portal providing access to a collection of evaluation and economic development research reports commissioned by Scottish Enterprise, Scotland’s main economic development agency.

Ensuring that public investment generates economic and social benefits, and long-term inclusive growth for Scotland is core to Scottish Enterprise’s remit. Making evaluation and research reports publicly available, supports this aim as well as ensuring transparency.

Some of the most popular recent reports added to the site have focused on:

Working in partnership

Since 2007, Idox has been working with Scottish Enterprise to deliver Evaluations Online using a publishing platform designed specifically to deal with research material. Users can easily navigate to and assess the relevance of material thanks to specially-written abstracts and structured search functions based on a bespoke classification and record structure.

The site now contains over 600 evaluation and research reports commissioned by Scottish Enterprise, dealing with different aspects of economic development activity such as business support, investment, sector growth and improving skills. All of the reports are publicly accessible and free to access.

Since the site launched we have continued to refresh and improve the site, ensuring it better meets the needs of key user groups, including economic development policy-makers and practitioners across Scotland. In the last quarter of 2016, the reports hosted on the site were accessed over 30,000 times.

The importance of evaluation

We’ve highlighted the importance of evidence and evaluation and assessment of information quality on the blog several times before. It’s worth repeating that repositories of evidence can help bring about better policy in a number of ways:

  • improving accountability by making it easier for people to scrutinise the activities and spending of public sector organisations – this helps organisations meet Freedom of Information responsibilities;
  • improving the visibility and therefore the impact of evidence;
  • helping identify gaps in evidence by making it easier to compare research findings; and
  • increasing our understanding of what works (‘good practice’), not only in the activities covered, but also in evaluation and research methods.

We’re proud to support Scottish Enterprise in the dissemination of their evaluation and research output, through a portal which they believe increases the return on these activities.


You can find out more about the projects The Knowledge Exchange team has been involved in, and the consultancy services we offer, here.