Tag Archives: benefits

Universal basic income: too good to be true?

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“I am now convinced that the simplest approach will prove to be the most effective – the solution to poverty is to abolish it directly by a now widely discussed measure: the guaranteed income.” Martin Luther King, 1967

It may come as a surprise to learn that the current ‘hot topic’ of universal basic income (UBI) – also known as basic income or income guarantee – is actually over 500 years old.

It was first developed by radicals such as philosopher Sir Thomas More in the 16th century, drawing upon humanist philosophy.  It was mooted by Thomas Paine in the 18th century, and then again in the mid-20th century, by economists such as James Tobin and Milton Friedman.  In 1967, Martin Luther King called for a ‘guaranteed income’ to abolish poverty, and in the 1970s, a basic income experiment ‘Mincome’ was conducted in Canada.

However, only in recent years has debate on universal basic income (UBI) moved into the mainstream.

From the threat of job losses from automation and artificial intelligence, an overly complex and bureaucratic welfare system that has been branded ‘unfit for purpose’, to the failure of conventional means to successfully tackle unemployment over the last decade – basic income has been hailed as a key way to reduce inequality and provide a basic level of financial security upon which individuals can build their lives.

It has many current supporters – including billionaires Elon Musk, Mark Zuckerberg, and Richard Branson.  There is support among the general public too, with a recent poll reporting that nearly half of all adults aged 18-75 in the UK (49%) would support the UK Government introducing UBI at the level to cover basic needs in principle.

 

How does it work? 

In essence, UBI offers every citizen a regular payment without means testing or requirement for work.

Trials of different models of basic income have been conducted around the globe, including Kenya, Finland, and Canada.  There are also UBI trials planned in the district of Besós in Barcelona, Utrecht in the Netherlands and the Finnish city of Helsinki.  Closer to home, four areas in Scotland are also currently designing basic income pilots – Glasgow, Edinburgh, Fife and North Ayrshire.

While there have been many different models of basic income trialled and assessed over the years, in general, basic income schemes share five key characteristics:

  • Periodic: it is paid at regular intervals, not as a one-off grant.
  • Cash payment: it is paid in an appropriate medium of exchange, allowing those who receive it to decide what they spend it on. It is not paid in kind (such as food or services) or in vouchers with a specific use
  • Individual: it is paid on an individual basis—and not, for instance, to households.
  • Universal: it is paid to all, without means test
  • Unconditional: it is paid without a requirement to work or to demonstrate willingness-to-work

 

Anticipated benefits

The key anticipated benefits of the introduction of UBI is a reduction in inequality and poverty. However, advocates claim that it would also have many other benefits.  These include:

  • simplifying the existing welfare system (including efficiency gains)
  • reducing the psychological burden and stigma associated with welfare benefits
  • achieving more comprehensive coverage – no one ‘slipping through the net’
  • fixing the threshold and ‘poverty trap’ effects induced by means-tested schemes
  • enabling individuals to continue education and training, or retrain, without financial constraint dictating choices
  • making childcare arrangements easier
  • rewarding unpaid contributions such as caring and volunteer work
  • improving gender equality and help women in abusive situations
  • improving working conditions
  • addressing predicted future mass unemployment as a result of automation

 

Criticism

The key argument against the introduction of UBI is its cost – essentially that “an affordable UBI would be inadequate, and an adequate UBI would be unaffordable”.

Critics argue that if UBI were set at a level that enabled a modest, but decent standard of living on its own, then it would be unaffordable – either requiring much higher taxes, and/or the redistribution of funds from other areas, such as education or health.

However, if UBI was set too low, it would not provide an adequate income to live on, and it may be exploited as a subsidy for low wages by unscrupulous employers.

Others, such as economist John Kay, have argued that UBI simply would not have the redistributive effects intended.  Rather than improving the lives of those most in need, who would receive more or less the same as they do under existing welfare systems, it would instead provide more for the middle classes.

There is also some concern that UBI may undermine the incentive to work, and lead to the large-scale withdrawal of women from the labour market.

 

What does the evidence say?

Certainly, there is a beauty in the simplicity of UBI – and no one can argue against the goals of reducing inequality and poverty.  However, in truth, there just isn’t enough evidence available yet to judge whether or not the full-scale introduction of UBI would be successful.

While many pilots have demonstrated positive results, most have been of limited size and scope, and it is difficult to extrapolate these findings to the wider population.

Analyses by a wide range of organisations – including the RSA, the Joseph Rowntree Foundation, the OECD, and the International Monetary Fund, have drawn mixed results.

For example, a review conducted by Bath University in 2017 concluded that:

“The unavoidable reality is that such schemes either have unacceptable distributional consequences or they simply cost too much. The alternative – to retain the existing structure of means-tested benefits – ensures a more favourable compromise between the goals of meeting need and controlling cost, but does so at the cost of administrative complexity and adverse work incentive effects.”

Similarly, the IMF conclude that in the UK and France, UBI would be inferior to existing systems in targeting poverty and inequality. However, there are some aspects of UBI that are difficult to model, such as the behavioural impacts of having economic security.  Trials and experimentation are important sources of such information.

Thus, the planned trials of UBI in Scotland and elsewhere may well help to provide further answers.  And we – along with others around the world – will be watching with interest.

As First Minister, Nicola Sturgeon aptly puts it:

“It might turn out not to be the answer, it might turn out not to be feasible. But as work and employment changes as rapidly as it is doing, I think it’s really important that we are prepared to be open-minded about the different ways that we can support individuals to participate fully in the new economy.”

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Walk this way- the benefits of walking for people and cities

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“In a quality city, a person should be able to live their entire life without a car, and not feel deprived” – Paul Bedford, City of Toronto Planning Director (2014)

Improvements to the design and layouts of streets and cities can have a significant impact on encouraging more of us to walk. However, many people living in cities face a significant number of barriers to being physically active where they live, particularly in relation to walking. Pathways and public spaces such as parks and throughways are often unappealing, unsafe, congested, traffic filled, noisy or for some completely inaccessible, which leads to a reliance on vehicular travel and a reluctance to be physically active within the city environment.

Walkable environments consider not only the physical design of routes, but also features and facilities that are inclusive of the widest possible range of needs; for example, places for people to rest along their journeys (including well designed seats and benches), accessible toilet facilities, signage and street design that is sensitive to a range of needs and that can help with orientation and wayfinding. However, the benefits are clear across the board when it comes to trying to make our cities more walkable (and as a result healthier). This blog post outlines a few of these potential benefits, and considers how planners can get involved in realising some of them through effective planning and design in their own cities.

Social benefits
Safe, walkable, environments can provide opportunities for people of all ages and abilities to stay socially connected and engaged. This can be particularly helpful in communities with a lot of children, older people or vulnerable adults. Having areas that are known to be safe can help to encourage people to leave their homes, reducing the impact of loneliness and social isolation, and improving their sense and feeling of community in their local area, which in turn can help with health and wellbeing and community cohesion.

Health benefits
Walking is good for us! In August this year a survey by Public Health England revealed that four in 10 middle-aged adults fail to manage even one brisk 10-minute walk a month. This despite research showing that walking each day can rapidly reduce risk of health conditions such as stroke and heart attack. Promoting active lifestyles through encouraging walking has also been shown to help tackle the growing issue of obesity, particularly among younger people. Walking can also be good for mental health, particularly when it is done as a group. Increasingly, walking interventions are being prescribed as part of social prescription initiatives to help people regain health, fitness and confidence. But in order for these to be effective, spaces and suitable environments for walking need to be made available.

Environmental benefits
For many cities, London, Manchester and Glasgow included, congestion and air pollution are major issues. Creating walkable cities, and encouraging walking, cycling and other more environmentally friendly modes of transport can have a significant impact on the levels of pollution within an area. Reducing vehicle use can also have an impact on noise, water, thermal and light pollution in our cities too. Some attempts are being made to reduce the level of pollution in our cities – vehicles in central London have been subject to a congestion charge for a number of years. However, recent developments and attempts to reduce the high levels of air pollution in the city have led to the introduction of the “T-Charge”. It has been suggested that the money raised from this charge could be used to fund green transport initiatives, and this includes improving cycle and walkways and making streets more easy to navigate on foot.

Economic benefits
Walkable spaces can act as a catalyst for local economic vitality, regeneration and tourism. Research has shown that improving public spaces, and creating an environment which encourages more people to walk safely, (and free from the noise, smell and feelings of claustrophobia that can come with high levels of car traffic) has a significant and positive impact on businesses, resulting in people spending more time, but also more money in shops and town centres.

Creating walkable cities: what can be done to help
Planners and city officials are increasingly aware of the need to promote more open, safe and accessible public spaces in new development areas. However, some cities have already implemented practices that could be taken forward in the future. Organisations like Living Streets have produced road maps and blueprints of how cities can use planning to improve public spaces, make them walker friendly and reduce reliance on vehicles. Consultancies like Arup have also produced research on the benefits of creating “walkable cities” and in 2014 RTPI launched their own report on the benefits of planning for “healthier cities” (which includes provision for making cities more walkable). In 2017 the World Health Organisation (WHO) published a briefing on transforming public spaces to promote physical activity in cities. There are a number of ways in which planners and city planning teams can have a positive impact on promoting change to encourage more walking in our cities including:

  • Create walkable neighbourhoods – In Melbourne a “local connectivity plan” was introduced in 2014. The plan was used to build a network of neighbourhoods which had social, leisure and retail facilities within a 20 minute walk of people’s homes.
  • Prioritise walking, and “walkable spaces” in development and regeneration plans – The mayor of London appointed a walking and cycling commissioner in 2017, whose role is to make walking and cycling easier and safer across the capital. The mayor’s new ‘healthy streets’ approach is a commitment to a system of healthy streets and strategies that will help Londoners use cars less and walk, cycle and use public transport more.
  • Make walking safe – Designing walkways and footpaths that incorporate wide, well lit pathways, well signposted and nicely designed and maintained routes has been shown to be one of the main factors in encouraging people to walk more within their local area.
  • Make walking easy (and fun) – Go Jauntly is a new walking app that uses photographs rather than maps to guide users on routes around woods and byways. Walkers can add their own routes, and it is hoped that it the app will “increase the social appeal of people walking together” coming up with new routes within their own neighbourhoods, or areas they like to walk in.

If you found this article interesting, you might also like to read our previous blogs:

It’s a kind of magic: how green infrastructure is changing landscapes and lives

Hidden in plain sight – the value of green spaces

Follow us on Twitter to see what developments in public and social policy are interesting our research team.

Are controversial ‘fix rooms’ a solution or a problem?

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By Steven McGinty

In August, Glasgow City Alcohol and Drug Partnership (ADP) announced that it had found a potential site for its pilot drug consumption facility.

This new service provides drug users with a place to inject drugs under clinical supervision and discard their needles. Other services may also be offered, including the prescription of pharmaceutical grade heroin (administered under strict controls) and the development of a peer support network.

The site in Glasgow’s city centre would be the first in the UK and it’s hoped that it would be up-and-running by 2018. However, these proposals have been met with a mixed response.

Drug consumption rooms

First established in Bern, Switzerland, in 1986, drug consumption rooms were a response to concerns over the spread of HIV/AIDS, increases in drug related deaths, and the rise of public drug deaths in European cities. They were also part of a wider shift in drugs policy, where traditional abstinence-based approaches were being replaced by harm reduction programmes, which focused on reducing the negative impacts of drug abuse.

Since then, over 90 drug consumption facilities have been opened in countries such as Denmark, Germany, the Netherlands, and Canada.

The case for Glasgow

Approximately 500 drug users inject in public places in the city centre. This small group of people accounts for the majority of discarded needles – a major public health risk for the city – and for many instances of public order problems. As a result, Glasgow City Council, Police Scotland and other agencies are spending significant resources managing drug misuse in the city centre.

Although this small group of public injectors provides challenges, they are also vulnerable and often experience other issues such as homelessness, mental health issues, and recent imprisonment. In particular, they are far more likely to suffer health problems. This includes an increased risk of blood-borne viruses, injecting-related serious infections, and overdoses and drug-related deaths. In recent years, the statistics have shown a decline in the health of Glasgow’s drug users. In 2015, the number of HIV infection cases rose from a consistent 10 to 47 per year. Drug-related deaths also rose from 157 to 170 in 2016.

As Susanne Millar, chief officer of Planning, Strategy and Commissioning for the Glasgow City Health and Social Care Partnership, and chair of the ADP, explains:

“People injecting drugs in public spaces are experiencing high levels of harm and are impacting on the wider community. We need to make our communities safer for all people living in and visiting the city, including those who publicly inject.”

What the experts say

Many have welcomed the announcement.

Dr Emilia Crighton, director of Public Health at NHS Greater Glasgow and Clyde, and vice chair of the ADP, argues that Glasgow is decades behind other countries in how it responds to drug addiction. She highlights that the city has been at the centre of high profile cases of anthrax, botulism and HIV infection, and that conventional treatment has not been successful at reducing health risks. She explains:

“Our ultimate goal is for drug users to recover from their addiction and remain drug free. However, until someone is ready to seek and receive help to stop using drugs it is important to keep them as safe as possible while they do continue to use drugs.”

David Liddell, Chief Executive Officer of the Scottish Drugs Forum, is also in favour of the new facility, explaining that they have been successful in other countries.

“They may seem controversial but when you see that these have been running in many countries in Europe for up to 30 years, you get a different perspective. Holland now has 31 drug consumption rooms and Germany has 24, for example. From these years of practice, clear evidence has emerged as to the effectiveness of these facilities.”

But there has also been some notable criticism. For example, Professor Neil McKeganey, an expert in drugs policy with the Centre for Substance Use Research in Glasgow, argued that the scheme is highly flawed. He believes that David Liddell is wrong, and contends that the proposed facilities are controversial. Professor McKeganey highlights previous research with drug addicts in Scotland which found that only 5% wanted to inject more safely, with the overwhelming majority wanting to receive treatment and become drug free. Professor McKeganey also suggests that ‘supposedly’ safer places to inject will not reduce the rising cases of HIV infection and other drug-related harms.

He warns that although these services have a role to play, “there is a real danger here we are moving steadily away from services to get addicts off drugs.”

Final thoughts

There is a growing body of research into the effectiveness of drug consumption rooms. The European Monitoring Centre for Drugs and Drug Addiction has found that drug consumption facilities can deliver a number of benefits, including:

  • increasing access to health and social services;
  • supporting safe and hygienic drug use; and
  • reducing public drug use and associated nuisance.

However, the evidence on whether drug consumption rooms reduce cases of HIV or the hepatitis C virus remain unclear. And research has also shown that some countries can find it difficult to establish a legal basis for facilities – as the recent suspension of a facility in Greece demonstrates.

For Glasgow, it probably is about time that a drug consumption room was piloted. However, it will be important that its impacts are fully evaluated and that resources for drug treatment services are maintained in the coming years.

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If you found this article interesting, you may also like to read some of other health-related articles. 

Delivering digital transformation: the mixed successes of the Government Digital Service

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By Steven McGinty

It’s been a period of change for the Government Digital Service (GDS) since losing influential Executive Director Mike Bracken in 2015. Since then, the service has experienced a string of high profile departures, leading many commentators to suggest that the much-lauded GDS could soon be coming to an end.

However, in the November 2015 Spending Review, then Chancellor George Osborne announced that the GDS would receive an extra £450 million over four years – a significant increase on their previous budget of £58 million per year.

Chancellor Osborne highlighted that these additional funds would help fuel a “digital revolution” in central government, and in particular create one of the most digitally advanced tax administrations in the world.

But has new funding – and possibly the public show of support – led to a digital revolution?

In the beginning….

In 2011, the GDS was formed to implement the ‘digital by default’ strategy – a key proposal of UK Digital Champion (and founder of lastminute.com) Martha Lane Fox’s report into the delivery of online public services.

The GDS’s first major project, GOV.UK, has in many ways proved to be a success. Launched in 2012, the publishing platform brought together over 300 government agencies and arm’s length bodies’ websites within 15 months. Replacing DirectGov and Business Link alone has saved more than £60m a year. Early testing showed GOV.UK was simpler for users, with 61% completing tasks on the new Business Link section; compared to 46% on the old website.

GOV.UK has also been viewed as an example of best practice, with GDS team members supporting countries such as New Zealand with their own digital government efforts.

However, it’s not been entirely without its controversies. In October 2016, the Welsh language commissioner accused the UK government of weakening Welsh language services, explaining that provision on the site had “deteriorated astonishingly” since the introduction of GOV.UK. A recent GDS blog article has also identified challenges in making content accessible for users. For example, 73% of the content on GOV.UK is looked at by fewer than 10 people per month.

Government as a platform

A major theme of the GDS’s work has been the introduction of a platform approach to digital government – principles proposed by technology guru Tim O’Reilly. In 2015, Mike Bracken set out a new vision for digital government, highlighting the need to create:

“A common core infrastructure of shared digital systems, technology and processes on which it’s easy to build brilliant, user-centric government services.”

GOV.UK is one such service.

But the concept has gone on to inspire new services such as GOV.UK Verify – a platform which enables citizens to prove who they are when using government services. This common service was a world first and is being used by organisations such as HM Revenue & Customs (HMRC) and the Department for Environment, Food & Rural Affairs (DEFRA).

Additionally, GOV.UK Notify – a service which sends text messages, emails or letters – was introduced in January 2016. It helped support the Valuation Office Agency (VOA) transition some of their services to online only, as it provided them with the ability to send thousands of notifications at the one time.

National Audit Office

On 30 March 2017, the National Audit Office (NAO) published a report into the government’s track record on digital transformation.

The report concluded that the GDS had an early impact across government, successfully reshaping the government’s approach to technology and transformation. However, Amyas Morse, head of the National Audit Office, also observed that:

“Digital transformation has a mixed track record across government. It has not yet provided a level of change that will allow government to further reduce costs while still meeting people’s needs. To achieve value for money and support transformation across government, GDS needs to be clear about its role and strike a balance between robust assurance and a more consultative approach.”

In particular, the NAO highlights concerns over the GOV.UK Verify programme. The service has proven difficult to adopt for some departments, which has led to the GDS allowing the use of alternate identity services. According to the NAO, this significantly undermines the business case for GOV.UK Verify, and provides a poorer experience for users on government websites.

The Institute for Government

Influential think tank, the Institute for Government (IfG), has recently published two reports on the progress of digital transformation.

In October 2016, the report ‘Making a success of digital government’ estimated that the UK Government could save up to £2 billion by 2020 – through efficiency savings – by creating better digital services. Major digital transformation successes were also highlighted, including the online registration to vote by 1.3 million people by May 2016, and the introduction of a new digital road tax system (removing the need for paper disks).

In terms of the GDS, the IfG expressed similar views to the NAO:

“We found that GDS has played an important role in bringing new digital capability into government. But, in the absence of a new digital strategy, its role is unclear. GDS needs to re-equip itself to support a government that now has rapidly developing digital capability, and high ambitions for change.”

In February 2017, the government published a new digital transformation strategy, including attempting to clarify the ‘evolving’ role of the GDS.

However, this hasn’t stopped the IfG making several new recommendations for the GDS in their latest digital government report. These include:

  • clarifying the GDS standards and distinguishing between standards and guidance;
  • re-examining the role of the Government Gateway – an identity assurance platform – and of GOV.UK Verify;
  • taking a more active role in the digital services market, such as designing the Digital Marketplace for different users; and
  • creating a store for Application Programming Interfaces (APIs) to encourage their use throughout the public sector.

Final thoughts

The GDS has played a vital role in creating a new vision for digital government. However, evidence has suggested that over recent years the pace of change has slowed, with key initiatives such as GOV.UK Verify facing a variety of challenges.

In the coming years, it’s likely that the Brexit negotiations will be top priority for politicians and many government departments. It will be important that the GDS works with these departments and looks to prioritise services that are vital for managing the Brexit process.

Follow us on Twitter to see what developments in public and social policy are interesting our research team. If you found this article interesting, you may also like to read our other digital articles

Universal Credit – “forcing many into debt”

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Jul 07 Dealing With Debt - Magnifying Glass

By Heather Cameron

“The biggest change ever made to the benefits system… is currently failing too many people and forcing many into debt.”

This is the conclusion of a new report from Citizens Advice on Universal Credit (UC). It warns that the roll-out should be paused to allow ‘significant problems’ to be fixed.

What is Universal Credit?

UC was introduced in 2013, with the aim of simplifying the benefits system, making transitions into work easier and making every hour of work pay. UC replaces six means-tested benefits and tax credits with one benefit, to be paid in arrears, as a single household payment, on a monthly basis.

The objective of UC is to help people on low incomes or not in work to meet their living costs. It affects a range of people, both employed and unemployed, disabled people with health conditions, single people, families, homeowners and renters.

Roll-out so far has been gradual but the process is to speed up considerably from October. By the end of roll-out in 2022, it is expected around 7.2 million households will receive UC, over half of which will be in work.

With such a significant number of people affected, it is imperative that the system works in their interests. But evidence from Citizens Advice suggests the system has a number of flaws that need addressing to prevent 7 million households from facing serious financial risk.

And this isn’t the first time similar conclusions have been reached.

Flaws

Back in February, a Guardian investigation found that policy design flaws in UC are pushing thousands of benefit claimants into debt. Former welfare minister Lord Freud also admitted to MPs that administrative problems and design issues with UC are causing around one in four low-income tenants to run up rent arrears, putting them at risk of eviction.

In 2016, an inquiry into UC and its implementation by the Public Accounts Committee highlighted the inflexibility of the payment systems which may cause financial hardship for some claimants.

Citizens Advice highlight three “significant problems” with UC:

  • people are waiting up to 12 weeks for their first payment without any income;
  • UC is too complicated and people are struggling to use it; and
  • people aren’t getting help when the system fails them.

The data shows that:

  • more than one in three people helped on UC by Citizens Advice are waiting more than six weeks to receive any income, with 11% waiting over 10 weeks;
  • nearly a third of people helped have to make more than 10 calls to the helpline to sort out their claim;
  • 40% of people helped said they were not aware they could get an advance payment to help with the initial waiting period for their first payment;
  • over half of the people helped borrowed money while waiting for their first payment; and
  • UC clients are nearly one-and-a-half times as likely to seek advice on debt issues as those on other benefits.

A recent report from the Joseph Rowntree Foundation similarly highlighted the issue of waiting time, arguing that it required immediate action.

While Citizens Advice support the principles of UC, it argues that pushing ahead with roll-out while these problems remain will only put thousands more families at financial risk.

Recommendations

In response to these findings, a number of short and longer term considerations were highlighted where action will be needed to help secure the aims of UC by the end of roll-out. These include reducing the six week wait for initial payment, improving the support available for those moving onto UC, and helping people achieve financial stability on UC.

The charity recommends that the roll-out is paused while the government addresses the significant issues that have been highlighted. If improvements are not made, it is argued that both UC claimants and the government will face significant financial risks, which will increase rapidly if thousands more households move onto the benefit later this year.

If you enjoyed reading this, you may also like our previous article on in-work poverty.

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Hidden in plain sight – the value of green spaces

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jardin public

By Heather Cameron

They may be something most of us see every day but take for granted – the area of green space we pass on our way to work or frequent in our lunch break. And although we might make use of such spaces on a regular basis, is the true value of them really understood?

As highlighted by a recent report from the Land Trust, green spaces provide even more to society than we often think about.

Wider value

It has long been recognised that green spaces provide multiple benefits to communities and wider society, but there has been limited robust evidence on their wider economic value. The Land Trust report highlights that the services delivered by soil, grass, flowers, trees and water provide society and the economy with significant benefits.

It suggests that several important functions are provided by these green spaces, including:

  • Reducing and preventing flooding
  • Cleaning our water
  • Storing and removing carbon
  • Cleaning our air, reducing air pollution

Such functions help to alleviate costs to local and wider communities, such as to the health service, other public services and local businesses. Previous research has similarly alluded to such benefits.

Independent research by UK scientists in 2011 highlighted the true value of nature in relation to the economic, health and social benefits, estimating that it was worth billions of pounds to the UK economy.

Other research has also shown that green space has been linked to reduced levels of obesity in children and young people, and that access to open spaces is associated with higher levels of physical activity and reductions in a number of long-term conditions such as heart disease, cancer, and musculoskeletal conditions.

The proportion of green and open space is also linked to self-reported levels of health and mental health, through improved companionship, sense of identity and belonging and happiness. And living in areas with green spaces is associated with less income-related health inequality, thereby reducing the effect of deprivation on health.

What the Land Trust’s report does differently, is demonstrate these widely recognised benefits in physical and monetary terms to help create a greater understanding of the economic contribution of well-managed green spaces.

Natural capital accounting

A ‘natural capital accounting’ approach was taken to translate these benefits into financial terms, taking consideration of the physical land, its quality, how it is managed, used and the functions it performs.

Two different parks – Silverdale Country Park in the Midlands and Beam Parklands in London – were used in the study to demonstrate this value. Overall, Silverdale’s annual natural capital value was estimated to be £2.6 million, with a return on investment of £35 for every £1 invested, while Beam Parklands’ natural capital value, based on a 99 year period, has been valued at £42 million – an increase of £21 million since 2009.

Other benefits provided by Silverdale include:

  • Nearly £400,000 per year of flood risk reduction benefits
  • An annual value of £82,000 for the park and its maintenance to retain and purify water
  • A wider annual value of £840,000 of absorbed and stored carbon
  • A potential increase of 113% in local air pollution absorption since 2011

Other benefits provided by Beam Parklands (primarily a flood defence) include:

  • Nearly £600,000 per year of flood risk reduction benefits
  • Nearly £800,000 per year of educational and health benefits to the local community

As two well-maintained green spaces, they indicate the importance of long-term investment.

Final thoughts

Perhaps these financial values will help people to better comprehend the true value of our green spaces. As the report notes, it is important to remember that they are “not ‘one off’ monetary values or price tags” but rather an indication of what our green spaces are worth and their benefits to both society and the economy.

Put simply, as the Land Trust concludes, “green spaces… are valuable to society”.

If you enjoyed reading this, you may also like our previous articles on pocket parks and green spaces.

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Basic Income – a simple solution to a complex problem?

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By Heather Cameron

“If you want to incentivise work at every level of income then Basic Income is simply the best system.” (RSA, 2015)

Last month MPs in the UK Parliament were asked to consider the question of introducing a universal basic income to be payable unconditionally to all citizens without means-testing or work requirement.

The motion, which was tabled by Green Party MP Caroline Lucas, says the policy “has the potential to offer genuine social security to all while boosting entrepreneurialism”.

While no vote was taken on the policy, and it is unlikely to be made law any time soon, the motion raised the profile of the issue by enabling MPs to add their name in support.

And with ever increasing global interest in the idea, and basic income pilots set to spring into action all over Europe this year, perhaps it’s not as far away from becoming a reality in the UK as we may think.

Pilots

A number of cities and countries across Europe have committed to trialling a basic income.

Last year Finland announced a national basic income experiment, scheduled to start in 2017, which will be the EU’s first nation-wide project. It will see up to 100,000 Finnish citizens paid an unconditional income for a period of two years, after which the results will be analysed to see whether it should be rolled out nationally.

Trials have also begun in the Netherlands. The Dutch city of Utrecht will pay a small group of benefits claimants, whether they work or not, a basic income of £660 a month to provide a basic standard of living and help them avoid the ‘poverty trap’.

In Switzerland, a national referendum on a basic income is planned for this year, and support for the idea has also been reported in France and Canada.

While it is too early to tell whether these pilots will have the desired positive effect, the concept of a basic income is far from new and there have been signs of success from past experiments.

Positive outcomes

In the 1970s, a basic income social experiment, ‘Mincome’, was carried out in the Canadian town of Dauphin, which involved making payments to the entire population, relative to income to cover basic living costs. The programme succeeded in reducing poverty, improving health and alleviating other urban problems.

More recent basic income projects in developing countries have also helped alleviate poverty. In Namibia, a coalition of aid organisations trialled a basic income, funded through tax revenues, of 100 Namibian dollars to each citizen. The result: crime was reduced, children attended school and many villagers used the money to fund micro-enterprises. Meanwhile, in Uganda, a similar programme increased business assets by 57%, work hours by 17% and earnings by 38%.

Critics of such a system say that it would cost the state too much money, and would lead to welfare dependency and a reluctance to work, ultimately resulting in higher unemployment.

A recent survey undertaken in Switzerland would seem to refute this. It indicates that only a very small proportion of the population would stop working if they had a basic income and a majority believe that it would “relieve people from existential fears.”

Similarly, the Canadian experiment found no substantial difference in either female or male unemployment. There were changes in the labour market, as would be expected, with a reduction in working hours within families as a whole. Female spouses reduced their working hours to spend more time with children; and hours were reduced for adolescents within the family who entered the workforce later, suggesting that they were able to stay in education longer.

Way forward for the UK?

The Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA) has recently concluded that there is a strong practical case for basic income in the UK to replace the current tax and benefits system – “it underpins security, replaces the complexity of the current system, and provides a platform for freedom and creativity.”

The RSA report sets out a potential basic income model for the UK. It would provide a universal payment to every citizen, (with restrictions for migrants and those serving custodial sentences). A ‘basic’ amount paid to everyone of working age would provide incentives to work, therefore mitigating against low pay traps of the current system. It would also, the RSA report claims, mitigate against some of the negative distributive effects of basic income schemes by redistributing from higher earners to families with children.

The report calculates household income, comparing the proposed model with the current system of likely Universal Credit/National Living Wage income for 2020/21. In all instances, ranging from single parent families with children under or over five to couples with children under or over five, there was a gain for household income under the basic income model.

With the current welfare system and all its complexity, the new Universal Credit apparently not doing what it’s supposed to and the continued increase in job automation, is this really just a simple solution to a complex problem?

Perhaps by the end of 2016, there will be more evidence for the UK to seriously consider.

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Further reading: if you liked this blog post, you might also like:

Costs and benefits of the National Living Wage

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By Heather Cameron

Britain’s bosses have been urged by the government to prepare early for the introduction of the National Living Wage (NLW) in April next year.

Firms are advised to follow four simple steps:

  • know the correct rate of pay – £7.20 per hour for staff aged 25 and over
  • find out which staff are eligible for the new rate
  • update the company payroll in time for 1 April 2016
  • communicate the changes to staff as soon as possible

Support

This push coincides with a new poll revealing that 93% of bosses support the Living Wage initiative, with a majority believing it will boost productivity and retain staff.

This is supported by new research by the University of Strathclyde and the Living Wage Foundation (LWF), which uses real-life case studies and evidence from employees working for accredited Living Wage employers. It suggests that paying staff a living wage leads to many business benefits – such as staff retention, more efficient business processes, improved absenteeism and better staff performance.

Potential benefits

Many of the findings highlighted relate to research on the London Living Wage (LLW). Among these include:

  • 50.3% of employees receiving the LLW registered above average scores for psychological wellbeing, a sign of good morale, compared to just 33.9% of non-LLW employees studied
  • an average 25% reduction in staff turnover was reported for organisations moving to the LLW
  • and 70% of employers studied reported reputational benefits through increased consumer awareness of their commitment to being an ethical employer

Estimates show that 4.5 million employees will see a rise in their wages as a result of the introduction of the NLW in 2016, with a further 2.6 million gaining from spillovers. By 2020, 6 million employees are predicted to have received a pay increase.

Up to one in four workers are expected to experience a significant positive impact from the NLW. If the result is indeed a happier workforce, perhaps the knock-on effect for businesses will be improved productivity.

There will however be variation across different parts of the UK and across different households, depending on how the NLW interacts with the tax and benefit system (it should be noted that many estimates were made prior to the u-turn on welfare reform). And let’s not forget that the NLW is not for all as under-25s will not be eligible.

Costs to employers

The impact on employees and therefore employment generally, will also depend on the actions firms take to prepare for the NLW in order to mitigate costs.

Indeed, the research from Strathclyde and LWF recognises that implementing the NLW will inevitably involve initial costs to businesses and could represent an issue for some companies more than others.

According to the Federation for Small Businesses, a negative impact on business is expected by 38% of small employers, with many expected to slow their hiring and raise prices.

It has been estimated that the NLW may lead to an increase in the unemployment rate by 0.2% points in 2020; resulting in around 60,000 more people unemployed and total hours worked per week across the economy around 4 million lower.

Businesses may also look to employ those under the age of 25 who won’t be eligible for the NLW. This could particularly impact on those sectors with a high proportion of lower paid employees, such as social care – a sector that is already under financial pressure.

The roll out of the Living Wage has certainly raised concern over potential costs for councils, which are having to deal with increasing budget cuts. The Local Government Association (LGA) has estimated that the NLW could cost local authorities £1bn a year by 2020/21.

So while increasing wages for low paid workers may seem like a no-brainer in the bid to help reduce in-work poverty, the full impact on employees, employers and therefore the economy, remains uncertain. Only time will tell what the true impact of the NLW will be.

Further reading: if you liked this blog post, you might also want to read our previous blog on the Living Wage. 

Our popular Ask-a-Researcher enquiry service is one aspect of the Idox Information Service, which we provide to members in organisations across the UK to keep them informed on the latest research and evidence on public and social policy issues. To find out more on how to become a member, get in touch.

Follow us on Twitter to see what developments in policy and practice are interesting our research team.

The UK digital economy: how can the government support digital businesses?

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By Steven McGinty

Last month, the House of Commons Business, Innovation and Skills (BIS) Committee launched an inquiry into the UK’s digital economy. Iain Wright MP, the Chair of the Committee, explained that:

“Digital technology is rapidly changing the economic landscape in which firms operate. Nothing short of a digital and tech revolution is taking place, with new entrepreneurs and business models emerging and existing businesses having to adapt quickly to keep pace.”

The inquiry will focus on three areas:

  • Government actions affecting businesses in the digital economy;
  • how to maximise the opportunities and overcome challenges in the sector;
  • how the sector can contribute to improving national productivity.

The BIS Committee is asking for submissions from those involved in the digital economy, including digital businesses and companies hoping to benefit from technology.

 Why should the government support the digital economy?

Innovate UK expect that, by 2015, the UK digital economy will account for 10% of GDP. Tech City UK report that the sector employs 1.5 million people (about 7.5% of the total workforce); although this is expected to increase by 5.4% by 2020. In 2013-2014, 15% of all the companies formed were digital businesses. Most were based outside of London (74%) and nearly all were SMEs (98%). The majority (90%) of digital companies expect revenues to grow within the next year.

Technology clusters

Technology clusters play an important role in the UK’s digital economy. There are 21 clusters across the UK, with expertise ranging from software development to marketing and advertising. The majority of digital businesses consider themselves part of a cluster (65%). Bournemouth has the fastest growing digital cluster, with a 212% increase in the number of companies formed since 2010. Its specialism is digital marketing and advertising.

This growth suggests specific focus should be given to technology clusters. Tech City UK found that a third of digital companies highlighted access to funding as a challenge, particularly outside of London and the South East.  One suggestion offered by Tech City UK is that businesses need to take advantage of European funding where possible.

Other forms of support could include: providing fast and accessible broadband; access to a pool of skilled employees; suitable workspace, particularly in the South East; and business and mentoring advice.

Digital Economy Strategy 2015-2018

At the beginning of the year, Innovate UK set out a strategy to support UK businesses in getting the most out of digital technology. It sets out five main objectives:

  • Encouraging digital innovators
  • Focusing on the user
  • Equipping the digital innovator
  • Growing infrastructure, platforms and ecosystems
  • Ensuring sustainability.

Within the strategy, actions are put forward for how these goals will be achieved. For instance, to ensure sustainability, Innovate UK would work closely with UK research councils to encourage cross-disciplinary academic collaboration and help connect it to real-world business needs. If even some progress is made with each of these objectives it would be hugely beneficial for the UK digital economy.

Innovation centres – the Digital Catapult

The Digital Catapult is a national centre that aims to accelerate the UK’s best digital ideas to the marketplace, in order to create new products, services and jobs. It was established in 2014 by Innovate UK and is based in the Knowledge Quarter in Kings Cross. There are also three local centres in the North East and Tees Valley (NETV), Brighton, and Yorkshire.

The Digital Catapult centres focus on the challenges associated with: closed organisational data; personal data; creative content; and the internet of things (IoT). The centres are involved in a number of projects, including IoTUK, which has been launched as part of a £40 million government investment in the internet of things (the use of networks to allow the exchange and collection of data from everyday objects, such as fridges). The programme aims to increase the adoption of high quality IoT technologies and services throughout business and the public sector.

Regina Moran, CEO at Fujitsu UK&I, notes that:

“The IoT has the potential to turn ideas in a hyper-connected world into fully realised digital services but it has challenges ahead and it’s encouraging to see the Government investing in its development.”

 Regulation

The Prime Minister, David Cameron, has managed to convince the European Commission (EC) to review the VAT regime for tech start-ups, arguing that it punished British entrepreneurs. The regime, which was implemented in January, forced companies to pay tax in every country they traded in rather than their headquarters. It also eliminated a £81,000 threshold for which companies have to register for VAT duty.

However, the Commission has recognised that this was adversely affecting small businesses. Therefore, measures such as the reintroduction of the VAT threshold and a single registration scheme for cross-border taxes, will be included in the Commission’s consultation.

The UK government’s approach shows a commitment to providing a competitive business environment and a single European market in digital services. It’s likely that most digital businesses would support the government’s approach.

Concluding remarks

The upcoming BIS Committee inquiry will provide an opportunity to reflect on the government’s approach so far. Although evidence confirms that the digital economy has been growing, there may be areas that the UK is failing to capitalise on. In a highly competitive globalised economy, it’s important that the UK exploits any strategic advantage, ensuring that innovative ideas are brought to the market quickly.

The inquiry will also provide an opportunity for a dialogue between the government and the private sector. This increased collaboration can only be good news for the UK’s digital businesses.

Here at Idox, we take an active interest in the future of the digital economy and eagerly await the Committee’s findings.

Follow us on Twitter to see what developments in public and social policy are interesting our research team.

Enjoy this article? Read our other recent blogs relating to the digital economy:

IDOX Plc announced on 8 October 2015 that it had acquired the UK trading arm of Reading Room Ltd. Reading Room, founded in 1996, is a digital consultancy business with a focus on delivering websites and digital services that enable its customers to make critical shifts into digital business and client engagement. It has an international reputation for its award winning and innovative approaches to strategic consultancy, design, and technical delivery.

What’s driving the rise of food banks?

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By James Carson

In 2011, the Trussell Trust, a charity providing food aid across the UK was operating around 100 food banks. By the end of last year, that figure had risen to over 400.

The government standpoint

Food aid has become a divisive issue, largely because of disagreements about what’s behind the increased demand for emergency food aid. Last month, Priti Patel, employment minister at the Department for Work and Pensions (DWP) told the House of Commons that she did not accept claims by researchers that benefits sanctions could drive people to seek emergency food aid:

“There is no robust evidence that directly links sanctions and food bank use.”

Her contention is consistent with claims made under the coalition government. In February 2014, the Secretary of State for Work and Pensions, Iain Duncan Smith, suggested to the House of Commons that it was not welfare reform but greater awareness of food aid, that was increasing use of food aid:

“Food banks do a good service, but they have been much in the news. People know they are free. They know about them and they will ask social workers to refer them. It would be wrong to pretend that the mass of publicity has not also been a driver in their increased use.”

What does the research say?

The DWP position is at odds with research looking at food banks in an effort to explain their increasing use.

A 2014 report from the Child Poverty Action Group (CPAG) identified a number of factors driving people to use food banks. These include loss of earnings and changes in personal circumstances (such as bereavement and homelessness). But the report highlighted problems with benefits (notably delays and sanctions) as a significant factor causing people to seek emergency food aid.

In addition, first-hand accounts from those managing and working in food banks have strengthened the claim that there is a correlation between welfare reforms and increasing use of food banks.

In 2013, Ewan Gurr from the Trussell Trust told the Scottish Parliament’s Welfare Reform Committee that the number of people using food banks in Scotland had risen from 5,726 in 2011-12 to 14,318 in 2012-13. And he was unambiguous in identifying the main reason for this dramatic increase:

“We are seeing evidence every day, right across our food bank network, that welfare reforms are inextricably linked to the rise in demand for emergency food relief.

In December 2014, the Church of England published its report on food poverty in the UK.

While the report acknowledged that benefits sanctions do not always represent the sole reason claimants turn to food banks, it observed that reduction and delays in benefits has meant families living on low incomes are worse off in the long term:

“There is a clear moral case to address the shortcomings that exist in our welfare system.”

The human impact

The impact of food poverty can be seen in the human stories that are often forgotten in the cut and thrust of the public debate. In March this year, a report highlighted the experiences of people around the UK trying to survive on very low incomes.

In one instance, a 57 year-old man’s benefits had been cut for 13 weeks because he failed to complete enough job applications.

“William came to the food bank in the first week of his sanction. He was given food and didn’t return until weeks 11 and 12. William was apologetic for having to come back again, but said that his tea, sugar and other basics had now run out. We spoke to him, to find out how he’d managed. He said he’d cut down on the amount he ate, and that the mild winter meant he had managed without heating.”

For those of us who thought food poverty was a bitter memory of a bygone era, the very existence of food banks is hard to stomach.  As the Scottish Parliament’s Welfare Reform Committee concluded:

“They are a sign of a Dickensian model of welfare which should have no place in a prosperous nation. Ultimately the necessity for food banks should be eliminated.”

With the exponential growth of food banks across the country, that aspiration is unlikely to be realised any time soon.

The Idox Information Service can give you access to a wealth of further information on poverty and social exclusion – to find out more on how to become a member, contact us.

Further reading*

How can households eat in austerity? Challenges for social policy in the UK, IN Social Policy and Society

Food bank provision for families in North Nottinghamshire

A survey of food bank operations in five Canadian cities, IN BMC Public Health

The increasing demand for emergency food aid in the UK (SPICe briefing 14/46)

Below the breadline: the relentless rise of food poverty in Britain

*Some resources may only be available to members of the Idox Information Service