Category Archives: Economic

Britain, Economic, Government, Politics, Society

UK Government Policy is anti-family

SOCIETY

THE Observer’s editorial, on Sunday January 15, the sister newspaper of the Guardian, concerns how hostile the UK has become in families having children. The editor points to how parents are being forced to bring up their offspring in conditions that will have grave repercussions for society.

According to the old proverb, ‘It takes a village to raise a child.’ That will have little meaning for many parents today, but the proper place for institutions outside the family in the birth and upbringing of our children is a pressing matter indeed. Recent evidence suggests that government is grievously failing parents in many ways.

Alarmingly, it starts even before birth. A report released last week from the Care Quality Commission (CQC), highlighted a worrying decline in women’s experiences of NHS maternity services in England. The trend comes in the wake of several inquiries into the very poor maternity care on offer in some hospital trusts, with more than 1,000 babies dying or who are left with severe injuries each year as a result of something having gone wrong during labour. The CQC has found four in ten maternity services are providing unacceptable levels of care. This goes well beyond the general resourcing and staffing issues within the NHS that have created a national crisis; it reflects more directly a cultural under-prioritisation of the care of women and their babies that has not been adequately addressed by successive UK governments.

Government policy, too, has a marked influence on the context within which parents bring up their children: the expense in having a child, the level of support on offer when things go wrong, and the difficulties of juggling childcare with maintaining a career. Political decisions made over the last decade has, undoubtedly, resulted in Britain becoming a more hostile place to bring up a family.

The cost-of-living crisis has pushed up the already high cost of raising a child to the age of 18 even further. An estimate provided by the Child Poverty Action suggest the average figure is now £160,000 for couples and £200,000 for lone parents. Even if both parents work full-time at the minimum wage, it is forecast they will fall more than £1,700 a year short of the income needed to attain a basic minimum standard of living. This reflects the fact that as wages have stagnated over the last decade, the cost of living – including housing, food and energy – has increased, and government support for low-paid parents has been significantly scaled back since 2010 through austerity.

Successive Conservative chancellors have reduced tax credits and benefits for low-income families with children while introducing generous tax cuts that have benefited the better off: a redistribution not just from the less to the more affluent, but from families with children to those without. This has undermined the financial safety net that was put in place for families by the last Labour government. It was a provision in recognition of the fact that Britain has too many jobs that simply do not pay enough for parents to be able to provide for their children. It should come as no surprise, then, that child poverty rates have risen since 2010, with almost one in three children in the UK living in poverty.

Long-term issues in the housing market have also introduced much greater uncertainty in relation to raising children. Rising house prices mean more parents will never be able to afford to buy their own home: one in five households now live in privately rented accommodation, up from one in 10, 20 years ago. This trend will continue to rise, with more children being brought up in rented homes. This not only has a huge impact on living standards – Britain has the most expensive rents in Europe – but on safety and security. More than a quarter of homes in the private rented sector do not meet the government’s minimum “decent homes” criteria. Also, a vast number of renters remain vulnerable to short-term tenancy agreements, at the end of which they can be evicted through no fault of their own. The law in England, in particular, has much to do to protect tenants from the uncertainties they face. The growing numbers of parents who rent property deserve to be able to achieve much greater stability for their children through controlled rents and long-term tenancies.

The other pressing factor for parents is childcare, a huge financial outlay, particularly for young children not yet at school. Recently released data shows that Britain now has the joint-highest childcare costs of any OECD country. Government support with these costs is generally erratic and it is harder still to access quality nursery provision in the least affluent areas. Yet, as studies have shown, high-quality childcare provision is associated with better educational outcomes, particularly for children from disadvantaged backgrounds, higher levels of parental wellbeing and better economic outcomes for women. Modelling by the Institute for Public Policy Research (IPPR) suggests that investing in universal free childcare for the under-fives would boost economic growth and result in a higher tax take.

The anti-family sheen of government policy and neglect mean that many parents cannot give their children the level of security they aspire to, affecting the rest of their lives. It will also put some people off having children, with wider consequences for the whole of society given the higher tax burden that Britain’s low birth rate will impose on future generations.

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Economic, Government, Politics, Society

Reducing income inequality

INCOME DISPARITIES

Intro: Most people agree that income inequality is too extreme and that it needs to be reduced. But by how much?

INEQUALITY remains a major political issue in the world today. Most people agree that inequality is too extreme and needs to be reduced.

In the UK, the income ratio between the richest 0.01 per cent and minimum-wage workers has reached around 150 to one. Within the FTSE 100 firms, pay ratios between CEOs and lower paid workers hover at about 100 to one. Similar inequalities prevail in many other countries, while in the United States the figures are much worse, with pay ratios and disparities sometimes reaching into the thousands.

There is nothing natural or inevitable about extreme inequality. It is the predictable result of an economic system that distributes income based on who owns the means of production and who has the most market power, rather than according to any common-sense principle of labour contribution, human needs or justice.

Inequality corrodes society and poisons democracy, but it is also ecologically dangerous. The wealthiest in society consume an extraordinary amount of energy, resulting in high emissions and making decarbonisation more difficult to achieve. Recent research by Joel Millward-Hopkins published in Nature Communications shows that if we want to ensure decent lives for everyone on the planet, and by decarbonising quickly enough to feasibly achieve the Paris Agreement goals on the climate, we will need to dramatically reduce the purchasing power of the rich, while distributing resources more equitably.

But how much should inequality be reduced? What is an appropriate level of inequality? Millward-Hopkins’ research shows that if we are to ensure that everyone has access to resources necessary for a decent living, then a distribution where the richest consume at most around six times that level would be compatible with achieving climate stability. This may sound radical, but this distribution is very close to what people around the world say is a “fair” level of inequality. In some countries – such as Argentina, Norway and Turkey – people say they want inequality to be even lower, with ratios less than four to one.

People want to live in a society that is fair. This is apparent when we look at public sector pay scales, the closest thing we have to a democratically determined distribution. In major British institutions like the National Health Service (NHS) and within the universities, where unions representing members have a say over pay scales, the gaps between the highest and lowest salary bands rarely exceed five to one. If we correct for career-stage, the gaps are much smaller: the starting salary for a doctor or a lecturer is only about twice as high as that of a cleaner.  

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Britain, Economic, Energy, Environment, Government, Society

The looming crisis of an energy shortage

ENERGY RESERVES

NEVER in history have modern societies relied so heavily on secure supplies of electricity. Half a century ago, when the nation was last subjected to major power cuts, the effect was mainly on heating and lighting.

Now, however, the computer revolution has changed that completely.

People shop online, we work online, and much study is also done online. International trade and financial transactions depend entirely on a functioning computer network.

The same is true of everything from the police to the transport system. And a power shutdown or outage of only a few hours, even if scheduled, could do lasting damage.

In the same period, we have grown accustomed to a more or less regular and reliable power supply.

Thanks partly to investments made decades ago, the country still has a significant amount of reliable nuclear-generated electricity, plus a small, dwindling reserve of coal generation.

But both these sources are shrinking, because we have phased out coal for a greener environment and because we have failed to plan effectively to replace ageing nuclear plants. A great deal of our remaining energy now depends on gas, much of it imported.

The revolutionary switch to renewable energy, made in response to global warming and the climate change crisis, has been for some years the main focus of planning and building.

This is excellent when it works, but it is completely dependent on the caprice of weather, or on the simple realities of climate.

Solar power, predictably, is of little use here in winter. Wind power can vanish without warning or can be made unusable because the wind is actually too strong for safe generation. Proud announcements that the country has generated 50 per cent of its power through wind on any given day should be greeted with caution. On a windless day, that figure could be tiny.

Some of these problems are alleviated, but not solved, by connectors from our neighbours.

These can rescue us at awkward moments, but France, for instance, has run into major maintenance problems with its elderly nuclear generators, and winter weather simply increases pressure on scarce resources, everywhere. Up to a point, sudden shortages may be dealt with by paying large consumers to switch off, or by bringing in banks of costly and far-from-green diesel generators.

But the risk of actual power cuts, especially in weather such as we have recently been experiencing, is worryingly high.

We really are not very far away from imposed power cuts in our homes and offices, which – as well as leaving the old and vulnerable in the cold and the dark – will do serious damage to the economy.

So, it is perplexing to find that the Government has been relying on predictions by the Met Office in making its plans and calculations. Not only is the Met Office honest about the difficulty of long-distance forecasting, but winters in the UK can be very severe indeed.

Who knows what we would do if Britain once again faced a relentless long-term freeze such as that of 1962-63, itself the coldest since that of 1895?

Events such as the “Troll of Trondheim” often come with little warning. So do interruptions in supply, hugely important now we are no longer self-sufficient in gas.

The one thing that the Government can do is to be prepared for all eventualities. It has been many months since the poor state of our reserve capacity was revealed.  Let us hope that Ministers and officials have not wasted a single second in getting ready.

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