Under the Public Sector Equality Duty, public bodies are required to have 'due regard' to gender and other types of equality. Many organisations concerned with equalities argue that this requires public bodies to undertake equality impact assessments (EIAs) to ensure that policy does not discriminate against women, ethnic minorities and other groups protected under the 2010 Equality Act.
Many economists have argued that assessments of policy from government, as well as the media, should be based on a broader account of economic and social progress. This means targeting the reduction of inequalities as well as focussing on GDP growth. 'Gender budgeting', analysing government spending and tax decisions in terms of their impact on women, is one such approach.
The Women's Budget Group sets out how Equality Impact Assessments can ensure that policy makers take account of the different impacts of policy on women. Meaningful equality impact assessments should consider cumulative impact, intersectional impact (for example on women of colour and disabled women), the impact on individuals as well as households, impact over a lifetime and the impact on unpaid care.
The Women’s Budget Group has curated a set of resources on gender budgeting, the analysis of tax and spending decisions from a gender perspective. It argues that this approach can also be applied to other types of inequality.
The Fawcett Society has proposed a new Equal Pay Bill which would modernise UK law on equal pay. The Bill would give women who suspect they are not getting equal pay the ‘Right to Know’ what a male colleague doing the same work is paid, thereby enabling women to resolve equal pay issues without having to go to court.
To meet housing demand an estimated 345,000 new homes are needed per year in England alone. The level of housebuilding has increased in recent years but is still far below this level.
It is widely argued that a core problem is the UK's developer-led model of housebuilding. Private developers compete for land and then 'bank' it, waiting until they believe they will make the most profit from increases in land values and from building homes. This causes significant delays and helps push up costs.
It also reflects the broader transformation of housing and the land it sits on into a financial asset. Over recent decades the public policy preference for private home ownership has been accompanied by the liberalisation of bank credit and accompanying financial innovation. Under these conditions, land and property have become both the most attractive form of collateral for the banking system and the most desirable form of financial asset for households and investors.
While some criticise the planning system for slowing development, the data doesn’t support this: 88% of new housing planning applications are granted. Local authorities are key to building more homes: the UK has never delivered homebuilding at the required scale without major locally-led public projects. Local authorities are under-resourced and often lack access to affordable land. They are also under significant pressure to sell off land they already own to balance their budgets.
The Resolution Foundation’s Intergenerational Commission examined how to tackle the housing crisis faced by young people. It calls for reform of the private rented sector, end the 'help to buy' scheme which raises housing demand, the reform of property taxes including stamp duty, and greater funding for local authorities to build homes.
Rethinking the Economics of Land and Housing by Josh Ryan-Collins, Toby Lloyd and Laurie Macfarlane explores the relationship between the financial system, housing and land; it is summarised in this review for the LSE Review of Books. Noting how mainstream economics largely ignores the role of land, the authors show how land and housing have become key financial assets, and how wealth inequality is driven by housing and land ownership. Their policy recommendations include a Land Value Tax.
The New Economics Foundation explores the role of banks and the financial system, supported by government policies, in fuelling house price growth – with housing wealth now making up almost half of total household assets. In a separate report they argue that the housing crisis will only be solved if what they describe as 'the broken land market' is tackled.
Arguing that the 'broken land market' has played a key role in the financialisation of the UK economy and its poor productivity record and that high house prices have fed macroeconomic instability, IPPR call for a range of reforms. These include a housing price inflation target for the Bank of England, reform of compulsory purchase laws to allow local authorities to buy land at fair value, a requirement for new housing developments to include a minimum proportion of affordable housing, an annual property tax to replace council tax and a land value tax to replace business rates.
It is now widely expected that the International Monetary Fund (IMF) will create $650 billion in new international money to help low-income countries recover out of the pandemic. So-called ‘Special Drawing Rights’ or SDRs (which countries can draw on from the IMF) could help support both vaccination and health care programmes and infrastructure investment – particularly in green projects and ‘nature-based solutions’ – in the global South.
Under current IMF rules SDRs mainly go to richer countries (including China), so this programme will require them to ‘donate’ their allocations back to the IMF to reallocate to poorer ones, particularly in Africa. Many people are now arguing that this redistribution should be written into the IMF’s rules to ensure it is permanent. Others are calling for a larger SDR issuance as part of stronger support for a global green and resilient recovery.
Explaining how the current allocation rules for SDRs provide very little for Africa, Hannah Wanjie Ryder and Gyude Moore propose that at least 25% of the new SDRs should be put into a special fund controlled by low-income countries and allocated on the basis of need (paywalled).
Lara Merling of the International Trade Union Confederation called upon the IMF to issue special drawing rights to “stave off a debt crisis in developing countries as well as ensure countries are able to afford items of vital importance such as personal protective equipment, vaccines, medicine, and food”.
The Center for Global Development explains how SDR rules could be changed so that the funds can be more effectively targeted to where they are most needed for development.
Eurodad argues that the proposed $650 billion issuance of SDRs is too small to properly support low-income and indebted countries, and argues for a $3 trillion package.
The two main provisions for children in the social security system are Child Benefit and the child element of Universal Credit (or child tax credits in the legacy benefits system). Child Benefit is provided for all children, although there is a reduced effective rate for children after the eldest, and for families with one or more higher income earners (over £50,000 p.a.).
Means-tested support for families through Universal Credit or child tax credits is largely limited to two children. This aspect of child support has faced particular criticism for penalising children born into larger families. Nearly half (47%) of children in families with three or more children live in poverty.
Overall there were around 3.4 million children living in poverty in 2019-20. Nearly half (46%) of all children from black and minority ethnic groups are in poverty, compared with a quarter (26%) of children in white British families. 75% of children growing up in poverty live in a household where at least one person works.
Good affordable childcare enables parents to work and provides early years learning. But only a little over half (57%) of local authorities in England have enough childcare places for parents who work full-time, and less than a quarter (22%) have sufficient for those who work atypical hours.
The Child Poverty Action Group’s research on 'the cost of a child' shows that two parents working full-time on the minimum wage will still be £47 a week short of the income they need to raise a child. It wants the child element in Universal Credit restored, child benefit increased by at least £5 a week and both the two child limit and overall benefit cap abolished.
IPPR and the TUC make the case for a “family stimulus”. They show that increasing the child element of Universal Credit (UC) and child tax credit (CTC) by £20 per week per child and removing the two-child limit would increase GDP by 0.5% (£14 billion a year) and lift 700,000 children out of poverty. They also propose an increase in childcare spending.
The Women's Budget Group explains the current landscape of childcare and childcare support in England. The TUC analysed the cost of childcare prior to the pandemic. It found that childcare fees rose three times faster than wages; for lone parents, seven times. In a 2021 survey of 20,000 parents in the UK coordinated by Mumsnet, 97% felt childcare was "too expensive", and a third said they paid more for childcare than their rent or mortgage.
The Coram Family and Childcare Trust argues for universal availability of affordable childcare for all children, including school age children. It argues that the cost of childcare must be such that every parent is better off working after childcare costs; there must be good child care available for disabled children and those with special needs; and the value ofchildcare professionals should be recognised through pay, professional development and representation.
Social infrastructure is the term now commonly given to those sectors of the economy - health, education, adult social care and childcare - which are critical for its effective functioning but which are often neglected in both economic theory and policy. Spending on social systems is rarely classed as ‘investment’, despite the investment-like returns in these areas. It can be argued that this reflects a gender bias in economic policy making.
The majority of jobs in social infrastructure sectors are held by women, and many of them by people of colour. Pay is often very low. Investment in these sectors could therefore help to reduce both gender and racial inequalities. Social infrastructure sectors are also 'green', using less energy and material resources than many other sectors, particularly physical infrastructure.
Improved access to affordable childcare is a critical part of social infrastructure provision, giving parents, particularly women, the ability to take up and stay in paid work.
Analysis by the Women’s Budget Group estimates that investing in care as part of an economic stimulus package would provide almost three times as many jobs as the equivalent investment in construction. It would narrow gender inequality and also have positive environmental impact.
The Greater Manchester Independent Prosperity Review argues that investment in physical infrastructure alone will not narrow the UK’s unusually pronounced regional inequalities, emphasising the need for social infrastructure spending.
Coram Family and Childcare argues that four key goals should inform childcare policy: making sure every parent is better off working after childcare costs; making sure there is enough high quality childcare for all children, including those of school age; making sure children with special education needs or disabilities can access high quality childcare; and recognising the value of childcare professionals through pay, professional development and representation.
While the 2008 financial crisis centred on the banking sector, the Covid-19 crisis has shown that there are huge vulnerabilities in other parts of the financial system – often referred to as the shadow banking system. Shadow banking entities offer services that are similar to those provided by commercial banks but are not regulated in the same way. They include some investment banks, mortgage companies and firms that deal with securities.
This lack of regulation means that shadow banking contains the most immediate risks to financial stability as a result of the economic downturn, as a result of poor regulation for the last decade. Some argue that particularly systemically important non-bank financial institutions – such as insurance companies or other institutions that might be seen as too big to fail – must also be protected and regulated to protect the integrity of the financial system as a whole.
Professor Enrico Perotti argues in a column for Vox EU that the coronavirus shock poses a serious liquidity risk for the shadow banking sector and that support to this part of the financial system is critical.
The Financial Times editorial board has argued that policymakers were right to introduce regulation that began to shift risk from banks to non-bank financial institutions, and that investors should be prepared to lose their capital during this crisis.
Mark Sobel, chairman of the US Official Monetary and Financial Institutions Forum, recommends that policymakers undertake a review into the shadow banking sector when this crisis is over to determine what went wrong and what fixes are needed. He identifies several failures in regulating this sector and that financial stability is under threat.
There has been a Development Bank of Wales since 2017, and a Scottish National Investment Bank was launched in late 2020, supported by £2 billion of public funding over its first ten years.
The bank's mandate is to finance investment to realise Scottish economic priorities, including a greener economy. Some claim its mandate is not tight enough and it should be more deliberately focused on helping Scotland respond to environmental breakdown and supporting ethical investment.
UCL Institute for Innovation and Public Purpose sets out a framework for a mission-focused Scottish National Investment Bank. This maps different potential national missions such as decarbonisation to the sectors and solutions that are most in need. It also recommends meaningful public participation in deciding these missions, and for specific, measurable targets to judge whether they are being delivered.
Friends of the Earth Scotland and others have campaigned to secure a more specific set of ethical investment criteria and low-carbon purpose to the Scottish National Investment Bank.
The UK is one of the most geographically unequal countries in the industrialised world. Large disparities in wealth, opportunities and health exist within and between regions. Longstanding areas of urban deprivation have the highest levels of unemployment.
Compared to many other countries, local areas lack wide-ranging powers and resources. National decisions from the recent past, most notably austerity, have further undermined the ability of people and places to shape their own resilient economic future. Between 2010 and 2018, local authorities have seen 24% cuts to their funding with cuts falling disproportionately on councils in more deprived areas. Many of the bodies that do exist, such as Local Enterprise Partnerships, are criticised as undemocratic, under resourced and lacking the appropriate powers to make effective change.
Giving greater power to local authorities and communities is not just about reversing past cuts. Two leading ideas are to reform and reinvigorate local and regional governance, including through greater devolution within England; and for local leaders to pioneer Community Wealth Building, economic strategies that seek to keep as much wealth as possible circulating around the local economy.
The Young Foundation suggests that previous economic strategies that attempted to use growth in London as a way to reap rewards for all other places has failed. They point to public, charitable and philanthropic funding being very low in areas that are more likely to have voted to leave the EU.
The Equality Trust explores the significant economic divides within as well as between regions. In particular they point out the inequality within London, where the capital has the largest gap of all regions between the richest and the poorest 1%.
The Women�۪s Budget Group reveals that while cuts to local government funding have had wide and deep implications for all, the impact of cuts is particularly felt by women and girls, particularly those who are disabled or from BME backgrounds.
The Centre for Local Economic Strategies and the Democracy Collaborative suggest that the economic shock of Covid should be an inflection point for a new approach to local economic development. They describe community wealth building as a new ���common sense�۪ after the pandemic has connected people with the importance of community.
Rapid and sustained action is now needed if we are to avoid the very worst outcomes of the environmental emergency. Carbon emissions, including those of the UK, are not falling rapidly enough and sufficient action is not being taken to tackle other environmental destruction.
The UK aims to be a world leader and has committed to net zero emissions by 2050, offsetting any remaining emissions. Some still consider this deadline too far away.
The COP26 UN climate talks will be hosted by the UK in 2021. These crucial talks will determine whether countries' climate plans will keep the world on track to limit heating to 1.5 degrees celsius. Wealthier nations must also agree on how to unlock more financial support for poorer countries. More green investment is needed as investors continue to fund polluting industries.
The Global Biodiversity Outlook report from the UN Convention on Biological Diversity warns that biodiversity is declining at an unprecedented rate. The report notes that it is not yet too late to slow, halt and reverse the trend.
An annual progress report by the official watchdog the Committee on Climate Change (CCC) argued that in only 4 of 21 key areas for decarbonisation has the UK government implemented policies of sufficient ambition to achieve its own statutory carbon budgets.
The United Nations Environment Programme Emissions Gap Report gives the latest update on the trajectory of greenhouse gas emissions and warns that nations will have to reduce emissions by more than 7.5% per year over the coming decade.
The Energy and Climate Intelligence Unit has a Net Zero Tracker that keeps track of which nations have signed up to reduce emissions to net zero.
