Good morning from New Economy Brief.
This week’s newsletter examines the politics of the cost of living by exploring new polling from Stop the Squeeze that takes an in-depth look into how voters are processing the policy debates around it, and how important the issue will be to the forthcoming general election.
The cost of living crisis will swing the next general election. As the summer ends, political parties are gearing up for an impending general election. We may not know exactly when it will happen, but the issues it will be fought on are becoming clearer. The Bottom Line: How Bold Action on the Cost of Living is Key to the Next Election, a new report from the steering group of Stop the Squeeze (a coalition of 50 civil society organisations campaigning for structural solutions to the cost of living crisis), sheds new light on a crucial one. The report sets out to discover what voters, and especially key swing voters, are hearing from the parties, how they are responding, and the kinds of messages and policies on the cost of living crisis that might sway them in 2024.
How to win over swing voters on the cost of living. The voter group dubbed 'Stevenage Woman’ (or ‘Disillusioned Suburbans’) by the think tank Labour Together will be particularly important in the next election. Representing 21.8% of the electorate in England and Wales, these voters are particularly well represented in the East of England, in London’s suburbs, and in the North East and West. They are young, economically insecure, worried about their finances, and unlikely to own their own homes. They are not highly politicised, but are generally socially conservative while leaning left on the economy. How this group votes will decide which party wins the next general election. As Labour Together say: “A working majority depends on Labour’s ability to convert their current support amongst Disillusioned Suburbans into votes at an election.” So how can political parties win over these crucial voters?
The political opportunity for all parties. The report suggests that a party that is willing to make a bigger offer on the cost of living, focused on areas the public care about such as energy bills and housing costs, and funded by taxation of wealth, could reap the rewards with voters who are desperate for government action that could really improve their lives.
The care chasm. A new report by think tank Autonomy predicts that the over 70s population will grow more than twice as fast as the number of care workers – leading to a worrying gap in care needs. It estimates that between now and 2035, there will be a 0.87% year-on-year increase in the number of care workers, while the population of over 70s will grow 2% year on year.
Public service funding by local authority. A new tool created by the Institute for Fiscal Studies (IFS) think tank explores how much funding different areas of England receive for key public services, and whether this distribution of funding is in line with patterns of needs. The IFS argues that while NHS funding “appears to be relatively well-targeted to estimated needs”, “local government funding is much less well-targeted towards estimated needs, with only 39 areas out of 150 receiving a share of funding that is within 5% of their share of estimated spending needs.”
Climate Justice Map. The Climate Justice - Just Transition (CJJT) Donor Collaborative has launched a new ‘Climate Justice Map’, mapping over 1,600 organisations working for climate justice and a just transition with an emphasis on groups based in the Global South. The map explores ‘climate justice champions’ across over 150 countries.
Happy Birthday, Inflation Reduction Act. This month marks one year since the US passed the Inflation Reduction Act (IRA). In Labour List, Common Wealth’s Melanie Brusseler argues that “the urgent political project of implementing the IRA offers lessons for necessary state-led transition programmes,” particularly for the UK Labour Party. “Labour should learn from early issues in implementing the IRA and be ambitious, and focused on building a strong institution, in its proposed public renewable generation company Great British Energy,” writes Brusseler.
A national investment fund for green growth. The Institute for Public Policy Research (IPPR) has proposed establishing a national investment fund (NIF) to harness “one of the most important economic opportunities of the 21st century”: green growth. The IPPR argues that the NIF should operate alongside existing policy tools such as state investment banks and provide “equity and equity-like (convertible loans) financing to companies willing to expand production in green manufacturing activities and to decarbonise heavy industry processes”.
Essentials guarantee. Universal Credit is falling so far short of the cost of essentials that it is putting the health of millions at risk, according to a letter to the Prime Minister signed by 32 charities and medical organisations including the British Medical Association, the Royal College of Nursing, Age UK and the Joseph Rowntree Foundation. The letter calls for an ‘Essentials Guarantee’: a new law to make sure Universal Credit’s basic rate is always at least enough for people to afford the essentials.
Labour’s fiscal rules. In a letter coordinated by Compassion in Politics, top economists including Professor Ha-Joon Chang and The Spirit Level authors Professor Kate Pickett and Professor Richard Wilkinson warn that Labour’s ‘fiscal rules’ risk deepening “the poverty and hardship many are already facing”. The economists encourage the Labour Party to move “from an out of date, economically and socially destructive approach towards a model which improves wellbeing, works in alignment with our environment, and achieves social justice”.