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A Question of Growth

July 28th, 2016

This blog is written by Ben Jupp, a director at Social Finance, and is the fifth in our “A Question of Growth” series. Over the next few weeks we will be posting a new piece every Tuesday and Thursday. You can read all of the previous blogs in this series here.

 

By many assessments, persistent poor health has a more negative impact on people’s wellbeing than any other factor. Unemployment is the second most detrimental.

For those suffering ill-heath and lacking a job, the consequences can be incredibly damaging for them as individuals and for our economy. The challenges often reinforce each other, with poor health making it difficult to get a job, whilst recovery from mental and some physical illnesses often hampered by unemployment.

Despite the severity of these problems, as a society and economic system our recent track record in addressing them is lamentable – those out of the labour market for long periods of time are now typically have a physical or mental health condition. For those with mental health conditions, for example, surveys indicate that between seven and nine out of ten wish to be employment. Yet only around four in ten are currently in work, and among those with a severe mental illness the proportion drops to fewer than one in ten. All told, nearly 5 million people of working age with a long term health condition or disability are not in employment. The proportion rises considerably once people are in their fifties and early sixties.

Collectively, these very difficult individual circumstances now represent a major drag on our economy and the government’s fiscal health. The Department of Work and Pensions estimate, for example, that GDP would grow by around 1% if people could typically work an extra year before retirement. For those out of work, the cost to government of lost taxes and increased welfare payments frequently exceeded £10,000 each year.

As economic uncertainty threatens growth over the coming years, this is one area where earlier action could play a major role to support growth as well as improvements in individual wellbeing.

To good news is that Britain can do much better than recently. For example, we currently languish towards the bottom of the league of developed countries in regard to the employment of people with mental health conditions. Likewise, although retirement ages are rising, we estimate that there are still around 700,000 people who are involuntary retired due to ill health or a disability.

So how could government, employers and civil society start to turn this position around?

Over the last two decades there have been plenty of examples of what not to do, and also some positive approaches to build upon.

The current flagship employment support programme – the Work Programme – has had relatively little success for those with significant health conditions and disabilities. The reasons are various, but typically include: insufficient resources to help people with greatest needs; delays and barriers in receiving appropriate support; and a lack of understanding about the support needs of those with health conditions by some ‘generic’ employment advisors and a lack of trust between recipients and providers of employment support.

We believe that there are much better approaches available.

At the heart of a better model for helping people re-enter and sustain work needs to be the relationships which people already have with the health service and their employers. These represent the foundations of trust and understanding which can allow people to receive the support and encouragement they need. Another central principle should be to help people to fulfil their desires and potential, rather than forcing them into jobs which they do not want.

A great example of applying these two principles is an approach to helping those with severe mental health conditions called Individual Placement and Support. Individual Placement and Support provides integrated employment support as part of people’s recovery from mental ill-health. It starts with people’s wishes: it is always a voluntary programme which seeks to quickly get them into a real, paid job of their choice, rather than squeezing them into any job or a ‘make work’ scheme. It uses employment advisers who are integrated with the rest of the mental health team supporting people’s recovery. It has sufficient resources to allow people to be supported once they enter employment rather than just pushing them into a job and then abandoning them.

In Britain, and around the world, that this approach is now demonstrating impact for those with severe mental illness. Two weeks ago, for example, I was talking to the leader of an Individual Placement and Support service attached to one of the large London mental health trusts. Of 500 referred to the service last year, 270 found a job. Randomised Control Trials also indicate that it is far more effective than more traditional models of employment support for these groups. That is why Health and Employment Partnerships – a new social organisation dedicated to helping those with health conditions improve their wellbeing through fulfilling, sustained employment – is backing the growth of Individual Placement and Support in three areas.

More broadly, the principles of Individual Placement and Support can be applied much more widely than to those with a severe mental health condition. For example, employment support and social care support could be better integrated for many people with learning disabilities. Those with more moderate mental and physical health conditions may benefit from more integrated primary care and employment support.

For those approaching the later stages of their career, and who are beginning to be held back by health conditions, it is important to act before they leave the labour market. Relationships with employers are crucial to this, enabling people manage moves to less physically demanding roles either within or beyond their current organisation. Just relying on employers is not, however, always going to be sufficient. It may be important to draw on the relationships people with the health service, or separately funded support, to build a plan which meets their aspirations for older age and allows them to keep working.

Over the last year, there have been positive signs that government is better recognising this need for more integrated and personalised employment support for those with health conditions. The recent five year mental health strategy announced £100 million for employment programmes including expanding Individual Placement and Support. Employment programmes are being developed to give more of a focus to health more generally. A new central government Health and Work Unit is supporting innovation and learning. This is being matched by strong interest for new models by new ‘city-region’ combined authorities with devolved powers such as Greater Manchester and the West Midlands.

Yet we should not underestimate the further changes which will be required to stimulate a fundamental shift in the employment of those with health conditions. Cultures in both employment and health services will need to evolve significantly. Funding flows and incentives will need to be realigned. Obligations on employers will need to be reconsidered. As we look to develop an early action economy and society, in my mind there is no more pressing an issue around which central government, local services, professions, business and civil society need to come together.

Ben Jupp is a member of the Early Action Taskforce. He is a director at Social Finance and Chair of Health and Employment Partnerships. He was previously Director of Public Services Strategy and Innovation in the Cabinet Office.

 

A Question of Growth

July 26th, 2016

This blog is written by Professor Anne Power, Head of LSE Housing and Communities, and is the fourth in our “A Question of Growth” series. Over the next few weeks we will be posting a new piece every Tuesday and Thursday. You can read all of the previous blogs in this series here.

 

Growth takes many forms and we can see evidence of growth all around us. Population growth shows up in migration streams from countries with fast growing populations, devastating environmental pressures and extreme low incomes. This growth challenges governments whilst simultaneously bringing new opportunities for growth.

The explosive growth of technology threatens many existing but it can also help solve some of our most challenging problems, for example by helping save energy through smart grids, advanced battery storage and many other high-tech devices.

Traffic growth is a clear example of hard-to-manage and climate change-inducing growth, turning congestion, air pollution, health hazards, noise impact and even travel itself into serious threats to our survival. Yet without mobility the modern economy of cities simply wouldn’t function.

There are other examples. Almost all plant growth is good as it absorbs carbon dioxide, provides the world with oxygen, top soil, fuel, building materials and is 100% renewable. Growth can help.

At the same time, growth in resources which we need to tackle serious social problems no longer seems likely, partly because of slower economic growth. We often misunderstand the link between economic growth and resources to tackle problems. We need growth in order to raise taxes to fund more benign activity, more long-term investment. In other words, early action to prevent problems depends on growth and is itself a growth generator.

Early action confronts problems before they become chronic or even intractable. Crime prevention instead of prison and recidivism is a good example. But funds are being cut for youth work, adventure playgrounds, holiday programmes, and further education for those left behind at school. All of these early action investments help to reduce crime and anti-social behaviour. So we need the kind of growth that favours a long-term early action view of problem solving – help a young person now and for the next ten years and they are more likely to find work, create a stable family, and fend for themselves. This is a great investment in long-term growth through early action. The Harlem Children’s Zone works because it helps from cradle through college to parenting and onwards.

Many economists, social thinkers, environmentalists, religious leaders and politicians have applied their minds to the growth dilemma, balancing longer-term against shorter-term, prevention or cure. Will Hutton, in his recent book on how to secure growth that is benign, argues for a longer-term, more “stakeholder” approach to business investment and growth to balance our social and environmental needs with economic growth. Beneficial growth cannot be measured in profit and Gross Value Added alone nor are they the best drivers of human progress, though they have their place. We need a more shared and longer-term stake in the future. It is the longer term that motivates investors and businesses to work for a wider goal than maximising personal worth.

Catholic social teaching has become strangely fashionable in debates about business, growth and profit. A radical view of the sharing economy emerged from the blatant injustices of the Industrial Revolution and the exploitation of workers and their families for naked profit. The idea of a just wage, of workers having a stake in the enterprise they work for through unions, , of enterprises doing good while making money, is now deeply embedded in the economic structures of many organisations throughout Europe. Nationwide Building Society, a mutually owned big bank, and John Lewis Partnership, effectively a worker-owned company, are two examples. This idea is not anti-growth but pro-beneficial growth.

Nicholas Stern, one of our most influential environmental economists, argues that:
a) The risk of serious climate change with potentially catastrophic consequences for poorer communities around the globe is so significant that not taking early action is little short of reckless;
b) The economic cost of inaction is vastly greater than the cost of converting our whole economy to sustainable investment in renewable energy and energy saving to replace fossil fuels;
c) Continuing on our current path raises the serious danger of “lock-in” i.e. it’ll become harder and more costly to escape climate change calamaties resulting from urbanisation, land use and energy consumption growth;
d) Only by addressing both poverty and climate change together can we create the beneficial outcome we need if we are to survive. All of this requires strong economic activity – more jobs, more investment, more recycling, more investment – more growth.

Nick Stern concludes that if we take early action starting now, we will create a much more benign social environment, with more shared interests, better social conditions, better health, greener cities and lower costs – more jobs, more resources, and more beneficial growth.

Some argue, like Tim Jackson, that growth is inevitably damaging and that “prosperity is possible without growth”. In practise, Tim recognises that we need rapid growth in benign, non-harming activities in order to shift from a resource-hungry economy to a circular economy. Converting to a circular economy of low resource waste, low consumption requires a very different kind of growth.

For several decades now, economists such as William Rees have proposed the value of a circular economy – that extracts only what can be replaced or recycled, that operates on zero waste, that puts back or regrows what it takes out, and that directs economic activity towards meeting needs rather than fuelling wants. There are signs of this happening in the most unlikely places.

Europe’s former industrial cities have been forced through the collapse and withdrawal of major industries – coal, iron, steel, textiles, machinery, engines, vehicles, weapons – into a new economy. Starting with government-backed reinvestment in their infrastructure – civic buildings, transport, factories and warehouses, canals and rivers, neighbourhoods and communities – they are piecing together a new future. The financial crash of 2008 followed by the Euro crisis suddenly cut public resources and forced them towards a “resource-constrained” and therefore circular economy. Thus we have live experiments all over Europe in a new kind of growth, that links the environment with social conditions – tackling climate change and energy shortages, over-crowding and international migration, austerity, and a new kind of growth.

Nick Stern’s conclusion that tackling poverty and averting climate change are intrinsically linked is close to Pope Francis’ plea for us to “care for our common home”, the planet, its people and its natural environment. We must care for the poor and the planet to avoid collapse. This requires a less greedy, more socially just, more equitable and more environmentally sensitive approach to growth.

 

Sources

Diamond, Jared. Collapse: How societies choose to fail or survive. Viking (Penguin Group): New York.

Hutton, Will. (2015). How Good Can We Be: Ending the mercenary society and building a great country. Little, Brown Book Group: London.

Jackson, Tim. (2011). Prosperity Without Growth: Economics for a finite planet. Routledge: New York.

Pope Leo XIII. (1891). Rerum Novarum Encyclical of Pope Leo XIII on Capital and Labour. http://w2.vatican.va/content/leo-xiii/en/encyclicals/documents/hf_l-xiii_enc_15051891_rerum-novarum.html

Pope Francis. (2015). Encyclical Letter Laudato Si’ of Holy Father Francis on Care For Our Common Home. http://w2.vatican.va/content/francesco/en/encyclicals/documents/papa-francesco_20150524_enciclica-laudato-si.html 

Power, Anne. (2016). Cities For a Small Continent: International handbook of city recovery. Policy Press: Bristol.

Rees. William E. ‘Achieving Sustainability: Reform or Transformation?’ in Satterthwaite, David. (ed.) (1999) Sustainable Cities. Earthscan: London.

Stern, Nicholas. (2015). Why Are We Waiting? The logic, urgency and promise of tackling climate change. MIT: Cambridge; London.

 

 

Anne Power is Professor of Social Policy at the London School of Economics and chair of the National Communities Resource Centre. She was a member of the government’s Sustainable Development Commission between 2000 and 2009. Her recent book, Cities for a Small Continent is about the need for a new and more sustainable kind of growth.

Going beyond the food banks

July 22nd, 2016

“To search for solutions to hunger means to act within the principle that the status of a citizen surpasses that of a mere consumer.” City of Belo Horizonte, Brazil.

 photo Play Sow and Grow_zpsssgrwc2i.jpg

At Tuesday’s report launch from the Trussell Tust, the Q&A focused on what can be done to prevent the rise in foodbanks. Currently, according to the findings of the report, our welfare system not only fails to prevent problems before they arise, it also struggles to deal with crisis. At Community Links we see this every day, with clients often needing food parcels due to benefit delays or some other crisis. The use of foodbanks continues to rise despite a reduction in sanctions, and it appears that foodbanks are increasingly being incorporated into the welfare system, as we previously feared.

Quite rightly, the discussion covered the need for the DWP to improve the benefits system as well as the expansion of foodbanks remits to include wider support and advice on debts, budgeting, and developing coping strategies. Yet I couldn’t help but feel that calls for central government to improve our welfare system are somewhat undermined by other crisis-causing policies. So what would an early action framework for food look like?

The city that ended hunger

The Brazilian city of Belo Horizonte, known as the ‘city that ended hunger’, declared food a ‘right of citizenship’ in 1993. A city agency involving local people was established to devise solutions to end food poverty, including directly linking up farmers and consumers, establishing low-cost, high-quality ‘people’s restaurants’, and enabling extensive community and school gardens as well as nutrition classes.

In only ten years, Belo Horizonte cut its infant death rate—widely used as evidence of hunger—by more than half, and today the initiatives benefit almost 40 percent of the city’s 2.5 million population. In the same ten years, Belo Horizonte was the only locality in Brazil which saw a rise in the consumption of fresh fruit and veg and local small scale producers increased their revenue despite farmers in the rest of the country seeing incomes drop by almost 50%. The cost of these efforts? Around $10 million annually, or less than 2 percent of the city budget. That’s about a penny a day per Belo resident.

Reasons to be hopeful?

A differing economic and agricultural context means that the Belo Horizonte model may be difficult to directly replicate in the UK. Yet it demonstrates that significant action can be taken to reduce food poverty despite an unfavourable national context.

In the UK, the burgeoning ‘food sovereignty’ movement is equipping communities with the means of producing their own food, thereby reducing barriers to fresh fruit and veg in spite of spiralling food prices, and simultaneously delivering multiple social, emotional and health benefits. For example, the Women’s Environmental Network is running a number of projects in Tower Hamlets which are empowering local women to work together to access affordable fresh food, whilst improving their physical and mental wellbeing and combating social exclusion.

Of course, such projects are generally small-scale and the structural conditions in which they operate, such as deprivation and job insecurity, also need to be addressed to achieve lasting change. Sustain’s campaign, ‘Beyond the Foodbank’, calls on central government to improve the benefits system, but also advocates for local living wages and city-level partnerships to address the root causes of food poverty in their locality.

This kind of systems change is already ongoing at Brighton & Hove City Council, who have relatively recently adopted a Food Poverty Strategy and Action Plan, co-produced with the local population and delivered by a wide range of local agencies. The plan has a distinct flavour of early action, recognising that the city needs to address food poverty now to save major costs later on arising from poor mental and physical health, poor educational attainment, obesity and malnutrition. Promisingly, a number of other councils have since replicated the model.

From passive recipients to active citizens

Evidently, whilst central government continues to deny any link between issues with benefits and the rise in food banks, there are still actions we can undertake to reduce food poverty; building people’s resilience and enabling them to lead thriving lives. Services shouldn’t reduce people to passive recipients but enable them to have active control over their own lives so they’re prepared to deal with setbacks and seize opportunities as they arise. And emergency food aid should remain just that.

A Question of Growth

July 21st, 2016

This blog is written by Dan Corry, CEO of New Philanthropy Capital, and is the third in our “A Question of Growth” series. Over the next few weeks we will be posting a new piece every Tuesday and Thursday. You can read all of the previous blogs in this series here.

 

Acting to prevent social problems emerging is clearly better than trying to deal with the consequences of those social problems when they arise. At its most obvious level it is clearly better for those individuals, families and communities not to have to suffer when earlier action could have given them a more fulfilling life . For many that is a good enough reason in itself to embrace early action.

But we can go further and argue that in the longer run it also saves money because the preventative action is cheaper than the ameliorative action left so late. This is very often true, but is really an empirical point. Does the early intervention work? Can we reduce the deadweight (helping those who actually never would get into trouble) enough to make it all cost effective? Is early action for someone with problems really going to work as a one shot activity or are we going to have to keep helping that individual over time? Nevertheless the case is pretty clear.

But one can go even further still and argue that early action helps promote economic growth. It does this essentially by allowing more people to contribute to economic activity – and so boost GDP. That is because there are less of them without the skills to get jobs, without mental health issues reducing their capacity to start firms, or without being victims of domestic abuse so they can really support their family or go out to work. It is because there are fewer communities left to swing in the face of the global world, and fewer estates where hope and aspiration are drained from the residents.

Once again, this assumes that the early action works and is cost effective. It also assumes that a job taken by a person who otherwise might have been outside the labour market does not to some degree displace someone else from a job – but generally that is a reasonable assumption.

But of course we have to be careful that we are not just getting growth at any cost – or the net effect on wellbeing, and sustainability of the planet can be negative. And that brings some restrictions on what is and is not good early action. For instance, a policy that reduced energy prices – to avoid fuel poverty – but did so by increasing carbon emissions would not on the whole promote good growth. Or a policy that improved the grades of most school children but at the expense of those on free school meals, so increasing inequality, would be called into question. Or a policy that does help people into jobs, but poor jobs, and produces lives that are so stressed that overall wellbeing goes down.

Some use this sort of critique to attack the very concept of growth – especially when that is measured in terms of GDP. They argue instead for ‘sustainable prosperity’ or other versions of what one might call ‘good growth’. That is fine – but it is dangerous to throw out the concept of growth itself as a prize from taking early action, as opposed to saying that other factors must be taken into account.

This is partly a PR issue – policy makers and citizens themselves want higher income and jobs and to tell them this is about something else will not help the cause of trying to divert budgets towards earlier action and away from dealing with crises. But it is also because it is right to keep a strong eye on growth even in its GDP version, imperfect though it is. We’d be making a mistake to ditch a measure of our progress which is measurable, understandable and something to which lots of people aspire, especially as we aren’t sure what we are supposed to replace it with – although we are making progress. Ditching growth completely makes no sense. Supplementing it with many other concepts and measures is the way to go.

Early action should be the way we go about allocating government money, charitable funding and the way we live our lives. Its aim is a better society, which does include growth – but it has to be growth that is sustainable and wellbeing enhancing.

 

Dan Corry is CEO of New Philanthropy Capital. He has been head of the Number 10 Policy Unit and Chair of the Council of Economic Advisers at HM Treasury.

 

The rise and fall of the Office for Civil Society

July 20th, 2016

Under cover of darkness the Office for Civil Society (OCS), a shadow of its former self, slips, almost unnoticed, out of the Cabinet Office, shuffles across Whitehall and finds refuge in the cavernous DCMS.

Does it matter to Community Links and organisations like ours? Not much now, no. And therein lies the sadness. Our contact, once regular and varied, had withered into almost nothing.

It is the final act in the rise and fall. Established as the Office of the Third Sector in the days when Gordon Browns Treasury team led the domestic agenda it embodied the administration’s commitment to placing the third sector at the heart of policy making and service delivery. It was well resourced, well led and consistently influential. In the time when Community Links was running the PMs Council on Social Action (2007 to 2010) our contact was almost daily and invariably productive.

The name changed in 2010 but the address remained the same, right next door to a new Prime Minister then cheerfully singing the praises of the Big Society. Midst the rubble of a collapsed economy there were still grounds here for optimism and confidence. How the mighty fall.

Gradually the OCS lost resources and influence to the point where the National Citizen Service and social investment were almost all that remained, but even as recently as March of this year hope flickered. George Osborne directed significant new money into an extension of NCS and into the Life Chances Social Impact Bond fund. The PM found a new tune. Once bitten by the opening bars of the “Big Society” our expectations of “Life Chances Strategy” were more wary, but it did sound like the kind of thing that might involve a role for the third sector. Theresa May picked up the refrain in her first Downing Street remarks last week. Perhaps the OCS would be loved again?

Not so. Unceremoniously abandoned across Whitehall last weekend there seems to be no more logic to the new location than that 27 Marsham Street had a few spare mugs and a desk or two.

The social investment work is important, to this government as well as to the sector, and it is definitively cross departmental. It would be far more sensibly located in the main Cabinet Office or the Treasury. One thing is for sure – it has absolutely nothing to do with culture, media or sport.

And as for the National Citizen Challenge, it is all that remains of youth work in many areas. It is not, in our judgement, an adequate replacement but it is big, well-resourced and apparently here to stay. Not embedding it properly, structurally and systemically, with schools and other services for children and young people is mindless and careless.

The institutional memory at Community Links stretches back to the days when governments contact with the third sector was largely run through the Active Community Unit in the Home Office. It was a bit like the Charities Unit in a big but unenlightened business, administering a modest and largely unchanging portfolio of grants to a small number of established organisations, unseen and unregarded by most people in the business and largely irrelevant to the overwhelming majority of charities.

The OTS and then the OCS changed all that. It was not just, or even primarily, about the money but about the conduit for contributing ideas, influencing policy, working together at the centre of government.

When there is so much for organisations like ours to work for and shout about “Revive the OCS” may be well down the agenda but it shouldn’t be forgotten.

In a belated written statement to parliament yesterday (Thursday)  afternoon the PM “confirmed” that the OTS had moved to the DCMS  4 days ago.  Rumours that No 10 staff had been “looking all over” were neither confirmed nor denied.

 

A Question of Growth

July 19th, 2016

This blog is written by Anna Coote, Associate Director for Social Policy at the New Economics Foundation, and is the second in our “A Question of Growth” series. Over the next few weeks we will be posting a new piece every Tuesday and Thursday. You can read all of the previous blogs in this series here.

 

We argue that early action to prevent harm and promote well-being will yield a ‘triple dividend’. This is summarised neatly as ‘Thriving lives. Costing less. Contributing more.’ But sometimes the third dividend – contributing more – is taken to mean that early action is good for us because it encourages economic growth. I strongly disagree with that interpretation.

If people are healthier and happier, they are likely to contribute more to society and to the economy. But in the longer term (by which I mean no more than a few decades), unchecked growth will have dire consequences for the natural environment. This in turn will make it difficult if not impossible for human lives to thrive and will trigger costly emergency measures to stave off ecological catastrophe.

According to leading authorities in the field, the need for human activity to remain within the ecological constraints of a finite planet is ‘the single most important challenge facing society today’. The overwhelming weight of scientific evidence shows that if the last decade’s trends in greenhouse gas (GHG) emissions continue, they will lead to a rise in global average temperatures of 4–6 degrees centigrade above pre-industrial levels by 2100. This will cause sea-level rises, greater water scarcity, reduced crop yields, ocean acidification, accelerated species extinction, and an increase in extreme weather events, all of which will have a severe impact on populations across the planet. A lot less thriving and spiralling curative costs.

The global ecological footprint, which measures the pressure of human production, consumption and waste on finite natural resources, has grown two and a half times in the last half century, and now exceeds the planet’s capacity by 0.9 global hectares per person. Put another way, the human race needs a planet half as big again to support its current activities. And if everyone were to live like the average US citizen, we’d need three and a half planets.

According to the Stockholm Resilience Centre, the exponential growth of human activities ‘could destabilize critical biophysical systems and trigger abrupt or irreversible environmental changes that would be deleterious or even catastrophic for human wellbeing.’ Unless we heed the scientists’ predictions, there will, within a matter of decades, be no recognisable human society for which to plan effective early action.

But is there such a thing as good growth? Is it possible to decouple production from GHG emissions by switching entirely to zero-carbon energy sources, or to go on making more and more things without exhausting finite natural resources? In theory, perhaps, but not in practice. There is no convincing evidence to support the aspiration. Economic growth continues to rely on – and drive – resource-intensive production and consumption.

Without an imminent miracle, efforts to achieve ‘weightless’ or ‘green’ growth will fall short, by a very wide margin, of the reach and speed required for the human race to live within planetary boundaries, or to keep global warming within limits compatible with human wellbeing. Tim Jackson, the distinguished environmental economist, has exhaustively examined the evidence on decoupling in his book Prosperity without Growth. He concludes: ‘There is as yet no credible, socially-just, ecologically-sustainable scenario of continually growing incomes for a world of 9 billion people… simplistic assumptions that capitalism’s propensity for efficiency will allow us to stabilise the climate or protect against resource scarcity are nothing short of delusional.”

Classical and neoliberal economists may remain wedded to the idea that we can only measure the ‘success’ of an economy by how fast and far it grows. But mercifully there is now a burgeoning counter-movement, supported by Nobel prize winners such as Amartya Sen and Joseph Stiglitz who support alternative measure of success, notably wellbeing.

Stiglitz and Sen served on the Commission set up by the then French President Nicolas Sarkozy on measuring economic success and social progress, which reported in 2009. The Commission concluded that “the time is ripe for our measurement system to shift emphasis from measuring economic production to measuring people’s well-being. And measures of well-being should be put in a context of sustainability.”

Wellbeing can be understood as the way people feel when they lead a good life, functioning well on personal and social levels. It implies a sense of competence, of meaning and purpose and of being connected to others – which together produce feelings of happiness and satisfaction with life. It is proposed as one of five headline indicators of national success by the New Economics Foundation, based on an exhaustive study of official statistics, public attitudes and measurement techniques: the others are good jobs, environment, fairness and health.

Between well-being and economic growth as competing measures of human success, there are profoundly different views about what really matters to us, what constitutes a good society and what we mean by ‘thriving’. What is the essence of a successful life? Buying more and more stuff? Or caring for one another and safeguarding the planet for current and future generations? For me, it can only be the latter.

Tim Jackson and others argue that an economy cannot be judged successful unless it is sustainable, which means meeting ‘the needs of the present without compromising the ability of future generations to meet their own needs’. A sustainable economy can be prosperous and flourishing, but growth is ultimately incompatible with meeting present and future needs. So let’s put it this way: we support early action that enables people to ‘contribute more’ to a sustainable and prosperous economy.

 

Anna is Associate Director for Social Policy at the New Economics Foundation. Her previous roles have included Commissioner for Health with the UK Sustainable Development Commission and Director of Health Policy at the King’s Fund.

 

A Question of Growth

July 14th, 2016

We start a new series today. We will be running blogs two or three times a week for the next month or so on the question of growth. Here’s why…

The Early Action Task Force has argued that a determined shift towards investing early in social wellbeing would yield a “triple dividend” – it would help us all to be happy and healthy at every stage in our lives, it would save money that is currently spent on later stage, crisis intervention and it would strengthen national prosperity as more capable people contribute more to a flourishing economy. Thriving lives. Costing less. Contributing more.

The third dividend – Contributing More – is sometimes called the growth argument and has proved important in our conversations with government. However whilst increased prosperity can support more early action and a more capable community can contribute to greater prosperity – a virtuous circle – there are no necessary correlations. Growth that abuses rather than nourishes social capital or natural resources has the opposite effect.

The Task Force has been asking “what constitutes “good growth?”. As you will see from the forthcoming blogs, members have range of opinions. Towards the end of the series we hope to be able to tease out some critical questions, maybe also some common threads, and to suggest some of the characteristics of an economy which prioritises sustainable growth and long term benefit. We hope that this will also enable us to make a useful contribution to the Growth Commission but we will make a judgement about that when we see what we’ve got.

We would very much appreciate your views on these issues. If you’d like to write a blog please contact me at david.robinson@community-links.org. Alternatively post a comment in the usual way on the blogs that others have written.

We have been wrestling with these issues for some time but the sudden and current storm of economic and political uncertainties makes it even more important that we work for clear and positive priorities. Please help us get this right.

When they have been posted, you will be able to see all contributions to this series here, or by clicking on the banner above.

We begin the series today with a contribution from Caroline Slocock. Watch out for Anna Coote and Dan Corry up next.

 

Early Action and “Good Growth”

 

We need to start thinking about early action differently. Too often it is seen as a cost rather than an economic investment and this is one of the reasons why it is so poorly and sporadically funded. It is good for the economy and key to sustainable growth.

Investment in early action should be happening in parallel with funding for job creation and capital infrastructure, not as an afterthought. Effective early action – to achieve better health, improved educational attainment, productive and stable employment or independent living, to name but a few examples – helps everyone to achieve their social and economic potential and leads to healthier, happier lives. People who are helped in this way will contribute more – whether by generating wealth through work and paying taxes, or by helping to create the underlying conditions in which economies thrive: cohesive communities and social capital.

There’s a strong social and moral case for early action, certainly, and this must continue to be made. But it’s also important when resources are being heavily rationed to recognize that effective investment in early action can help turn people and communities who are at risk of becoming a net cost to the taxpayer into net assets. When the case for early action is seen only as social and moral, that type of spending tends to be squeezed out. As the Core Cities group (which represents the largest cities of the UK outside London) has repeatedly said, services that prevent expensive demand have been cut hardest as a result of austerity, creating a false economy that only pushes up costs on welfare and health. This is a negative cycle that over the longer term will simply undermine the very fiscal sustainability that has been the key economic goal of the current Government to date.

We need an alternative, positive cycle of investment in early action, one that reduces avoidable demand for services and seeks to remove any barriers that stand in the way of the positive contribution that everyone can make. The economic case for such investment is already recognized in relation to human capital, with the education budget protected from cuts. Measures to reduce long-term unemployment are also seen as having an economic as well as social value. But there are many other interventions that would yield a significant return on investment that are currently underfunded.

There are those who will say that the returns on early action investments are not as concrete as those on capital investments. However, in New Zealand, the Government has adopted an “investment approach” that uses private sector actuarial techniques to identify at an early age groups most at risk, for example, of unemployment and to calculate the long-term financial costs without intervention. A proportion of anticipated savings is then invested to intervene early to prevent risk factors from turning into reality. It has taken off there and we could adopt it here. We could also seek to factor in wider economic benefits such as increased productivity and payment of taxes into our calculations.

Of course, some maintain that all growth is “good growth,” even where it involves exploitation that leads to poverty and inequality, because they argue wealth will “trickle down” to everyone eventually, leading to higher standards of living for all. However, Thomas Piketty’s book, Capital in the 21st century, has now revealed that the gap between the richest and poorest has actually been growing consistently over many years: “trickle down” is not happening.

Indeed, poverty and inequality is now being increasingly recognised as a threat to economic stability and growth. In 2014, the head of the International Monetary Fund said at an international conference on inclusive capitalism that inequality was a barrier to growth and could also undermine democracy. The UN’s Sustainable Development Goals, which were unanimously adopted in 2015, include commitments to end poverty, tackle inequalities and take steps to reduce global warming – all of which potentially threaten our way of life and require sustained investment.

Arguably, a failure to spread wealth equally in Britain is now prompting the biggest rethink in a generation of our economic course. Certainly, those who have failed to benefit from recent growth and have suffered most from cuts in public spending are more likely to have voted to leave the EU. In doing so, they have taken the rug sharply from underneath an economic model based on a single EU market, mobility of labour and a policy of austerity which Ministers have maintained is essential to achieving fiscal stability.

As a result of the Brexit vote, potentially, all the cards are now up in the air. This is a fast-moving scene but, at the time of writing, there are already some signs of a shift in economic direction. George Osborne’s 2020 surplus target has been abandoned, for example. The new Chancellor, Philip Hammond, has talked of the economy entering “a new phase.” In her first speech, the new Prime Minister spoke of improving life chances and correcting injustices.

Even before the referendum, greater devolution in England has been leading to calls for investment in social programmes, as well as investment in infrastructure and jobs, in order to create sustainable growth. Linked to this, a new Inclusive Growth Commission has been launched with backing from the LGA and the Core Cities group and is led by the economist, Stephanie Flanders. This is seeking (in the words of Sir Richard Leese who chairs the Core Cities and Manchester City Council) to “build a stronger, fairer economy built bottom up.” Brexit adds grist to this mill.

Rocky times lie ahead, but the stage is potentially being set for Theresa May’s Government to pursue an economic strategy that has a philosophy of prevention at its heart.

What would this strategy look like?

Greater prosperity, including well-being, will be its goal, recognizing that not all growth is good, but “good growth” has early action at its heart.

“Good growth” must be environmentally and socially sustainable, meeting the needs not just of current but of future generations. Growth that destroys the planet and damages the environment clearly cannot pass this test. Economic activity that undermines the health and well-being of individuals or communities is also unsustainable.

Furthermore, a “good growth” strategy will seek to prevent inequality and poverty from happening and will actively promote well-being and good health. This is not just because social, economic and health inequalities are unacceptable and may even undermine stability, but because ensuring that all individuals and communities have the opportunity to make the most of their potential is the best use of society’s rich resources.

Good goals do not automatically translate into good practice so it will be important that early action is hard-wired into policy – with a long term investment approach that looks at costs and benefits objectively; breaks down silos that obstruct effective early action; protects early action spending, like capital, from short-term acute pressures; and seeks over time to redirect acute spending into a virtuous cycle of early action investment.

The social and economic case for this is clear. As we say in the Early Action Task Force, early action has a triple dividend: thriving lives, costing less, contributing more.

 

Caroline Slocock is the Director of Civil Exchange and a member of the Early Action Task Force.  She also has extensive experience in central government at senior levels, including in the Treasury, where she was the Senior Policy Adviser on Public Expenditure.

 

 

Project is a ground force for spirit of human kindness

July 11th, 2016

Our long term supporter and friend, Colin Grainger, shares with us the remarkable partnership between Community Links, a college and its students and local companies, which has brought real lasting social value to our centre Arc in the Park. Colin Grainger is a former editor of the Newham Recorder and now a freelance journalist for the Guardian. Every year Colin plays a huge part in our Christmas Toy Appeal, which reaches out to thousands of vulnerable families at Christmas. 

In the last few weeks, the nastier side of life has surfaced in this country and it is not something I personally recognise as the true picture of the nation I am proud to live in.

But today I am happy to report on something that has shown the true spirit of human kindness still very much exists in east London. Something which I hope brings a little of the Great back into Britain.

It involves a charity that has been a part of my life for nearly 40 years, a facility that has done so much to help young people overcome their problems, a facilities management and building maintenance provider, a college and its students and companies who are proud to work for the greater good, proud to put something back into the community they serve.

In just five days, these special people in the photo above, transformed Arc In The Park in Canning Town in such a way that it will help future generations.

The fine upright and outstanding citizens of east London showed what can be done when we all work together. All of us, all colours, creeds and backgrounds.

The students from Barking and Dagenham College are all from Newham as are many of the workers. Some of them, as they will tell you in the film, were actually helped by Community Links when they were youngsters

As part of their Social Value commitment, Vinci Facilities worked with Community Links to engage them in working on a restoration project, at Arc in the Park in Hermit Road, Canning Town.

Vinci, Barking and Dagenham College and all those involved in this restoration of Arc have brought real lasting social value. It’s time for these people to stick out their chests and be proud.

Thanks go to AKW, Crown Flooring, PW Building Services, GBN Services, AkzoNobel, Dulux, KND Construction, 1st Environmental Services, John Plank Ltd architectural hardware, A Plant, Scaffolding Access Ltd, 3D Specialist Joinery Ltd, Fire and Safety Solutions, Broadway Decoration, Newham Play Association and Inveigle Productions for this brilliant film. Filmed and edited by Gary Dudman, Jamie Elliot and Louise Levitt.

MPs, Sex and Early Action

July 7th, 2016

It is not for this blog to comment on the merits of the Conservative leadership candidates, but reports from the MP hustings on Monday evening were of wider concern and very relevant to our agenda. This piece, by David Robinson, was first published in the Huffington Post.

 

At the Conservative party leadership hustings on Monday evening Andrea Leadsom apparently referenced her work on developing a long-term and cross-party vision for the early years. Her commitment to early action builds on a lengthy involvement with Northamptonshire Parent Infant Partnership, a charity providing therapeutic support to help parents bond with their babies, and with PIPUK, the national body for Parent Infant Partnerships, which she founded.

The hustings were private but lobby correspondents were soon reporting that Leadsoms performance was “a car crash” and, specifically, that her remarks about the importance of the early years went down “like a cup of cold sick”. “It was meant to be an application to be PM”, one MP scoffed “not a childhood development officer”. Several stories recounted how talk of “the prefrontal cortex of a baby’s brain” “lost the room” and the Sun described “people talking to one another and playing on their ipads.” All the quotes were attributed to anonymous male MPs.

What was it about the significance of the early years that the boys found so much more difficult to grasp than, say, the case for quantitative easing or the minutia of Article 50 or so much less relevant to the future of the country than whether Ms Leadsom did or did not receive a tweet from Boris Johnson last Thursday evening? It is unimaginable that reference to investment in, for instance, the Northern powerhouse would have been received with such derision. Even the metaphors were infantile – “cold sick”, “car crash”.

Ms Leadsom co-founded the All Party Parliamentary Group on the early years which I was invited to address in April. I pointed out in my presentation to the meeting that investment in early action yields rates of return which consistently outperform the ROIs on roads and railways (£2.83 per £ invested in programmes for Under 9s, between £1.80 and £2.50 for HS2). Quite apart from the strong social case for early action there is also, if only the lads had been prepared to listen, an overwhelming economic one. Foolishly they apparently didn’t listen to their wannabe leader and they certainly didn’t listen to me. My engaged and knowledgeable audience consisted of approximately 50 women and exactly 3 men. I was surprised and disappointed by the scale of this discrepancy but regular attenders assured me that it was “always like this”.

I have no idea who should be the leader of the Tory party but I do know that any mature and rational reading of the evidence evinces the inevitable conclusion that the next Prime Minister needs to understand the importance of early action and invest intelligently in the long term social infrastructure of our country at least as much as they need to understand the importance of investing in roads, railways and northern cities. It says more about the audience at the hustings than it does about the speaker that a promise to focus on “bankers, Brussels and babies” should have been so scornfully dismissed.

Sometimes I am ashamed of my sex.

Doubling down on early action

July 6th, 2016

One newspaper cartoon last week had 2 students discussing their plans. “I’m reading political history” said the first, “my period of study is from 2 am on Friday June 24th 2016 to 12 noon on June 30th.” An awful lot has happened in the last two weeks and the storm is not abating. The Brexit vote started the turmoil. One significant event hurtles after another. Political and financial uncertainty rattles everything and fear of further disruption becomes a disruptor in its own right.

I have now been involved in three conversations in 10 days with politicians or government officials who have variously described planning, forecasting or budgeting in the prevailing climate as a “very difficult“, “a fools game” and “just impossible”.

The temptation to batten down the hatches makes sense if we have some expectation that the storm will pass. As it is we cannot predict when the weather will change but we do know that it won’t be soon. We can’t wait, we have to adapt.

It may seem peculiarly obtuse to argue that this is the moment for long term thinking but actually it’s true. If escalating needs and diminishing resources were, pre-Brexit, already set on divergent and unsustainable trajectories then the pattern has been reinforced, the scale has been magnified and the speed intensified. More than ever now we need to break the constraints of short term thinking and siloed delivery, and now focus on sustainable, long term solutions.

This is not as impossible as it might seem. Five, seven or even ten year planning as recommended by the Early Action Task Force is not about setting the budgets in stone for the years ahead. It is about weighing up the costs and consequences of every spending choice over the longer term even if the funding is fixed for a much shorter period of time, possibly just one year. This approach to planning would lead to different kinds of decisions from the short term crisis management that already characterises many social spending programmes. We expand on it in “The Deciding Time” and other publications.

There are glimmers of hope. Some vestiges of the Life Chances strategy that the PM was expecting to announce on the day after the referendum seem likely to survive without him. The Life Chances Fund was unveiled on Monday with explicit reference to programmes that “support early action” and the pace setting practitioners in early action already recognise that , as I heard Sophie Howe – the Futures Commissioner in Wales – say in Cardiff on the same day, “this is a conversation that we must have now in public” and “We wont always get it right but it is the right thing to do.”

In other words there are risks in new things and there will be failures, but not thinking about the future at this time and not discussing it openly will inevitably lead to deeper, more expensive and more intractable problems in very short order. I had heard Martin Reeves, The Coventry City Council CEO, say something similar even before the current turbulence at the launch of the Coventry Ignite programme last year and Deputy Chief Constable Andy Rhodes in his Insights presentation on the ground breaking work of the Lancashire Constabulary.

Media coverage of the events of the last fortnight would have us believe that everything changed. Certainly a lot moved and is continuing to move but values are more constant. Trying to bequeath to our children the best that we can is not an option for us any more than it was for previous generations, it is a responsibility. Prevention and early action in the public realm have been difficult but recognisably good ideas since the public health reforms of the early Victorians. Now is not the time to back away, but the time to double down.