Regulation – Page 2 – We Know Zero

Horizon and its implications for us all

11. January 2024 · Write a comment · Categories: Actuarial, Cartoons, Legal, Prediction, Professions, Regulation

Copyright ©Steve Bell 2009/All Rights Reserved e.mail: belltoons@ntlworld.com tel: 00 44 (0)1273 500664. Reproduced by kind permission of Steve Bell https://www.belltoons.co.uk/bellworks/index.php/leaders/2009/2913-16-10-09_BOINGUSES

We have been here many times before, even in recent memory. The 2008 banking crisis, memorably immortalised by the Steve Bell cartoon above; the MPs’ expenses scandal the following year; the successive disappointments of Brexit; and now the the Post Office Horizon scandal. All of these had in common an initial public expression of outrage, followed by loud condemnations of aspects of it from within the Establishment, followed by a series of measures which generally failed to change anything substantive. So the ring-fencing legislation brought in to isolate the risk taking within banking from retail customers has steadily been lobbied against and is now gradually being unravelled. MPs continue to have expenses scandals. I don’t know how to encapsulate in a sentence the Muppet Show of how the Establishment has been trying to deal with Brexit since 2016. And now this.

The Post Office scandal seems to be being discussed everywhere: beyond the TV, radio and social media, it is in the pub, the supermarket queue, in families and workplaces. The Establishment condemnation is already underway, as pithily summarised by Marina Hyde here. I do not really care about the implications for the honours lists, but very much hope that the sub-postmasters and sub-postmistresses get the compensation they are seeking. However this time the response cannot stop there.

As David Allen Green has written in Prospect today (with a great overview of what has happened from a legal point of view), the scandal also represents a failure of the legal system. This was partly caused by the repeal, in 1999, of the part of the Police and Criminal Evidence Act 1984 which presumed in favour of individuals rather than computer systems. This has been particularly unfair in these cases as the evidence defendants needed to show that Horizon was at fault often remained undisclosed by the Post Office. It was also caused by the Post Office’s eagerness to pursue private prosecutions.

Coincidentally, I came across the concept of private prosecutions a couple of weeks ago while reading the excellent Butler to the World: How Britain became the servant of tycoons, tax dodgers, kleptocrats and criminals by Oliver Bullough (which also suggested to me that I should revisit the issue of Scottish Limited Partnerships soon, but I digress). As Oliver points out:

Under measures introduced in the post-2010 austerity agenda, defendants…have no prospect of reclaiming their expenses from public funds if they are convicted. Even if they’re acquitted, they can only get their expenses back if a request for legal aid has previously been turned down…Meanwhile, private prosecutors – whether individual or companies – can claim back all reasonable expenses if they lose. Financially speaking, a private prosecution is a one-way bet. As long as you can afford the upfront cost of bankrolling the case, you’ll get your money back because under common law you are acting on behalf of the Crown.

David Allen Green has called for private prosecutions to be abolished, which I would agree with. But I also think the burden of proof needs to be returned to the operators of computer systems in what I predict will become increasingly frequent human-expert system disputes in the future. In fact we need to go further than that and have a full public consultation into what legal protections individual humans will need in a world increasingly driven by decisions and calculations made by non-human systems.

Over seven years ago I wrote an article in response to Cathy O’Neil’s excellent Weapons of Math Destruction, where she set out the case against devolving important decisions to mathematical models without adequate feedback loops. I said then (with an Oppenheimer reference too!) that:

If mathematical models are to be the dominant regulatory tool of a financial world, and of the consultancies and financial firms competing in that world, then the time will come when mankind will curse the names of the highly paid professionals who followed inappropriate rules rather than exercising their own expert judgement when it mattered.

It is starting to look like we may be there already unless we act fast.

What would be gained from increasing the state pension for all?

09. January 2024 · Write a comment · Categories: Actuarial, Antifragility, Cartoons, Pensions, Regulation, Risk

Source: https://youtu.be/31xY6rYiu2E

When I was nearing qualification as an actuary at the turn of the century, one of the recommended texts for both the specialist pensions (the then equivalent of SP4 and SA4) exams was Alastair Jollans’ 1997 paper to the Staple Inn Actuarial Society (SIAS) entitled Pensions and the ageing population. At the time there was quite a lot of actuarial comment about how superior a funded pension system was to a pay-as-you-go system and the example of Chile in particular. The following sentence from Alastair’s paper stuck with me at the time:

It is also clear that the Chilean scheme made a huge psychological difference, and this may be one of the major advantages of funding.

Meanwhile the Labour Government had been moving to reform the State Earnings Related Pension (SERPS) with its Green paper of 1998 A new contract for welfare: partnership in pensions, and replace it with a new State Second Pension (S2P). It had two aims – giving more help to people for whom private pensions were not an option and helping moderate earners to build up better second pensions through the introduction of stakeholder pensions. The intention was that S2P would become flat-rate over time with the following reasons given for this (bold mine):

Although SERPS is an efficient second pension, it is earnings-related. It does least for those on low incomes who have most difficulty in building up a good second pension. Many people on modest incomes will also receive limited benefits from SERPS or from the private provision they may make instead.

So the limitations of the current system (where the new State Pension has replaced S2P and auto-enrolment has replaced stakeholder pensions), as previously discussed here, were recognised from the outset of the experiment of moving to funded pensions.

Fast forward to now and Chile’s system is tottering, leading to mass protests. It turns out that the psychological advantage of its funding approach was only an advantage for those that could afford it, whereas the 40% who gained no benefit from invested funds (a remarkably similar proportion to the UK statistics) preferred the psychological advantage of a guaranteed state pension. Even the FT admits it needs reform, although fairly technical in nature:

At the very least, a sensible reform now should be to eliminate the investment limits by asset class and introduce an investment policy based on risk metrics at the portfolio level. The government should also relax the restrictions on alternative investments and eliminate the ill-designed hedge requirements.

The Council on Foreign Relations was less restrained in 2022:

Pensions were never a good fit for strictly private management, as basic building blocks of the welfare state are definitive public goods. Yet the failure of the system has reverberated beyond the retirees trying to make ends meet. Pensions became a leading cause for the millions of Chileans who took to the streets in protest in 2019, spurring the formation of a Constituent Assembly to write a new Constitution that will be voted on in September.

The best path for pensions would be a reform that ensures adequate retirements for more Chileans. This requires a more robust public system with dedicated funding to sustain it. If legislators can make this happen, they can reduce the financial hardship too many of Chile’s elderly now face. And, to the benefit of democracy in both Chile and its neighbors, they could also thereby restore at least some of the political legitimacy that the old system helped to put in doubt.

In my first post in this series, I explained why the State Pension needs to be much bigger than the Triple Lock is ever going to get it to. The second post then moved on to discuss the leaky pensions budget and what to do about it. In this third and final post in the series, I focus on why increasing pensions should be a priority when there is so much destitution in all parts of our society.

We are living in anxious times, with discomfort about the state of the world now so extreme that many of us are disconnecting from it and, instead, treating it as a personal mental health challenge requiring breathing exercises and mindfulness and radio programmes like Radio 2 Unwinds with Angela Griffin and similar. This follows a pattern with other crises, where we have been encouraged to abandon collective action to protect our pay and conditions by ever more onerous anti-union legislation or to abandon collective action to combat climate change by ever more onerous anti-protest legislation. Instead we are constantly encouraged to look inward and focus on our own wants and the things about ourselves which are standing in the way of those wants, ie to approach the world solely as a consumer. It is much more convenient for the companies working in the retail markets if we all behave this way.

Moving away from the collective provision of state pensions for all to a reasonable level and instead towards the individual provision of funded occupational pensions follows this pattern. However, as we have seen, many have been left in poverty without any asset security as a result of this move. This leaves them more vulnerable to sickness, debt and generally less resilient to the uncertainties of the future.

Seth Godin recently blogged about the engineering philosophy essential to creating something both useful and fit for purpose. It involves asking who is it for and what is it for.

Increasingly I feel that we have lost sight of these two questions in how we provide pensions, my answers would be:

Who is it for? Everyone.
What is it for? To increase people’s resilience.

In the case of resilience, the discussion has been kept at a, in my view deliberately, high level of abstraction so that most people feel that it is not their concern. McKinsey produced a particularly incomprehensible example here, but it is probably unfair to pick on them as they are just one of many, and they did at least mention societal resilience. A great technique for excluding people from the discussion is to produce a proliferation of definitions which noone can agree on (five were identified in this article in Nature by Rockstrom et al, for instance). However, as Rockstrom identified, in essence a resilient system needs just five characteristics:

Diversity, ie support comes in multiple forms and does not assume everyone is the same;
Redundancy, ie if one part of the system fails, there is always a good Plan B and mechanisms available to replace system failures quickly and efficiently;
Connectivity, ie our supply chains are diversified and the resources we need drawn from a wide range of sources, and our populations are kept well connected with each other and the services they need;
Inclusivity and equity; and
Adaptive learning, ie we review whether the system is working reasonably frequently and learn from experience.

So what would be gained from increasing the state pension for all?

Marginalising older people when their bodies already feel less resilient and forcing them into the boxes required by our processes of means-testing are likely to extinguish many of these voices from the national discussions we need to have. A significant increase in pensions for all, instead of the ridiculous triple lock which is only tolerated as it slowly gets us to this goal without having to have the discussion about what a decent pension would be, is what is needed.
A larger state pension would give us all more security through redundancy, ie a decent baseline underneath the other sources of income. Our invested pensions are not as diversified as they look and very vulnerable to a range of system-wide events and our means-tested benefits are very frequently prone to error and delay. The prospect of this greater level of security and certainty in retirement would also ease the burden of many working age families who are supporting older relatives, and the effects would therefore extend well beyond the retired population.
Poverty crushes the diversity of a population, as the cartoon above from the UN Special Rapporteur on poverty Olivier de Schutter makes clear. We need diverse people with diverse thought and we need to include them in our society and listen to what they have to say.
Focusing on those of retirement age to allow them to live better will save money in other areas. According to a Guardian study, an 85-year-old man costs the NHS about seven times more on average than a man in his late 30s. Health spending per person steeply increases after the age of 50. It would also reduce reliance on an inefficient and fragmented disability benefit system.
Increasing the state pension would obviously have a much greater effect at the bottom half of the income deciles than at the top and would therefore have a big impact on inequality. As the Institute of Fiscal Studies said of increases to the minimum wage for working people between 2011 and 2021:

...inequality in male earnings rose between 1980 and the Great Recession, driven by rising wage inequality at the top and rising hours inequality at the bottom. This trend appears to have stopped in the last decade, as growth in the minimum wage outstripped wage growth further up the distribution, and hours worked stopped falling disproportionately for low-wage men.

Increases to the state pension would be likely to have just as dramatic an effect.

And we all gain from a more equal society, even those we redistribute away from. As the Equality Trust have shown in their research, high levels of income inequality are linked to economic instability, financial crisis, debt and inflation; less social mobility and lower scores in maths, reading and science; an increase in murder and robbery rates; reduced longevity, more mental illness and obesity, and higher rates of infant mortality. People in less equal societies are less likely to trust each other, less likely to engage in social or civic participation, and less likely to say they’re happy.

My view is that we need to start somewhere in creating a more equal, and therefore more resilient, society here in the UK. And I would start with pensions.

Volunteers and Democratic Deficits

07. December 2023 · Write a comment · Categories: Actuarial, Cartoons, Legal, Regulation

My favourite bit of Scrooged is when Bill Murray is told that the people working in a homeless shelter cannot be fired because they are volunteers. It appears that the Institute and Faculty of Actuaries (IFoA) is instead in danger of morphing into such a sleek, streamlined, efficient, simplified and clarified organisation that noone would want to volunteer for it any more.

The long-running argument about the future governance of the IFoA grinds on. Four months after a small number of members alerted the rest of us to what was going on, and 194 members then objected in writing, the IFoA have now concluded a series of webinars explaining the proposals. I attended the final one on 28 November.

In a nutshell, the proposals are unchanged from those objected to, they are now being considered alongside the objections by the newly elected Council this month, which will be followed by a full consultation in January. The new governance structure will then be rolled out in the summer of 2024 and a member vote only allowed on the new structure two years later in 2026. Yes that’s right, not a typo: 2026!

The session I attended was all about how we needed to be more streamlined, more efficient, more credible in our governance. We needed to simplify our governance, clarify it. The recent embarrassments about outgoing CEOs was cited as an example of our poor governance without explanation. The independent report which they quoted from throughout to justify the proposals will not be provided to members as it includes contributions from people who only did so on the basis of anonymity.

There was a discussion about how the IFoA was both a business and a member organisation. But, in mentioning more than once how the proposals were only what any of the organisations members worked for would expect from their governance, the weighting given to these two roles was very clear. These were senior business leaders attempting to make the IFoA look more like the businesses they are more used to.

If you’re a senior business leader, then an organisation where any member can have some influence on its direction of travel must be incomprehensible. They are used to leading and being followed. Much was made of the waste of time that much Council business involved, and I am sure that is right. But that is just a motivation for change, as indeed was the entire presentation on 28 November. It was decidedly not a motivation for this change in particular.

We were told that other options had been considered, although bundling everything up into one board that did everything was the only one mentioned.

One of the other reasons given for the changes proposed was how much bigger the IFoA was now. Coincidentally, on 27 November, the Economic Affairs Committee of the House of Lords published its report ‘Making an independent Bank of England work better’. In it they made the following point:

The growth in the Bank’s remit has not been met with a commensurate increase in accountability and Parliamentary scrutiny. While an independent central bank reassures markets, critically important economic decisions are delegated to unelected officials. The Committee is concerned that a democratic deficit has emerged, which risks undermining confidence in the Bank and its operational independence.

We are being asked to quietly acquiesce to the creation of precisely this kind of democratic deficit in our own member organisation. Because, despite suggestions to the contrary in the webinar, we are primarily a member organisation and not like the organisations we all work for, something we have just been reminded of by being charged £750 for the privilege.

If we agree to this timetable, then by the time we get to 2026 I predict we will be assured that it would not be cost effective or a good use of the new unitary board’s time to uproot what will by then be the incumbent system. This would be giving these proposals an unfair advantage in deciding on the long-term governance of the IFoA.

My requests would be:

Some summarised form of the independent report which protects people’s anonymity but allows us members to judge for ourselves the relative strengths and weaknesses of the analysis of our current governance and the options so far considered for change.
An opportunity for a member vote on the structure adopted in 2024 alongside the consultation, rather than 2 years post adoption.

It is precisely at the stage of deciding that structure that all of the range of experience, talent and wisdom of the membership needs to be deployed, not at the point of rubber stamping a decision already made. If you agree with me that members are being sidelined in the decision-making process about the very nature of the IFoA’s future, then please send your feedback to governance@actuaries.org.uk.

There’s a hole in our bucket

02. December 2023 · Write a comment · Categories: Cartoons, Pensions, Regulation

In my previous post, I talked about out how dependent the bottom half of the income scale was on the state pension of £10,600 pa, and how an increase of at least 40% to the state pension was needed to reset the balance between a guaranteed income and that based on the markets to European levels.

However there was another aspect of the state pension which I did not mention last time and which also needs to be addressed.

Who gets it?

Source: ONS – Almost all pensioners (97%) received income from State Pension, with an average amount of £195 per week. Some peaks in the distribution may be explained by the basic State Pension rate, which was £137.50 per week in FYE 2022, as well as the new State Pension full rate, which was £179.60.

As the graph above shows, by no means does everyone get the full state pension (although legacy state benefits mean that some get considerably more).

As the Undefined Benefit: Fixing the UK Pensions System report mentioned in my previous post explains:

To qualify for this full state pension, an individual needs to have made 35 years of National Insurance contributions or have equivalent credits. To qualify for any fraction of the state pension, an individual must have made at least ten years of contributions or have equivalent credits. Thus, even the UK’s first pillar, the state pension, is to a degree contribution based. This stands in contrast with countries such as Canada, Mexico, the Netherlands and New Zealand, which have adopted a residence-based, non-contributory basic pension. Residency-based pensions increase coverage and seem to be effective in reducing poverty rates in old age.

How much?

Returning to the PLSA’s retirement living standards again, we have the following:

Source: PLSA – these are single retirement living standards outside London

You will note that the retirement living standards assume:

income tax is payable;
people are mortgage and rent free; and
it also does not cover care costs.

The minimum level would then require a 21% uplift to the basic state pension, assuming no meaningful private or occupational pension assets (which we saw last time was a reasonable assumption for most of the bottom half of the income scale).

According to the Government’s figures, in 2020-21, 5% of all older households (ie where the household “reference” person was 65 or older) were mortgagors, 6% were private renters and 15% were social renters (down from 19% in 2010-2011). The remaining 75% of older households were outright owners (up from 71%). So we are going to need more for our minimum level to meet the needs of the 25% who are still paying rent or mortgages. The average household income spent on rent amongst older renters is 38% for private renters and 27% for social renters.

Assuming this household income is the basic state pension and the average housing costs of the group we are concerned about (ie totally or almost totally dependent upon the state pension) are in line with social housing rent, we would need an additional 37% uplift to the state pension (to mean that taking 27% of it would get you back to where you started) to 66% of state pension, ie a total of £17,600 pa before the latest state pension increase. If you are aiming for the moderate retirement living standard you would need over twice as big an overall state pension at £35,600 pa.

Means-tested benefits

At this point, if you are shouting at your phone or computer “but you are ignoring means-tested benefits!” you would be correct. Age UK give a handy guide to means tested benefits, but in a nutshell we have:

Cold Weather Payment – £25 a week for each 7-day period of cold weather. This only applies between 1 November and 31 March each year.
Council Tax Support – there is no set amount of Council Tax Support. What you get depends on your circumstances and where you live. Each local council is responsible for operating its own Council Tax Support scheme so the amounts of support given across the country may vary.
Housing Benefit – Housing Benefit is money to help you cover your rent if you’re living on a low income.
Income Support – this is going to be fully replaced by universal credit by the end of 2024. Universal Credit has come in for a lot of criticism – this is the Trussell Trust’s take on it.
Pension Credit – the bit of this that we are interested in is the Guarantee Credit, which tops up your weekly income to a guaranteed minimum level. In 2023-24, this level is: £201.05 if you’re single and £306.85 if you’re a couple (note that these are still below the levels of the basic state pension).
Universal Credit – for a single person over 25 this is currently £368.74 per month but there are many circumstances which can lead to deductions to this amount and the Trussell Trust (see above) has this to say about it:

These are at the lowest levels in 30 years and aren’t protecting people from destitution, meaning they are unable to afford the essentials we all need to eat, stay warm and dry and keep clean.

The trouble with means-tested benefits are:

Not everyone claims them. An FT article from April 2022 claimed that there were £15 billion of unclaimed means-tested benefits – for a variety of reasons, but with lack of internet access (18% of older households) being a major one. This compares with £5 billion currently spent on Pension Credit and £6 billion spent on Housing Benefit for over 65s, so you can see the size of the problem here;
They create, in some cases, high effective marginal tax rates for people who want to earn a little extra income, by removing benefit as income increases;
If a benefit is not universal, there is a danger that the recipients will become so marginalised that their voice is no longer strong enough to defend it, and people might not feel like full citizens of the society they live in. Applying for benefits requires admitting poverty which can be humiliating;
Means-tested benefits are often poorly targeted. The Report of the UN’s Special Rapporteur from 2019 on extreme poverty and human rights, whose recent comments gave me the title for this post, included the following amongst its 11 recommendations: Initiate an independent review of the efficacy of changes to welfare conditionality and sanctions introduced since 2012 by the Department of Work and Pensions;
There are good reasons for people not to want to claim means tested benefits, as the UN report says: The basic message, delivered in the language of managerial efficiency and automation, is that almost any alternative will be more tolerable than seeking to obtain government benefits.
Means-tested benefits cost a lot to administer. The latest National Audit Office guide to the Department of Work and Pensions (DWP) for instance (from 2015-16) indicates the following split:

Of a total budget of £176.6 billion, departmental expenditure in addition to benefit expenditure was £6.3 billion. Attempts to reduce this figure since 2016 appear to have resulted in big increases to under and over payments. Simon Duffy of Citizen Network, who has looked at this extensively and attempted to compare the net benefit to recipients to the total administrative costs including those of the tax system, estimates that, to make people £1 better off, the DWP spends £0.22.

It therefore seems to me that, in order to provide a guaranteed minimum level of living standards in retirement, not dependent upon pensioners being invested in the right way, or filling in the right forms or their employment history, and not vulnerable to the punitive sanctions currently applied to conditional benefits like Universal Credit, we are going to need a state pension somewhere north of 66% above its current level. So how do we pay for it?

How do we pay for it?

My very rough estimate of the amount required to top up everyone below the full state pension in the graph at the top of this post is around an additional 23%.

The current state pension cost around £110 billion pa in 2022-23 or 4.4% of GDP. Allowing for the Pension Credit, Housing Credit and Winter Fuel Allowance at half their current levels following the increase to state pension proposed (a very conservative estimate I believe, which also does not include the smaller increase that those on legacy benefits will need) brings it up to 4.75% of GDP. So what I am proposing would cost up to an additional £73 billion pa in state pension or an additional 2.9% of GDP, or a total of 7.65% of GDP plus the 23% uplift required to top everyone up to the full state pension bringing it to 9.4%, which would put us above the current OECD average of 8% of GDP, although still less than is currently paid by Italy, Greece, France, Austria, Portugal, Finland, Spain, Poland, Belgium, Slovenia and Germany. It is therefore something that we can afford to do in the world’s 5th largest economy if we make this a priority.

These additional payments of around £125 billion would result in immediate increased income tax payments (assuming all at the 20% rate) of £25 billion plus the ONS estimate between 18% and 28% of the poorest 40% of households’ income is spent on indirect taxation, averaging 23% or £29 billion. However, as Richard Murphy has pointed out, there is currently a risk that millions of pensioners will have to complete tax returns (in many cases for the first time) next year due to the triple lock bringing pension levels above the frozen personal allowance. HMRC will therefore need to be reformed so as to be able to collect tax on pensions via PAYE and allow pensioners to receive net pensions in future.

My view is that raising the guaranteed state pension to a level which will be sufficient post tax is preferable to just lifting the personal allowance above the new state pension level. Why? Because:

Everyone would get the new personal allowance, reducing taxation of the wealthiest as well as the poorest, with no particular benefit to the poorest; and
One of my problems with means tested benefits is that they marginalise people so that they do not feel like full members of society. The same applies to not paying tax. If you pay tax, you are more likely to want a say in how that society is organised.

Some options for funding more than the remaining balance of £71 billion, picked out from Richard Murphy’s very conservative estimates here, are as follows:

Ending higher rates of tax relief on pension contributions. This would raise £14.5 billion in tax a year;
Abolishing the VAT exemption for financial services within the UK might raise £8.7 billion of additional tax revenue pa;
Reforming national insurance charges on higher levels of earned income in the UK might raise an additional £12.5 billion of tax revenue pa;
Aligning capital gains tax and income tax rates in the UK might raise more than £12 billion in additional tax a year;
Reforming the administration of corporation tax in the UK might raise at least £6 billion of tax a year;
Abolishing the inheritance tax exemption on some funds retained in pension arrangements at the time of a person’s death might raise £1.3 billion a year;
Reforming inheritance tax business property relief might raise £3.2 billion of tax a year;
Reforming inheritance tax agricultural property relief might raise £1.0 billion of tax a year;
Reforming Companies House might raise £6 billion of tax a year;
Reintroducing close company rules for income and corporation tax could raise at least £3 billion of tax a year; and
Abolishing the domicile rule for tax purposes might raise £3.2 billion of tax revenue a year.

I am sure you would have your own list. And you may not agree with the size of guaranteed state pension increase I have suggested. And I fully admit that these are very approximate figures made to illustrate what might be possible. However I hope I have made a reasonable case for what would be required as a guaranteed income for all pensioners if it were a political priority.

Next month, I will be attempting to tackle the question of why it should be a priority or, in other words, what would be gained by increasing the state pension for all?

A Tale of Two Weekends

08. May 2023 · Write a comment · Categories: Climate Change, Legal, Regulation

If I were John and John were Me,

Then he’d be six and I’d be three.

If John were Me and I were John,

I shouldn’t have these trousers on.

AA Milne

Two weekends, two weeks apart.

In each children spent hours preparing their own personal tributes to the focus of the weekend. Parents arranged accommodation. Face paints were in profusion. Cardboard constructions abounded. There were placards and banners and flags.

One got minute by minute coverage in hushed tones, with talking heads running out of things to say after 6 hours or so and then needing to start projecting what various people, having their every movement and facial tic filmed, might be betraying in a momentary expression. The other one was almost totally ignored, despite both events occupying almost exactly the same space in central London.

Imagine if the media priorities had been reversed:

“And, as the man with the giant mosquito on his head, slowly makes his way around Parliament Square, we reflect on how many hours must have gone into constructing that mighty insect. And now we see the scientists, garbed in their traditional white coats, making the point that no nature means no future. What a riot of colour it is and so many volunteers have given up their time, not only today but in the months of preparation for the Big One. So, Sir David, are you surprised by the number of children in the procession today?” “Not really, Huw…”

“Meanwhile in other news, police arrested a Mr Charles Windsor and his wife Camilla at their home. Police seized several crowns, an orb, sceptres, rings, some very large chairs and other paraphernalia which could be involved in coronation activity. Royalists claimed that the police had been ridiculously heavy-handed. The police said that their actions had been entirely proportionate.”

In Christopher Clark’s new book about the revolutions throughout Europe in 1848, Revolutionary Spring, he talks about the origins of radicals and liberals in opposition to the establishments of the day, divisions which still seem to be with us today. But it is our Government which is radical, prepared to do great violence to the status quo, the opposition which seems to be liberal, bogged down in endless arguments about tiny differences, and the BBC which appears to be left on its own representing what it sees as the current Establishment.

Now there will be many who say that journalists should not be involved in defending any status quo, and I can understand that. However it can also be argued that a state broadcaster like the BBC does have some responsibilities in this respect. But which status quo do you defend?

The Government’s agenda is problematic – it’s not just about the lying and the corruption, but the constant changing of position, the most obvious being the Kwarteng fiscal event in the autumn. Climate protesters are remarkably consistent by comparison, not surprisingly really as the limits imposed by physics are not changing with each quarter. And their focus of sustainability is surely the most critical part of any status quo which needs defending, ie the ability of the planet to support life in all of its forms.

Television is extremely good at focusing our attention on something, and away from something else. This is why companies spend so much on television advertising and why our televised sports halls and pitches and the combatants within them are festooned with logos and messages from a myriad of sponsors. However, the Communications Act 2003 prohibits political advertising, which includes campaigning for the purposes of influencing legislation or executive action by local or national (including foreign) governments. The BBC have interpreted this as not allowing any form of protest to be visible during televised sporting events (most recent example being the Just Stop Oil protest with the orange powder at the World Snooker Championship), an event for which the title sponsor is Cazoo, Europe’s leading online car retailer. Similarly, the police have said that one of the considerations in their level of policing response to the Republic demonstrations this weekend, including pre-arrests before the procession or any protest had taken place, had been the wall-to-wall television coverage of the event.

46% of the UK population are very or extremely worried about climate change, but the biggest demonstration in the UK in the climate movements’s history was not covered on television at all. 62% of the UK population support the monarchy and we get all the main channels turned over to coronation coverage. I think what I am calling for is a bit more balance here, something we used to think, with some pride, was a national characteristic.

We are changing as a country and I am not talking about our satisfaction with the NHS

30. March 2023 · Write a comment · Categories: Climate Change, Regulation

OK I am talking about satisfaction with the NHS a little bit, as it was all over the media yesterday. Just 29% satisfaction compared to 70% in 2010, with the chart above helpfully showing the precipitous decline since then. Does that remind you of another set of graphs I put up not too long ago?

It should. We stopped spending the same proportion of GDP that other similar countries do on their health services and our performance in terms of patient satisfaction plummets. Who would have thought it?

In fact this was only a headline as the Kings Fund and Nuffield Trust had just issued their analysis of the NHS-related bits of British Social Attitudes Survey Number 39, which had originally been published in October, and was itself based on data collected between September and October 2021. However it is an impressive survey overall, with 44,000 households taking part (you can find the full technical details of the survey here).

What is very clear is that the nation is changing fast. Some things are not – a slender majority in favour of increasing taxes and spending more on health, education and social benefits has remained almost static since pre pandemic and all of the averages conceal very polarised views between Brexiteers and Remainers, the different communities in Scotland and Northern Ireland, and particularly between Londoners and the rest of the UK.

This looks like it is beginning to be recognised, with a big increase in the proportion agreeing that working people do not get their fair share of the nation’s wealth (up to 67% compared to 57% in 2019) and, for the first time, a slim majority in favour of moving to proportional representation.

Only 17% say it is very important for being truly British to have been born in Britain, which is down from 48% in 1995, which feels like a sea change in attitudes towards immigration to me.

And then we turn to the environment. Rather echoing the Met Office research I highlighted recently, 45% view climate change as the most important environmental issue, compared with only 19% in 2010, with 40% of the population very concerned about the environment, compared with 22% in 2010.

Which brings us to two climate stories in quick succession.

The first was yesterday, when the Committee for Climate Change, appointed to assess the Government’s progress against its own commitments on climate change, gave its 2023 report to Parliament on England’s progress in building climate resilience across the economy – and the extent of policies and delivery to meet them. It was not a positive assessment.

*Source: https://www.theccc.org.uk/publication/progress-in-adapting-to-climate-change-2023-report-to-parliament/*

What they found was:

There is a striking lack of climate preparation from Government:

Policies and plans. Despite some evidence of improved sectoral planning by Government for key climate risks, ‘fully credible’ planning for climate change – where nearly all required policy milestones are in place – is only found for five of the 45 adaptation outcomes examined in this report.
Delivery and implementation. In none of the 45 adaptation outcomes was their sufficient evidence that reductions in climate exposure and vulnerability are happening at the rates required to manage risks appropriately. For around one-quarter of outcomes, available indicators show insufficient evidence of progress.

Baroness Brown, Chair of the Adaptation Committee, went further:

The Government’s lack of urgency on climate resilience is in sharp contrast to the recent experience of people in this country. People, nature and infrastructure face damaging impacts as climate change takes hold. These impacts will only intensify in the coming decades.

This has been a lost decade in preparing for and adapting to the known risks that we face from climate change. Each month that passes without action locks in more damaging impacts and threatens the delivery of other key Government objectives, including Net Zero. We have laid out a clear path for Government to improve the country’s climate resilience. They must step up.

By coincidence, today is the Government’s Energy Security Day, backed by a report called Powering Up Britain. This follows a High Court ruling last October which found that, when they signed off their carbon strategy, they didn’t have the legally required information on how carbon budgets would be met. The article went on to say:

Ten million tonnes of carbon could be illegally unleashed in the mid-2030s as a result. Doubt was also shed on the 95 per cent of the sixth carbon budget that was accounted for in the government’s estimates.

Mr Justice Holgate also ruled that the strategy breached the Climate Change Act by failing to provide enough detail on the emissions savings, leaving parliament and the public in the dark.

Originally called Green Day, but presumably dropped after Jeremy Hunt’s comments about not wanting to be an American Idiot, the Energy Security Day has highlighted the following Government priorities:

Energy security: setting the UK on a path to greater energy independence.
Consumer security: bringing bills down, and keeping them affordable, and making
wholesale electricity prices among the cheapest in Europe.
Climate security: supporting industry to move away from expensive and dirty fossil
fuels.
Economic security: playing our part in reducing inflation and boosting growth,
delivering high skilled jobs for the future.

Further analysis at this stage has not been made easy by the way that the Government has released details. Chris Stark, the Chief Executive of the Committee for Climate Change has described it on Twitter as “government by press release”, ie

The government now adopts this communications strategy regularly: press release the night before – published documents later. It gives them two bites of the press coverage.

But it makes it hard for a statutory organisation like @theCCCuk, with legal duties, to comment.

Others have been less constrained in their response. The main criticisms are that many of the policies presented in the report have been announced previously, that there is no significant increase in support for home insulation and that the focus on carbon capture and storage (CCS) is out of all proportion given the long-standing difficulties of scaling up the technology.

The BBC quote Bob Ward, policy director at the Grantham Research Institute on Climate Change at LSE:

What does not make sense is to carry on with further development of new fossil fuel reserves on the assumption CCS will be available to mop up all the additional emissions.

I had an initial skim of the report looking for what was planned for heat pumps, which regular readers of this blog will know I have some history with. I found this:

The Government has an ambition to phase out all new and replacement natural gas boilers by 2035 at the latest and will further consider the recommendation from the Independent Review of Net Zero in relation to this. People’s homes will be heated by British electricity, not imported gas. The Heat Pump Investment Accelerator will mean heat pumps are manufactured in the UK at a scale never seen before. We want to make it as cheap to buy and run a heat pump as a gas boiler by extending the Boiler Upgrade Scheme by three years, and by rebalancing the costs of electricity and gas.

So reading between the hype, they are going to invest £30 million in heat pump manufacture in the UK, which they claim will attract £270 million of “private investment into manufacturing and associated supply chains”.

The other parts are:

Committing to extending the £5,000 grant for another three years (which is less than the difference between the cost of installing a heat pump and a gas boiler currently in many cases, although this may change if schemes like the recently announced Octopus pilot become more widely adopted).
The “Clean Heat Market Mechanism” which is supposed to encourage the installation of low carbon heating appliances.
A consultation to shift green levies off electricity and on to gas bills.

The country is changing fast. The Government needs to be more transformational than this to keep up. Or, in Baroness Brown’s words, step up!

Day 2 of the UCU Strike: Never explain; never regret; never apologise

09. February 2023 · Write a comment · Categories: Economics, Regulation

*Source: https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp*

As we arrive at the second day of UCU strike action, we move from the industrial austerity discussed in my last blog to monetary austerity. With the latest rise in the Bank of England Base Rate to 4%, it also seems timely to consider the history of Bank of England independence.

Go to the Bank’s own website and you will find all the presentations from a 20 years on celebration of its independence from 2017. Ian McCafferty, External MPC Member at the Bank of England, gave a speech in 2017 about the circumstances of its introduction. The main reason given for the change was credibility of monetary policy.

But is this history entirely accurate? The Brussels and Genoa economic conferences of 1920 and 1922 (previously referred to here, and, as in the previous piece, the source of most of the next couple of paragraphs is from Clara Mattei’s excellent The Capital Order) first introduced the idea of central bank independence from democratic control as something desirable (before World War I, the Bank operated much more as a commercial bank and was the only limited-liability corporation allowed to issue bank notes, which gradually became a monopoly power). As Ralph Hawtrey, a senior economist at the UK Treasury of the time, said, the Bank of England should follow the precept: “Never explain; never regret; never apologise”.

The main reason formal independence does not appear to have been sought in the UK at the time, was that it was unnecessary. Montagu Norman was Governor of the Bank of England from 1920 until 1944, but was very close ideologically to Basil Blackett and Otto Niemeyer, who effectively ran the Treasury during those years. For example in 1927, the Governor of the Bank of France, Emile Moreau, relayed the opinion of the French Ambassador to London at the time: “Winston Churchill [Chancellor at the time]…isn’t really in control of the Treasury. The man who does in fact control it is Sir Otto Niemeyer, the intimate friend of M. Norman”.

The result of this was technocratic control of monetary policy, with politicians unable or unwilling to challenge the Bank or the Treasury. So, when Neville Chamberlain was Chancellor in March 1921, he said that: “the price of money is wholly outside government action”. Similarly, in March 1925 when Winston Churchill was Chancellor, he said that: “I think it would be an inconvenient practice if the Chancellor of the Exchequer were to set the precedent of expressing approval or disapproval of decisions taken at any time by the Bank of England”.

This was despite what, to at least some technocrats, must have been a terrifying increase in the electorate at the end of World War I – the size of the electorate tripled from the 7.7 million who had been entitled to vote in 1912 to 21.4 million by the end of 1918 as a result of the Representation of the People Act of February 1918. This gave the vote to 8.5 million women for the first time (those aged 30 or above and subject to some property requirements) and extended the male franchise to a further 5.2 million (all men over 21 if they were willing to serve British rule).

Technocratic rule ended following the 1945 General Election, when the new Labour Government nationalised the Bank, and the call for an independent central bank only really gained ground in 1992 when it was included in the Liberal Democrat election manifesto in that year. We might perhaps have expected this to have been brought in earlier alongside the change in direction towards monetarism under Margaret Thatcher in 1979. Milton Friedman was probably the best known advocate of monetarism at the time, but Friedman rejected central bank independence on the basis that it would be a bad idea “in a democracy to have so much power concentrated in a body free from any kind of direct, effective political control”.

So, viewed in that way, central bank independence can be viewed as the normal state of affairs, and the 52 years between 1945 and 1997 as the anomaly. One thing that is clear is that central bank independence makes monetary austerity much easier. As Gerard Vissering said at the Brussels Conference of 1920 about central bank independence: “A national or municipal government might possibly be powerless against such pressure on the part of the employees, because the latter can make their political influence felt on national government.” He went on, “…[a]n independent banking institution need not however allow itself to be led by the nose by any power whatsoever exercised by the employees”.

So central bank independence can be seen to be as much about political control as economic management. As McCafferty says, it was introduced for credibility. But credibility with who? Other governments following the same consensus is one answer and the financial markets probably another. There is also the argument about managing expectations within the domestic economy, another form of credibility – ie if people expect monetary policy to be unbending in pursuit of its inflation target, there is no point hoping that this will not be pursued, and therefore the forces pushing up inflation will dissipate sooner (and therefore, the argument is, you actually need generally lower interest rates to achieve your aim). Let’s call it the crushing of hope policy.

This argument does of course depend on the technocrats knowing best. However, as Martin Wolf wrote in the FT about Gordon Brown in May 2010:

...it is far too easy to blame him alone for the UK’s current plight. The truth, I would argue, is that his biggest error was to believe in the conventional wisdom about the prospects for durable economic stability, the robustness of modern financial markets and, surprisingly perhaps, the strength of the post-Thatcher UK economy.

As Blair Fix has pointed out here, increasing interest rates to control inflation looks more like a faith position than one based on much evidence in many cases. How many politicians would be prepared to die on the monetary austerity hill if the central bank were ever to lose its independence again?

Next time: fiscal austerity.

Day 1 of the UCU Strike and it feels like a class war entirely manufactured by the Government

01. February 2023 · Write a comment · Categories: Actuarial, Legal, Regulation

Hundreds of thousands of public sector workers were on strike today. I was one of them. Meanwhile the Bill above is making its way through Parliament – it was voted through earlier this week by all but one of the Conservative MPs, but is currently getting rather more scrutiny and push back in the House of Lords.

It seems likely that there will be legal challenges to some elements of the Bill and that some of them will be successful. The Labour Party have promised to reverse it if they win the next election.

I spent my first strike day ever (yes, I know, I am just a political union member and a mere picket tourist – all of these criticisms are entirely justified) by attending a meeting of the Leicester Actuarial Science Society with the Institute and Faculty of Actuaries (IFoA) President Matt Saker. It was a very well attended event and there were a lot of questions for Matt. These ranged from the IFoA strategy in Africa, to mutual recognition agreements with the Institute of Actuaries in India to the pros and cons of the recent vote to create a Chartered Actuary status for associates and fellows to the future relationship of the profession to AI applications, reflecting the global nature and broad range of interests of the student audience. I felt very much like I was witnessing the next generation of actuaries getting stuck into the issues that would be important to them through their careers, and it was inspiring to see.

Back to the strike. I differ from many of the strikers interviewed in that, in my view, I was not doing anything particularly altruistic by striking. I was standing up for my own pay and conditions. Which, it seems to me, everyone should be able to do in a free society. Years of anti union legislation, uberization and the growth of sectors with weak unions has made us used to having to negotiate for ourselves individually or in small groups against much more powerful employers. The fall in real pay over the last 12 years indicate that this has not really worked for us and perhaps a new era of collective bargaining is now necessary.

Meanwhile the Government thinks that it is a better idea to muzzle unions and repress future strike action than to deal with any of the grievances of the workers they represent. They think this is a better idea than to build anything, invest in anything, or do anything positive at all. You have to ask who such a move, temporary and largely struck down as illegal as it is likely to be, is designed to impress: future party donors perhaps?

The next generation I saw today did not strike me as one which will have much patience for such manufactured class wars and the governments which manufacture them.

It is my hope and, after today, my belief that they will think we have more important things to be doing.

Trade unionism: my part in its downfall (with apologies to Spike Milligan)

13. January 2023 · Write a comment · Categories: Economics, Legal, Regulation

Source: Department for Business, Energy and Industrial Strategy *Trade Union Membership, UK 1995-2021: Statistical Bulletin*, 25 May 2022

It all began for me on 23 September 1985, the first day in my first graduate role as a management trainee at the home counties factory of a security printing firm. From the beginning I was left in no doubt by my new employers that the fairly powerful print unions at the time (SOGAT and the NGA) were the biggest impediment to the captains of industry within the firm from running the business successfully. Occasionally I was allowed into management meetings, where all of the things we could do if it wasn’t for the unions were discussed endlessly.

During my time in this first role, the printing industry changed dramatically: the typesetting was computerised, massively reducing the number employed virtually overnight and Rupert Murdoch set up his non-unionised newspaper factories at Wapping. There had already been three pieces of trade union legislation in the 1980s by the time I started work, the latest being the Trade Union Act of 1984, which required secret ballots for union elections and strikes rather than the show of hands which had been possible up until then. The Miners Strike had also only just ended in March 1985, which had a devastating impact on the trade unions more generally.

Further legislation now quickly followed:

the Public Order Act 1986 (which introduced new offences related to picketing, and increased police powers over protests involving groups of 20 people or more);
the Wages Act 1986 (which reduced many of the restrictions on employers fining and deducting money from employees’ pay, removed statutory holiday entitlement and reduced state funding for redundancies);
the Employment Act 1988 (which gave workers the right to not join a union, and trade union members the right to challenge strike ballots);
the Employment Act 1989 (which restricted trade union officials’ time off for duties and abolished government support for redundancy payments);
the Employment Act 1990 (which finally removed the closed shop – ie a workplace where union membership was compulsory – and secondary action protection);
the Trade Union and Labour Relations (Consolidation) Act 1992, which consolidated the legislation of the 80s and 90s, while clarifying that the right to take strike action was protected when it was “in contemplation or furtherance of a trade dispute”; and
the Trade Union Reform and Employment Rights Act 1993 (which gave trade unions a duty to inform employers of upcoming strikes).

This would appear to have given my first employers everything they could have wanted in terms of containing union power but, after some retrenchment in the 1990s owing to the incoming Labour Government taking the UK back into the Social Chapter of the Maastricht Treaty (which we had originally opted out of in 1992) in 1997, there was further legislation in the form of the Trade Union Act of 2016, which, amongst other measures:

introduced a new requirement of 50% of union members to vote in a ballot for strike action;
required that workers in important services (health, school education, fire, transport, nuclear decommissioning and border security) must gain at least 40% support of those entitled to vote in a workplace for a strike to be legal;
required two weeks’ notice of industrial action to be given to an employer (the employer can agree to one week);
limited the right to take industrial action after a strike ballot to six months, or nine months if the employer agrees.

Over the period since 1985, wealth inequality, which had been steadily reducing since at least the end of World War I stalled and has been generally on a slightly increasing trend since:

Source: Resolution Foundation *The UK’s Wealth Distribution*, December 2020

And the position with respect to income inequality is even worse, with the UK having the 9th worst income inequality of the 38 countries in the OECD:

Source: *Income inequality in the UK*, House of Commons Library, 30 November 2021

However, perhaps this was a price worth paying, if the forces of creativity and entrepreneurship had at last been allowed full rein, freed from the stifling dead hand of union power? Unfortunately not (TFP stands for total factor productivity in the graph below):

Source: *The UK Productivity “Puzzle” in an International Comparative Perspective*, Fernald and Inklaar, April 2022

So whatever, the continuing problems of UK PLC, it does not look like union power was ever really one of the major ones. Undeterred, the Government is proposing further restrictions on trade unions and their members, including enforcing minimum service levels during strike action for ambulance staff, firefighters and railway workers and requiring some employees to work during a strike under threat of being sacked if they refuse.

The TUC has made a submission to the International Labour Organisation of the United Nations over what it sees as breaches of Conventions 87 (Freedom of Association and Protection of the Right to Organise) and 98 (Right to Organise and Collective Bargaining). As David Allen Green has blogged:

But regardless of your view on the ultimate rights and wrongs of strikes by public sector and other public service workers, there is something fundamentally objectionable in the current government’s proposals to compel certain “key” workers to attend work when they otherwise would be entitled to strike….Simply prohibiting other key workers from being able to strike, without sufficient alternative entitlements and arrangements to balance this loss of a right, is misconceived and illiberal.

It is an authoritarian gesture, rather than a solution to a problem.

Roy Lilley (at the Institute of Health and Social Care Management) in a postscript to a recent blog, focused on what a strategic failure the proposals represent within the NHS industrial dispute:

HMG plans, to ban strike action by some public workers is a further example of ‘push-back’ management. Push the disputes into the courts instead of dealing with the root-cause of strike action, improve industrial relations and representation.

So what has my part been in the downfall of trade unionism to date? In my first job, other than an abortive attempt to develop a new shift pattern(!) for the security guards in the factory, I had few skirmishes with union leaders compared to those with my management colleagues. In the finance sector, where I spent most of the middle 20 years of my working life, I rarely came across any staff representation at all. As a school teacher I joined the ATL rather than the NUT (they have since merged to form the National Education Union) due to its reputation for being determinedly non-militant. And, in my current role, I rather flounced out of the UCU over a difference of opinion over the pensions dispute raging at the time.

So I have not been a very good supporter of trade unionism over the years. However it now seems clear to me that the industrial austerity (ie the crushing of labour power within the economy, further discussed here) described above during my lifetime has been a political rather than an economic project all along. None of the economic justifications given for it since the 1980s have been borne out and the unopposed rugby of industrial management we have increasingly witnessed since has resulted, in my view, in poorer outcomes than if the 99% had been consulted regularly.

I sense that the current Government will only be satisfied when trade union membership levels fall to zero. So if, like me, you don’t want that to happen, the time to push back against running the economy at all times exclusively in the interests of the owners of capital is now.

I have rejoined the UCU.

Democratising the Lathe

21. October 2022 · Write a comment · Categories: Cartoons, Economics, Regulation, Science Fiction

I have been thinking a lot about Ursula K Le Guin’s The Lathe of Heaven over the last few weeks, a book I would highly recommend at any time but particularly at the moment. It is the story of a man, George Orr, who can change reality by dreaming. An ability that terrifies him. He is caught taking unprescribed drugs to try and prevent himself dreaming and as a result is sent for a “voluntary therapeutic treatment” with Dr William Haber, a dream specialist. Haber has built a machine called the Augmentor to make it easier for his patients to have dreams directed by him. He starts to work with Orr, becoming increasingly impatient with Orr’s version of the directions Haber is giving to his dreaming in the machine, until eventually Haber dispenses with Orr and connects himself to the machine instead.

Every time reality is changed it is as if it has always been changed. The changes become increasingly dramatic and disruptive until a peak of general insanity now referred to by all as The Break:

All over the world the various gods were being requested, more or less politely, for an explanation of what had occurred between 6.25 and 7.08 pm Pacific Standard Time.

But what the book really focuses on are George’s desperate attempts to live in this increasingly unhinged reality, as the only person (apart from Haber) aware of the abrupt changes swinging it around, and to hang onto the one person, Heather Lelache (or Andrews in the final version of reality they arrive at), he has ever loved.

One of the sentences on the last page (when he finds out that she has married) has stayed with me in particular:

He stood and endured reality.

However hilarious some of the moments of the last few days have been (and let us not forget some of the highlights here, here and here), we are all going to have to endure some significantly altered reality over the coming years as a result, from the moron risk premium to the cost of living crisis slowly rippling through all aspects of life, at a time when we already have a climate emergency and other planet-wide issues we need to be dealing with. There are many arguments to be had about the best way to tackle all of these problems, and I intend to throw myself fully into those arguments.

However, I would propose that we have to prioritise ensuring that, as a society, we never ever again let the lone mad scientist or economist or politician or former talk show host or indeed anyone else, whoever or however charismatic they are, take over sole control of the machine.

I think we need to do three things to achieve this, before we start to argue over policy:

Adopt proportional representation in parliamentary elections. We have got to broaden the support for whoever is in power, rather than stick with the current system which focuses on a tiny number of people in marginal constituencies and ignores pretty much everyone else. Make Votes Matter have agreed a cross-party document (which I have signed) called the Good Systems Agreement. This sets out the options on voting systems to replace first past the post and the best way of getting there. More about what is wrong with our current system (from the Electoral Reform Society) can be found here. Never again should there be a small cabal of people (like this weekend) deciding on who runs the country – with a steadily shrinking selectorate as their ability to achieve consensus on anything dwindles with every successive decision. We no longer have a system in the UK that can make important decisions and the answer is not more technocracy (leaving it to the so-called clever people, however foolish they may be) or plutocracy (leaving it to the rich), it is more democracy, ie including all of us in the decisions we will have to live with.

Reform media ownership and promote plurality in support of a more democratic and accountable media system. The Media Reform Coalition has produced a manifesto for a people’s media which I support: it includes proposals for an Independent Media Commons – with participatory newsrooms, community radio stations, digital innovators and cultural producers, supported by democratically-controlled public resources to tell the stories of all the UK’s communities. This will allow a much greater range of ideas to be presented to the public and discussed than the current Overton window (see below) and greatly improve our national debate about the things that matter.

Reform election finance. Recommendations for doing this were provided in the July 2021 report by the Committee on Standards in Public Life, with 47 recommendations following a comparison of political and electoral finance regulation in 12 countries (Australia, Canada, Denmark, Finland, France, Germany, Ireland, the Netherlands, New Zealand, Norway, Sweden, and the USA), the majority of which are around reforms to campaign practices, meeting emerging threats around the source of donations, delivering greater transparency and enhancing compliance with election finance law.

We have big problems to solve in the UK and we need everyone to be able to contribute if we are going to solve them. However currently:

Our votes are counted in a way which effectively wastes most of them;
The information we receive about politics is fed to us through a very partial sieve controlled by a small unrepresentative group of people whose vested interests effectively define our Overton Window; and
Influence and access to power often appear to go to the highest bidder rather than the best ideas.

All of this needs to change whoever is Prime Minister in the coming weeks, months and years.

We Know Zero