Jun 19 2013

The government adopted tax campaigners’ rhetoric at the G8, but much of the status quo is still intact

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s200_martin.hearsonMartin Hearson argues that whilst David Cameron will receive a significant political boost from the media portrayal of his global leadership on tax evasion, nothing agreed at the G8 is in itself likely to make a big difference to tax haven secrecy or to developing countries. Importantly, there were no commitments on public registers for beneficial ownership.

The Enough Food for Everyone If campaign – successor to Make Poverty History – has succeeded in making tax haven secrecy the centrepiece issue of public debate around the G8 summit, which closed yesterday in Eniskillen. It also chalked up a genuine success, in pushing the UK’s overseas territories to join a multilateral initiative to share tax information.

But what emerged from the summit itself (and indeed, what David Cameron proposed ahead of it) was a set of ten ‘principles’, with no concrete commitments beyond endorsement of developments already taking place through the G20 and OECD. “The public argument for a crackdown on tax-dodging has been won but the political battle remains,” said the IF campaign. This outcome is not illogical, because competency on tax most definitely resides with those other organisations, rather than the G8. Indeed, some of the developing countries in the G20 would likely bristle if asked to implement a decision taken by the G8.

Over the past few days, it became increasingly difficult to distinguish the campaigners’ messages from those coming out of the government. This demonstrates a real success on the part of campaigners in shifting the public debate. As Melanie Ward, of development charity ActionAid and the IF campaign, wrote yesterday, “at points it was bizarre watching David Cameron, the UK prime minister, use language that could have been written by those working in development agencies.”

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Jun 19 2013

Why the government’s Help to Buy scheme won’t reach the right people

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robbie_de_santosTobyLloydThe government’s Help to Buy scheme intends to boost homeownership by reducing the down payment required. Analysis by Robbie de Santos and Toby Lloyd of Shelter, also detailed in a report launched today, shows that overall affordability is a bigger problem than the big deposits required by mortgage lenders. Easy finance into a supply constrained market can only boost up house prices, pushing them further out of reach for the millions of lower and middle income households already frozen out of the housing market. 

When the government launched the Help to Buy scheme in the budget back in March, it was couched in the terms ‘aspiration nation’. A cornerstone of which was about helping people achieve ‘that most human of aspirations’: owning a home. It’s not hard to see why the government are focusing on this. In the last decade, homeownership has declined for the first time since records began. That most human of aspirations has started to look wholly unachievable for most hard working families.

They are mostly renting from a private landlord now – there are now nine million people in the private rented sector, which has grown by 69% in the last decade. Renters have to grapple with a market dominated by short tenancies (in some places 6 months is the norm), high rents and big increases (people paying an extra £300 rent this year compared to last), meaning that more than half of renting families can only save £50 or less a month. For families in particular – 1.3 million of them, a third of the sector – the lack of stability and predictability can be a nightmare. 44% of renting families think their children would have a better childhood if they weren’t renting.

Importantly and as we’ve highlighted, renters are looking ever more like the archetypical swing voter – their incomes cluster round the median, they are more likely than any other group to be in full time work, and they are really, really feeling the squeeze. This is a key living standards issue, which is why influential think tanks like the Resolution Foundation are also looking at solutions for generation rent.

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Jun 18 2013

A postgraduate loans system is critical to social mobility

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annika_olsenDespite the increasing value of postgraduate degrees, there is no loan system equivalent to that for undergraduate students available to postgraduate students. This means that many are unable to access adequate funding and have to resort to potentially disastrous measures to get by. Annika Olsen discusses the recent IPPR report detailing a loan system that makes fiscal sense and addresses the issue.

This month saw the publication of yet another report on the social mobility crisis in postgraduate studies, this time from the liberal thinktank Centre Forum. The report echoes a chorus of other organisations calling for a fairer funding system for postgraduate studies, including the NUS, the Policy Connect HE Commission, and the 1994 Group. Indeed, as the report by the Policy Connect Commission points out, postgraduate study is increasingly seen as the ‘new frontier in widening participation’ to higher education, with the former social mobility tsar Alan Milburn calling it a potential ‘social mobility time bomb’.

There are good reasons for these alarming statements. First, there are significant wage gains associated with doing a postgraduate degree compared to doing an undergraduate degree. As Lindley and Machin point out in the CentreForum report, the wage gap between postgraduate degree holders and first degree only degree holders increased from 7% in 1996 to 14% by 2010. Elsewhere they state that across the whole education spectrum, graduates with a postgraduate degree have seen the biggest wage gains in the past two decades. Second, a postgraduate degree is increasingly seen as a requirement for employment in a number of sought-after professions, such as law, engineering, and biotechnology, as well as journalism, accountancy and academia.

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Jun 18 2013

Waiting for the Great Recession train to crash: How the poorest are about to be hit the hardest, and how we can prevent this

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Karen Rowlingson thumbKaren Rowlingson argues that the unprecedented reforms to the social security system are set have the greatest impact on the most vulnerable in society. Recent data shows that two-thirds of children in poverty are living in working families, suggesting that work clearly isn’t working as a route out of poverty and that the tax credit/benefit system is playing a major role in supporting people in work. We not only should maintain a strong welfare system but also need to take a fundamental look at the nature of our market economy.

The UK economy went off the rails in 2008 with a massive increase in unemployment, particularly for younger people. But the social security system did its job, to some extent, enabling many to avoid the worst consequences of recession. Various welfare reforms introduced or enacted since then, however, will now mean that the poorest will see their incomes hit the hardest. The train is about to crash unless we abandon the reforms and re-build a system which provides effective social security for all.

The IFS has confirmed that the current downturn is the longest and deepest slump in a century and while the better-off were hit hardest by the recession initially (due to falls in earnings), the impact of the recession is now set to hit the poorest hardest (due to cuts to the social security system). Figures released by the Office for National Statistics already show that there were nearly a million more people in absolute poverty in 2011/12 compared with 2010/11 and the IFS estimate that there will be over a million more children in poverty by 2020. The main reason why the poorest will be hit hardest in the next few years is that unprecedented changes to the social security system will begin to bite. These reforms include the following:

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Jun 17 2013

The burning hole at the heart of the G8 agenda. Why was climate change marginalised at the 2013 G8 summit?

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Robert_FalknerDavid Cameron’s decision to not even mention the climate change challenge in the official G8 agenda has ruffled many feathers. Robert Falkner notes that the UK government now seems content to let others do the heavy lifting in support of a new global climate accord, despite its longstanding claim to a leadership role in climate politics. Leaving climate change off the agenda is further evidence that the Tory right is making inroads into the coalition government’s environmental agenda.

“Baffling” and “irresponsible” were some of the words used to describe the British government’s decision earlier this year to leave climate change off the agenda for the 2013 G8 Summit. When the leaders of Canada, France, Germany, Italy, Japan, Russia, USA and UK meet at a golf resort in Lough Erne in Northern Ireland on 17 and 18 June, they will instead focus on a slimmed down agenda consisting of trade, tax and transparency. Climate change, alongside poverty eradication, may still end up being discussed in the margins of the meeting. But with the conflict in Syria set to dominate bilateral conversations particularly between David Cameron and Barack Obama, the G8 is unlikely to inject fresh momentum into the current efforts to reach a global climate agreement by 2015.

To be sure, the three T’s of the Lough Erne agenda are worthy topics for global discussion, and priorities inevitably change every time the G8 Presidency is passed on. The British Prime Minister has invested considerable political capital in a deal on tax compliance and transparency, mindful of the gathering public storm over multinationals slashing their tax liabilities thanks to an abundant supply of legal loopholes and tax havens. But David Cameron’s decision not even to mention the climate change challenge in the official agenda has more than just ruffled environmentalists’ feathers. Both France and Germany are said to have tried but failed to get the British government to change its mind. They will struggle to make a difference at the meeting itself.

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Jun 17 2013

David Cameron is unlikely to get the results he wants out of the G8 Summit

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chrisbrownThis morning sees the start of the G8 Summit, hosted by David Cameron and taking place at a golf resort in Northern Ireland. Chris Brown argues that the government will not get what it desires out of the meetings. Agreements on trade, tax and transparency are unlikely and, though the ongoing Syrian conflict will figure prominently in informal discussions, he believes Obama does not intend to intervene beyond sending small arms shipments to the rebels. On the bright side, the very fact that the meeting could take place in Northern Ireland says something very important and encouraging about the changes that have taken place there.

The G8 is a group of the leading developed economies – Canada, France, Germany, Italy, Japan, the USA, the UK and, since 1997, Russia. In addition the EU is represented at G8 meetings by the Presidents of the European Council and the European Commission. The G8 has no formal bureaucracy, and its members (other than the EU representatives) take turns in acting as President – the UK has held the Presidency since Jan 1st and will host the annual meeting of G8 leaders to be held on 17 – 18 June at the Lough Erne Hotel near Enniskillen in Northern Ireland.

G8 meetings are only rarely exciting occasions; usually the demonstrations that invariably accompany them are the most interesting story they produce. However, the last Summit hosted by the UK in July 2005 was the exception to this rule; it began with then prime minister and host Tony Blair arriving late on the back of his triumph in gaining the 2012 Olympics for London, continued with Bono and Bob Geldof ‘Making Poverty History’ and ended with Blair leaving early to preside over the aftermath of the 7/7 bombings. David Cameron will be hoping for rather less excitement this time; certainly there will be less pointless celebrity politics.

The G8 Presidency gives the host government the opportunity to press issues that it thinks important, both at the Summit itself and at the meetings that precede and follow it, meetings such as the ‘Nutrition for Growth’ Conference that took place in London on Saturday 8th June. For the actual Summit, the UK government has declared three issues to be crucial: advancing trade, ensuring tax compliance and promoting greater corporate transparency. Each is likely to be problematic and may backfire on the government.

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Jun 16 2013

Book Review: A Life in Education and Architecture: Mary Beaumont Medd

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This book seeks to provide a detailed exploration of the relationships between individual architects, educators, artists and designers that laid the foundation and shaped the approach to designing new school buildings in postwar Britain. It explores the life and work of Mary Medd, one of the most important modernist architects of the 20th century. Kerwin Datu finds that this biography falls short in some places but is historically valuable when we compare Medd’s ideas with the current state of British education.

A Life in Education and Architecture: Mary Beaumont Medd. Catherine Burke. Ashgate. December 2012.

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Mary Beaumont Medd (née Crowley; 1907 – 2005) was a Bradford-born architect who devoted her career to the reform and planning of primary, secondary and nursery schools in the postwar years, one of a number of progressive figures in the field of British education during this period. She is the subject of a biography by Catherine Burke, senior lecturer in history of education at the University of Cambridge.

Medd’s father was Ralph Henry Crowley, a medical officer heavily involved in child health and welfare and a pioneer of the open air schools movement in England, and both father and daughter shared the habit of travelling widely and regularly to study the most innovative learning environments being planned throughout northern Europe and the US.

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Jun 16 2013

Book Review: The Fanaticism of the Apocalypse

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The planet is sick and human beings have to pay. Today, that is the orthodoxy throughout the Western world, and our ecological catastrophism is turning us into cowering children, writes Pascal Bruckner. Rather than preaching catastrophe and pessimism, Bruckner argues that we instead need to develop a democratic and generous ecology that addresses specific problems in a practical way. Amelia Sharman finds this philosophical work a frustrating read for the ways it ignores the large body of climate science on the significant detrimental impacts to many areas of the world.

The Fanaticism of the Apocalypse. Pascal Bruckner. Polity. April 2013.

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The most recent in a series of books examining fear and guilt, The Fanaticism of the Apocalypse is the newest publication from Pascal Bruckner, a French philosopher who rose to notice during the 1970s as part of the anti-Marxist ‘new philosophers’.

Offering a ‘take no prisoners’ attack on what he terms the “ecology of disaster” (p.184), Brucker argues that the dominant theme of contemporary environmentalist discourse has become that of an inescapable environmental catastrophe with a central aim to instil fear into the hearts of the masses. As the fear of communism has collapsed, our new adversary is ourselves, as we become framed as the enemy of nature.

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