Written evidence submitted by the Carnegie UK Trust (LRS0037)

 

The Carnegie UK Trust welcomes the opportunity to respond to the Business, Energy and Industrial Strategy Committee inquiry on post-pandemic economic growth. 

 

The Carnegie UK Trust is an independent foundation that seeks to improve the wellbeing of the people of the UK and Ireland by investing in evidence, policy and practice development. Our Strategic Plan (2016-2020) takes a holistic approach to wellbeing and outlines our work as focusing on ‘Enabling Wellbeing’; ‘Flourishing Towns’; ‘Fulfilling Work’; and ‘Digital Futures’.

 

We have responded to the consultation questions most relevant to our knowledge and expertise. These are:

  1. What core/guiding principles should the Government adopt/prioritise in its recovery package, and why?
  2. Whether the government should give a higher priority to environmental goals in future support?
  3. How should regional and local government in England, (including the role of powerhouses, LEPs and growth hubs, mayoralties, and councils) be reformed and better equipped to deliver growth locally?
  4. What opportunities does this provide to reset the economy to drive forward progress on broader Government priorities, including (but not limited to) Net Zero, the UK outside of the EU and the ‘levelling up’ agenda?

Response

 

  1. What core/guiding principles should the Government adopt/prioritise in its recovery package, and why?

AND

  1. Whether the government should give a higher priority to environmental goals in future support?

 

Proposition 1: The UK Government should reset its priorities towards delivering national wellbeing

 

The UK Government currently prioritises economic wellbeing over social and environmental wellbeing. While for much of the twentieth century economic wellbeing could be seen to create social wellbeing, the link between economic and social wellbeing broke down in the later part of the century; pursuing economic growth as an end it itself no longer automatically provides for increases in social wellbeing. At the same time, the environmental cost of pursuing economic growth as an end in itself are becoming clearer.  

 

Internationally, governments are beginning to implement new approaches. These new models have different names - wellbeing, sustainable development, new economies, green economies. During the COVID-19 pandemic there have been calls to replace the existing, GDP based growth model with a more balanced approach. While the language varies, most calls for a ‘new narrative’ share key elements:

        Balancing economic, environmental and social outcomes 

        Long-term planning

        Addressing inequalities 

        Building resilience

 

The core message of all wellbeing approaches to government is the need to rebalance economic, environmental and social outcomes, and to provide a mechanism for making trade-offs between different domains of wellbeing.

 

Our UK and international evidence shows that this approach can:  

        Provide strong leadership by creating an aspirational but achievable vision for society.

        Make sense of complexity by bringing information from across the system into one place.

        Support joined-up government through a shared analytical framework.

        Provide a framework for debating trade-offs between different outcome areas, making decision-making and spending more transparent.

        Inform policy development by providing information on inequalities across wellbeing domains, helping identify structural issues for specific people or places who risk being left behind.

        Catalyse citizen engagement by giving people an opportunity to express their priorities and subsequently to see whether governments are making progress towards these. 

 

We strongly recommend that the Committee adopt a wellbeing approach to its consideration of post-pandemic economic growth. To do this effectively, governments should:

 

 

 

 


Proposition 2: The UK Government’s recovery package should commit to examining the role that good work can play, alongside job creation, in the economic and social recovery from the crisis

 

Our personal, community and societal wellbeing are all affected by work. The availability of work is of critical importance, but so too is the quality of work we experience. Work can impact on our wellbeing by providing an income, giving a sense of purpose and identity, building social connections and offering personal agency.

 

A wealth of evidence suggests that decent pay is of foundational importance, especially to those on the lowest salaries. However, job quality is about more than just about earnings, with most workers valuing and gaining wellbeing benefits from other aspects of their work. Other examples of good work might be that it that offers a secure contract, protects and supports health and safety at work, offers genuine two-sided flexibility and training and progression opportunities.  In 2018, the Carnegie UK Trust and RSA convened a cross-sectoral Measuring Job Quality Working Group, which produced a framework for measuring job quality across 7 key dimensions.

 

We recognise the economic, societal and individual wellbeing costs of unemployment, particularly at the potential scale caused by COVID-19. Given the severity of the recession, the extent of scrutiny placed on quality of work will need to be balanced against other related and legitimate policy goals such as minimising unemployment. However, while being unemployed is highly damaging to wellbeing, being employed in poor quality work also has significant negative impacts. Moreover, international analysis of levels of employment quality and quantity suggests there is no trade-off between the two.

 

The best possible jobs recovery, which will support public health, a more sustainable economy and improve social cohesion, must include a focus on promoting good work.  We recommend that the UK Government builds the following principles into its recovery package:

 

 

 

 

 

  1. How should regional and local government in England, (including the role of powerhouses, LEPs and growth hubs, mayoralties, and councils) be reformed and better equipped to deliver growth locally?

AND

  1. What opportunities does this provide to reset the economy to drive forward progress on broader Government priorities, including (but not limited to) Net Zero, the UK outside of the EU and the ‘levelling up’ agenda?

Proposition 3: Reimagine the local as a place with real power to deliver economic, social and environmental wellbeing

 

As the Committee will be aware, the UK is one of the most centralised states in the world. Devolution in England is incomplete and the patchwork of devolution deals mean that some deals relate more to administrative convenience than a sense of community and belonging, with a corresponding low level of expectation from the public. In our 2017 work with the British Academy on Governing England the need to connect devolution of powers with regional identity was raised repeatedly. These expert roundtables also highlighted the need for greater fiscal powers to be devolved to combined authorities in order to meet the policy expectations set for them.

 

It is only with these greater powers that devolved administrations in England can begin to address the social, economic and environmental wellbeing of their populations. We know many aspire to this greater set of powers and responsibilities, for example with Liverpool City Region recently joining the international Wellbeing Economy Alliance.

 

Greater powers for combined authorities should only be the start of a new central-local relationship. Within devolution deals we would like to see much greater attention given to sub-local authority areas. In the UK, two out of five people live in towns, and yet there continues to be an evidence gap in the importance of towns and communities to our wellbeing, with a national focus on cities and city deals. Our 2018 report on Brexit and Towns by Professor Duncan MacLennan concluded that there is an unacceptable, casual blindness to towns in spatial policy-making. Few of the existing city deals have explicit economic strategies for the towns that lie within city regions and have no audit of or interest in the towns that lie in the broader hinterland, sometimes lying between two separately defined city regions.

 

In towns located within, and between, growing metropolitan regions there had been a sustained state failure in managing the growth of economic infrastructure, including homes, and services, that arguably hampers productivity growth and raises inequalities. That has not simply, or necessarily, been a matter of sluggish local planning decisions but reflects decades of failure to expand infrastructure and service provision.

 

Despite more than three decades of regeneration and renewal programmes, many of the towns that had seen their traditional economic bases disappear in the 1980’s, still persist as major locations of disadvantage. Many of the older industrial areas of the UK are those most negatively affected by COVID-19. For these places, a further period of reduced income growth and constrained public spending will do nothing to improve the trajectory of long-stagnating towns unless there is a more coherent strategy. Multi-level deals and their governance arrangements need to be articulated within a wider regional-towns partnership that sets the framework of strategic decisions for the settlement system in the region as a whole; more local town-based partnerships have the further functions of ensuring local voice and nuance and business and community commitment.

 

We recommend that the Committee support calls for full devolution to England’s regions and ‘double devolution’ to local communities. To do this effectively, the UK government should:

 

September 2020


[1] Resolution Foundation (N Cominetti, L Gardiner & H Slaughter), The Full Monty: Facing up to the challenge of the coronavirus labour market crisis, June 2020

[2] Institute for Fiscal Studies (Adam, S and Miller, H), Help is coming for (most of) the self-employed, 26 March 2020 https://www.ifs.org.uk/publications/14772

[3] Carnegie UK Trust, Work and Wellbeing ; Carnegie UK Trust, Race Inequality in the Workforce