A New Britain with a Social Guarantee
The Labour Party’s report on constitutional reform, A New Britain, paints a bleak picture of a country riddled with inequality, despair and distrust - and makes a strong case for change. Media headlines have focused on the proposal to abolish the ‘indefensible’ House of Lords, while Kier Starmer has highlighted the pledge to devolve power to the nations and regions of the UK. But what caught our eye was Recommendation 5:
“There should be new, constitutionally protected social rights – like the right to health care for all based on need, not ability to pay - that reflect the current shared understanding of the minimum standards and public services that a British citizen should be guaranteed”.
In other words, universal access to life’s essentials should be a right, not a privilege or concession. Or, as we might put it, a Social Guarantee that meets all our needs. How far does the rest of the report stack up to support this commitment?
Britain in 2022
It starts with a damning analysis of the state of the UK. Deep and growing inequalities in wealth, educational attainment, access to essential services and, of course, between regions. Economic productivity well below that of comparable countries. Local government disempowered and under resourced. Public services crumbling after twelve years of underinvestment.
What’s more, there’s despondency across all social groups. Opinion polls show the majority of people don’t believe their quality of life, financial security or local public services will improve in the next five years. There’s deep distrust of central government and a widespread feeling that it neither understands nor cares about people and places beyond Westminster and Whitehall.
There’s clearly a case for radical change. The Commission’s recommendations make a useful start in key policy areas, but there are still gaps to be filled.
The Commission concludes that the underlying issue from which all these problems stem is the extreme centralisation of the UK.
Ninety-five per cent of all UK tax revenues go to the centre. The burden of austerity has disproportionately fallen on local authorities. Funding cuts of 37% in real terms since 2010, means they are reduced to little more than delivery agents for Westminster who are forced to compete with each other for inadequate handouts.
The report recommends that towns, cities, regions and the devolved nations be given more powers to champion their local areas and meet their residents’ needs. It calls for a Regional Investment Bank with a remit to promote economic equality. The UK Investment Bank is tasked with investing in essential infrastructure across the UK. Notably, the report recommends that competition between nations, regions and central government be replaced with genuine cooperation and collaboration on local issues, and global challenges such as climate change and poverty. Powers over skills, transport and childcare are to be devolved to local governments who understand the needs of their residents better. Local government will be given more power to raise money alongside more control over budgets. A reformed second chamber – The Assembly of the Nations and Regions – would ‘safeguard the institutions of self-government’ and facilitate conversation and collaboration.
These reforms are a great start, though much more would need to be done to reach the stated aim of “requiring decisions to be taken as close as meaningfully and practicably possible to the people affected by them”. As Adam Ramsey points out, “The average population per ‘local government entity’ in Germany is 7,000. In France, it’s 1,800. In the UK, it’s 195,000.”, this would still be the case if all the report’s recommendations were implemented. Though the report calls for ‘Double Devolution’ – a greater involvement of communities in local decision making through mechanisms such as people’s assemblies and participatory budgeting – there is little detail on how this could be put into practice at a systemic level.
The report assumes that promoting economic growth in a more geographically equal way is the route to ending economic inequality and giving communities the public services they deserve. It identifies potential clusters across the UK for investment to make Britain the ‘Home of Innovation in the 21st Century’, outlining four ‘globally competitive’ areas of Genetics, Artificial Intelligence, Additive Manufacturing and 3D printing and Clean Technology.
Investing in these clusters could of course increase growth in selected areas. But what happens to the rest of the UK? In any event, these industries make up a tiny portion of GDP and employ a minute fraction of the population, most of whom are male. Of course, if high-tech industries are expanded, they could take on more people, but even then they would barely
scratch the surface of employment needs even within the clustered hot-spots. There are plenty of cities and regions where highly paid, global industries exist alongside mass poverty and deprivation. London, Cleveland Ohio, Bangalore are just a few examples. Without policies to ensure that wealth stays within local communities through procurement, recruitment and taxation, there is no guarantee that any of these clusters will create new hubs of economic equality.
It would make far more sense to invest in the ‘foundational economy’ - the mundane social and physical infrastructures that enables people to go about their daily lives. It includes public services like health and social care, education, transport and housing, as well as things like energy suppliers, food retailers and water companies. These industries exist in every town, village and city in the UK and employ nearly half of the UK workforce.
If the Labour Party is serious about spreading prosperity across the UK, it needs to prioritise investment in these foundational, placed-based sectors, rather than putting all its eggs in the basket of high-tech innovation. Of course, both forms of investment are important but unrealistic to expect that wealth from innovation clusters will trickle down to communities everywhere.
For us, the most encouraging part of this report is the recommendation that every citizen should have a legal right to a minimum standard of living. It recommends codifying in law the right to health, education and housing, and the right to be ‘free from destitution’ – meaning a right of access to necessary support in the event of unemployment, disability or old age. A genuine commitment to these rights is promising. How they are realised is bound to be complex and challenging.
For example, healthcare free at the point of use is unsurprisingly part of the social rights package. This seems to refer to rebuilding the crumbling NHS. So far so good, but we need to go further. The aim must surely be to promote physical and mental wellbeing, with a focus on preventing rather than just treating illness. Green spaces,
active travel, good food, community engagement – all of these things are vital for wellbeing and should central to a strategy for realising a social right to health. The report acknowledges this in part and leaves the door open for a future government to expand its definition of healthcare.
For education the report focuses on primary and secondary schooling, though again it gives scope for expanding this. In our rapidly changing economies, continuing education throughout adulthood is essential to equip the modern workforce with the skills and training necessary to adapt to rapidly changing circumstances.
For housing, the Commission calls for a right to decent accommodation and more powers devolved to local leaders. A welcome step but ensuring a safe and secure home for every person in the UK requires fundamental reform of the housing sector. This must involve a huge increase in available social homes, mass insulation and retrofitting of existing housing stock, and – crucially – de-financialisation of the housing market. For too long housing has been treated as a money-making asset rather than a necessity for living a good life. Decades of liberalised mortgage lending has ratcheted up house prices by more than 200% since 1999. Large sections of the population can no longer afford to buy homes, while many thousands are living in expensive, poor quality rented accommodation. Poor housing is a well-known cause of a wide range of physical, mental and social problems. All this must be taken into account in working out how to realise a universal right to decent housing.
Finally, the report argues that everyone should have the right to be free from destitution. This is defined as every person having access to assistance when needed. Again, an excellent first step. Well-functioning social care services and a minimum income guarantee are vital parts of a ‘social safety net’. But haven’t we seen how easy it is for willing governments to punch holes in a safety net? And surely we want to do much more than stop people falling into destitution?
The Social Guarantee aims for universal access to life’s essentials within planetary boundaries. It offers a framework for policy and practice that takes preventative action and builds a foundation upon which we can all live a fulfilling life. It means recognising the joined-up benefits of all these elements. Good housing will reduce pressures on health and social care services. High quality education and rewarding career paths in essential sectors across the country will reduce concentrations of power and overheated housing markets. Decent public transport will reduce dependency on private vehicles, improving air quality and the health problems that come with it. The list goes on.
There are some great ideas in this report. Let’s hope it can be the start of a conversation about how to build an economy based on meeting people’s needs in every corner of the UK.
Maeve Cohen is Project Lead at the Social Guarantee