Tim Pilcher: How simple connectivity vouchers can empower Britain’s businesses right now

25 Nov

Tim Pilcher is the CEO of Glide. This is a sponsored post by Glide.

The impact of Covid‐19 on SMEs has been truly staggering, with 9.4 million people placed on furlough by July this year. Many, if not all, SMEs have been forced to change the way they operate overnight and the reliance on connectivity has never been more important. As the Government encourages us to build back better, it’s essential that we give Britain’s businesses what they need to survive, or their very existence could be in danger and the livelihoods of many threatened.

What’s the problem facing SMEs?

SMEs are facing a perfect storm – an unprecedented pandemic and now the impending fallout of Brexit at the end of the year. SMEs are at the heart of the UK’s recovery and economic growth plans, but in order to compete on a national and global stage, they need fast connectivity that works if they are to hope to generate investment in new services and solutions for their customers – and ultimately create job opportunities.

A lack of easily accessible funding to upgrade existing connectivity has meant that gaining fast internet connectivity is still problematic for many SMEs. A successful and efficient, simple, stand alone, non-aggregated voucher scheme to incentivise connectivity already exists – however, demand meant funds were used up quickly plus it is no longer available to new applicants.

The current scheme requires its beneficiaries to be grouped together into areas of demand, which increases the risk that individuals will be left behind. Simply put, either you’re in with your neighbours, or you’re out on your own.

Without Government intervention, local businesses are under threat.

Ultimately, Britain’s SMEs need more support and robust internet connectivity to survive and indeed thrive as they form the heart of the UK’s post‐pandemic and Brexit economy recovery; funding via Government support is needed for those businesses now as many face the risk of closure if they cannot compete in a digital world.

What the SMEs are saying:

“Although I desperately needed better broadband, I couldn’t have upgraded without the voucher scheme. What was great is that the system was so simple. Funding really can’t be a communal thing where businesses have to wait until the whole community agrees – it doesn’t make any practical sense.”

− Eugen Kail, Director, Autozoom

“It is really important for the majority of businesses here to have high speed connectivity to help them expand their business and respond to customers quickly. One of the first questions prospective tenants ask is ‘how good is the internet connection?’.”

− Linda Connelly of Spring Property Management

“Without the support of external funding many companies won’t be able to afford to increase the capability of their internet connections. This will leave them either having to place more employees within the office premises or they will have to scale down their operations either through furlough or redundancies.”

− Steve Voller, Director at MDI Networks Ltd

What can be done?

Fortunately, the solution is pretty simple. We’re calling on the Government to reallocate some existing unused funds from complex schemes, which are expected to be left unspent, into similar, simpler ones to provide immediate support for individual connectivity requirements. Schemes such as the Gigabit Voucher Scheme (GBVS) have proved hugely popular, with around 30,000 applicants successfully improving their connectivity as a result.

While incredibly important to continue to fund schemes to support rural broadband connectivity, we believe the imbalance in uptake compared to funding allocation needs to be set right. As well as funding rural areas, the Government should also consider supporting additional funding for those struggling with connectivity in urban areas. In doing so, it will give SMEs the connectivity they need to survive throughout the ongoing pandemic and into our post‐Brexit environment.

If you believe the Government should intervene and support SMEs to get easier access to funding to support connectivity installation, please register your name here.

Sunak opts to suck it and see

25 Nov

We must be thankful that no-one is forecasting that Government borrowing will rise to record levels this year.  Or Rishi Sunak wouldn’t have been in a position to announce that Government spending will rise at its fastest rate for 15 years.

Apologies for the sarcasm – which isn’t aimed at the Chancellor’s measures, but is meant instead to provide an introduction to the thinking behind them.

One response to a ballooning deficit is to cut the rate of growth of spending.  That’s what the Coalition did after 2010, when the deficit hit seven per cent of GDP.

The Office for Budget Responsibility is forecasting a peak of 19 per this year.  But Sunak’s response is to raise the rate of spending.  Why?

Because in 2010 George Osborne judged the deficit to be structural (he was right), and his successor judges this one to be exceptional (he’s right, too).

It is almost entirely a product of the pandemic and what has followed.  It is in this context that the OBR forecasts the economy to shrink by 11 per cent this year and unemployment to hit 2.6 million next year.

In these circumstances, the Chancellor has found it impossible to produce the four year spending review he hoped for, and has been forced to issue one for a single year instead.

Furthermore, his statement was only one side of the tax and spending coin. Today, we got the spending.  In the Spring, we will get the Budget – and the tax.

Given all this, it will be very odd if Sunak turns up then with large-scale tax rises to raise revenue quickly.  The foundation of his measures today appears to be: suck it and see.

Broadly speaking, the spending package suggests that the Chancellor is going for growth.  That’s the logic of the infrastructure spending, the coming review of regulation, the new northern bank and the enlarged Restart programme.

The Levelling-Up Fund is a classic Treasury exercise in the English centralist tradition, with its central feature of bids from the provinces to Westminster for money.  So it is in a country with relatively few local taxes.

On that point, Sunak announced “extra flexibility for Council Tax and Adult Social Care precept”.  Local authorities will like that, council taxpayers not so much.

It’s worth stressing that the OBR’s forecasts, like all such animals, shouldn’t be taken too seriously.  Our columnist Ryan Bourne debunked its record on this site earlier this week.

If you walk down the sunny side of the street, you will smack your lips at the thought of a Roaring Twenties effect, as employment recovers, consumers spend, the hospitality sector booms and people pile into holidays abroad.

And it may be that post-Covid changes even out for the better, with a shift in activity and spending from city centres to the suburbs and countryside, together with music, art, theatre and all the rest of it.

That might not be such a bad things for towns and their centres, at which the new Levelling Up Fund is partly aimed.  Our columnist James Frayne believes they are a core concern for provincial voters, and government listens to him.

If on the other hand you stick to the shady side, you will point to the economic equivalent of Long Covid: fearsome economic and social bills for damaged mental health, postponed operations, lost educational opportunities.

All that is a big minus for levelling-up – because it’s the disabled, poor and disadvantaged who have been hit hardest by restrictions and lockdowns, especially if they work in the private sector.

The background in recent years is not encouraging.  Since the financial crash exploded, we haven’t grown at more than 2.6 per cent a year.  That suggests recovery may be sticky.

Sunak’s persuasive manner, grip of detail and spare eloquence have served him well during this crisis.  Others holding his post would not have survived roughly ten major finance annoucements in less than a year.

It’s not as though he hasn’t sometimes had to recast his plans – as in October, when he pumped more money into his Job Support Scheme.

And if the economics of his strategy are straightforward enough, its politics was sometimes a bit odd.  If the Government’s overall plan in the short-term is expansionary, why raise the minimum wage but curb public sector pay?

If spending on nearly everything else is rising, why crack down on the 0.7 per cent aid spend?  Doing so because you think aid is wasted or the target is wasteful is one thing.

But that wasn’t the basis of Sunak’s decision – since, after all, he said that the Government intends to return to 0.7 per cent “when the fiscal situation allows”.

The Chancellor also left a big unresolved question hanging in the air.  What will the Government do about the Universal Credit uplift?  Will it be extended or not?

The sense of a statement with contradictory messages was picked up Rob Covile of the Centre for Policy Studies.  (The Treasury would do well when the Budget approaches to look at its supply side ideas.)

“Feels slightly like Treasury couldn’t decide whether the message was ‘tighten belts’ or ‘we’re still spending’,” he tweeted. “So we’re getting two or three minutes of each in turn.”

That first element in the Chancellor’s statement, plus the OBR’s horrid short-term forecasts, comes at a bad time for the Government.

For tomorrow, the toughened tiering details are announced. Lots of Conservative MPs won’t like them.  The detail of which tiers apply in which areas will be published, too.  Many Tory MPs will like those even less.

Graham Brady, Steve Baker, Mark Harper, and the Covid Recovery Group will say that the economic damage of restrictions is so severe that the Commons should not vote for more – at least, without an impact assessment.

They may not be alone.  “These measures may be a short-term strategy, but they cannot be a long-term one,” Jeremy Wright declared in the Commons during the recent debate on the lockdown regulations.

He and Edward Timpson (another ex-Minister) plus other MPs backed the Government but, sounded a cautionary note.

Will the prospect of vaccines be sufficient to rally the doubters round?  Or will they take a leaf from the book of Theresa May, who savaged the regulations during the same debate?

We shall see – but Ministers are not helping themselves by dodging requests for that impact assessment, urged by this site and others, and the subject of a dogged campaign by Mel Stride, Chair of the Treasury Select Committee.

All in all, Sunak is shaping up to go for growth.  Good for him.  Nonetheless, he must watch and wait to see how and when the economy rebounds.  Brady and company are less patient.

Andrew Gimson’s Commons sketch: The Chancellor brings a mysterious poetry to his numbers

25 Nov

“Numbers alone can ring hollow,” Rishi Sunak said at the end of his statement. But in his mouth, numbers did not ring hollow.

He brought a mysterious poetry to these figures. We are borrowing and spending far more than we can afford, or expected only a few months ago, and have also suffered “the largest fall in output for over 300 years”.

The Chancellor avowed that the debt we are accumulating is “clearly unsustainable over the medium term”.

And yet his transcendent lucidity and preternatural calm made the whole situation seem sustainable, the recovery just a matter of remaining as clear-headed and unflustered as Sunak.

Many Chancellors sound bored by the figures they read out to the House, or at least make those figures sound boring to the less numerate Members of Parliament.

Sunak somehow conveyed his love of spreadsheets in a way that Philip Hammond, his predecessor but one, never managed to do. There was a music of the spheres in all those noughts.

Lord Chesterfield said that Sir Robert Walpole, Prime Minister from 1721-42, when addressing MPs was

“So clear in stating the most intricate matters, especially in the finances, that while he was speaking the most ignorant thought that they understood what they really did not.”

Sunak has the same gift. And just as Walpole was trusted to clear up after the South Sea Bubble of 1720, so Sunak is trusted, at least for now, to clear up after the pandemic.

His lustrous black hair contains more streaks of grey than it did when he started in February, but otherwise he seems unaffected by the burden he bears.

In a level tone he announced “a new Levelling Up Fund worth £4 billion” from which any local area will be allowed to bid for projects which will have a noticeable impact and be “delivered within this Parliament”.

Sunak does not wish those Labour voters who turned Conservative last December to feel in 2024 that the Chancellor has let them down.

Nor does he wish anyone to suppose he is an unfeeling technocrat, who thinks only the figures matter. He ended by saying that the spending he had announced was “secondary to the courage, wisdom, kindness and creativity it unleashes”.

We are united in a moral mission, “a common endeavour”. Anneliese Dodds, replying for the Labour Party, was left with nothing much to say, and could not be blamed for that. She is a great improvement on her predecessor, but could not spoil Sunak’s day.

The Chancellor’s Spending Review statement. Full text – “The UK is forecast to borrow a total of £394 billion this year”

25 Nov

“On Monday, the Prime Minister set out the action we need to take between now and the start of December to control the spread of coronavirus.

Mr Speaker,

Today’s Spending Review delivers on the priorities of the British people.

Our health emergency is not yet over.

And our economic emergency has only just begun.

So our immediate priority is to protect people’s lives and livelihoods.

But today’s Spending Review also delivers stronger public services.

Paying for new hospitals, better schools and safer streets.

And it delivers a once-in-a-generation investment in infrastructure.

Creating jobs, growing the economy, increasing pride in the places we call home. 

Mr Speaker,

Our immediate priority is to protect people’s lives and livelihoods.

So let me begin by updating the House on our response to coronavirus.

We’re prioritising jobs, businesses and public services.

The furlough scheme, support for the self-employed, loans, grants, tax cuts and deferrals as well as extra funding for schools, councils, the NHS, charities, culture and sport.

Today’s figures confirm that taken together:

This year, we are providing £280 billion to get our country through coronavirus.

Next year, to fund our programmes on testing, PPE, vaccines – we are allocating an initial £18 billion.

To protect the public services most affected by coronavirus, we are also providing:

£3 billion to support NHS recovery, allowing them to carry out up to a million checks, scans and operations.

Over £2 billion to keep our transport arteries open, subsidising rail networks.

Over £3 billion to local councils.

And an extra £250 million to help end rough sleeping.

And while much of our coronavirus response is UK-wide, the government is also providing £2.6 billion to support the devolved administrations in Scotland, Wales and Northern Ireland.

Taken together, next year, public services funding to tackle coronavirus will total £55 billion.

Mr Speaker,

Let me turn to the OBR’s economic forecasts.

And can I thank the new Chair, Richard Hughes, and his whole team, for their work.

The OBR forecast the economy will contract this year by 11.3%, the largest fall in output for more than 300 years.

As the restrictions are eased, they expect the economy to start recovering growing by 5.5% next year, 6.6% in 2022, then 2.3%, 1.7% and 1.8% in the following years.

Even with growth returning, our economic output is not expected to return to pre-crisis levels until the fourth quarter of 2022.

And the economic damage is likely to be lasting.

Long-term scarring means, in 2025, the economy will be around 3% smaller than expected in the March Budget. 

Mr Speaker,

The economic impact of coronavirus, and the action we’ve taken in response, means there has been a significant but necessary increase in our borrowing and debt.

The UK is forecast to borrow a total of £394 billion this year, equivalent to 19% of GDP.

The highest recorded level of borrowing in our peacetime history.

Borrowing falls to £164 billion next year, £105 billion in 2022-23, then remains at around £100 billion, 4% of GDP, for the remainder of the forecast.

Underlying debt – after removing the temporary effect of the Bank of England’s asset purchases – is forecast to be 91.9% of GDP this year.

And due to elevated borrowing levels, and a forecast persistent deficit, underlying debt is forecast to continue rising in every year, reaching 97.5% of GDP in 2025-26.

High as these costs are, the costs of inaction would have been far higher.

But this situation is clearly unsustainable over the medium term.

We could only act in the way we have because we came into this crisis with strong public finances.

And we have a responsibility, once the economy recovers, to return to a sustainable fiscal position. 

Mr Speaker,

This is an economic emergency.

That’s why we have taken, and continue to take, extraordinary measures to protect people’s jobs and incomes.

And it is clear those measures are making a difference.

The OBR now state – as the Bank of England and the IMF already have – that our economic response has protected jobs, supported incomes and helped businesses stay afloat.

They’ve said today that business insolvencies have fallen, compared to last year.

And the latest data shows the UK’s unemployment rate is lower than Italy, France, Spain, Canada and the United States.

And we’re doing more to build on our Plan for Jobs.

I’m announcing today nearly £3 billion for My Right Honourable Friend the Work & Pensions Secretary to deliver a new, three-year Restart Programme to help over a million people who’ve been unemployed for over a year, find new work.

But I have always said: we cannot protect every job.

Despite the extraordinary support we’ve provided, the OBR expects unemployment to rise to a peak in the second quarter of next year, of 7.5% – 2.6 million people.

Unemployment is then forecast to fall in every year, reaching 4.4% by the end of 2024.

Mr Speaker,

Today’s statistics remind us of something else: coronavirus has deepened the disparity between public and private sector wages.

In the six months to September, private sector wages fell by nearly 1% compared to last year. Over the same period, public sector wages rose by nearly 4%.

And unlike workers in the private sector, who have lost jobs, been furloughed, seen wages cut, and hours reduced, the public sector has not.

In such a difficult context for the private sector – especially for those people working in sectors like retail, hospitality, and leisure I cannot justify a significant, across-the-board pay increase for all public sector workers.

Instead, we are targeting our resources at those who need it most.

To protect public sector jobs at this time of crisis, and ensure fairness between the public and private sectors, I am taking three steps today.

First, taking account of the pay review bodies advice, we will provide a pay rise to over a million Nurses, Doctors and others working in the NHS.

Second, to protect jobs, pay rises in the rest of the public sector will be paused next year.

But third, we will protect those on lower incomes.

The 2.1 million public sector workers who earn below the median wage of £24,000, will be guaranteed a pay rise of at least £250.

What this means, Mr Speaker, is that while the government is making the difficult decision to control public sector pay the majority of public sector workers will see their pay increase next year.

And we want to do more for the lowest paid.

We are accepting in full the recommendations of the Low Pay Commission to increase the National Living Wage by 2.2% to £8.91 an hour; to extend this rate to those aged 23 and over; and to increase the National Minimum Wage rates as well.

Taken together, these minimum wage increases will likely benefit around two million people.

A full-time worker on the National Living Wage will see their annual earnings increase by £345 next year.

And compared to 2016 when the policy was first introduced, that’s a pay rise of over £4,000. 

Mr Speaker,

These are difficult and uncertain economic times – so it is right that our immediate priority is to protect people’s health and their jobs.

But we need to look beyond.

Today’s Spending Review delivers stronger public services – our second priority.

Before I turn to the details, let me thank the whole Treasury team, and especially My Right Honourable Friend the Chief Secretary for their dedication and hard work in preparing today’s Spending Review.

Next year, total departmental spending will be £540 billion.

Over this year and next, day-to-day departmental spending will rise, in real terms, by 3.8% – the fastest growth rate in 15 years.

In cash terms, day-to-day departmental budgets will increase next year by £14.8 billion.

And Mr Speaker, this is a Spending Review for the whole United Kingdom.

Through the Barnett formula, today’s decisions increase Scottish Government funding by £2.4 billion, Welsh Government funding by £1.3 billion, and £0.9 billion for the Northern Ireland Executive.

The whole of the United Kingdom will benefit from the UK Shared Prosperity Fund, and over time we will ramp up funding so that total domestic UK-wide funding will at least match EU receipts, on average reaching around £1.5 billion a year.

To help local areas prepare for the introduction of the UKSPF, next year we will provide funding for communities to pilot programmes and new approaches.

And we will accelerate four City and Growth Deals in Scotland, helping Tay Cities, Borderlands, Moray, and the Scottish Islands create jobs and prosperity in their areas.

Mr Speaker,

Our public spending plans deliver on the priorities of the British people.

Today’s Spending Review honours our historic, multi-year commitment to the NHS.

Next year, the core health budget will grow by £6.6 billion, allowing us to deliver 50,000 more nurses and 50 million more general practice appointments.

We’re increasing capital investment by £2.3 billion.

To invest in new technologies to improve patient and staff experience.

Replace ageing diagnostic machines like MRI and CT scanners.

And fund the biggest hospital building programme in a generation – building 40 new hospitals and upgrading 70 more.

We’re investing in social care, too.

Today’s settlement allows Local Authorities to increase their core spending power by 4.5%.

Local authorities will have extra flexibility for Council Tax and Adult Social Care precept which together with £300 million of new grant funding gives them access to an extra billions pounds to fund social care.

And this is on top of the extra billion pound social care grant we provided this year, which I can confirm will be maintained into next year.

To provide a better education for our children, we’re also getting on with our three-year investment plan for schools.

We’ll increase the schools’ budget next year by £2.2 billion, well on the way to delivering our commitment of an extra £7.1 billion by 2022-23.

Every pupil in the country will see a year-on-year funding increase of at least 2%.

And we’re funding the Prime Minister’s commitment to rebuild 500 schools over the next decade.

And we’re also committed to boosting skills.

With £291 million to pay for more young people to go into further education.

£1.5 billion to rebuild colleges.

£375 million to deliver the Prime Minister’s Lifetime Skills Guarantee.

And extend traineeships, sector-based work academies, and the national careers service.

As well as improving the way the apprenticeships system works for businesses.

And we’re also making our streets safer.

Next year, funding for the criminal justice system will increase by over a billion pounds.

We’re providing more than £400 million to recruit 6,000 new police officers – well on track to recruit 20,000.

And £4 billion over four years to provide 18,000 new prison places.

New hospitals, better schools, safer streets – the British people’s priorities are this government’s priorities.  

Mr Speaker,

Today’s Spending Review strengthens the United Kingdom’s place in the world.

This country has always and will always be open and outward-looking, leading in solving the world’s toughest problems.

But during a domestic fiscal emergency, when we need to prioritise our limited resources on jobs and public services sticking rigidly to spending 0.7% of our national income on overseas aid, is difficult to justify to the British people especially when we’re seeing the highest peacetime levels of borrowing on record.

I have listened with great respect to those who have argued passionately to retain this target.

But at a time of unprecedented crisis government must make tough choices.

I want to reassure the House that we will continue to protect the world’s poorest:

Spending the equivalent of 0.5% of our national income on overseas aid in 2021, allocating £10 billion at this Spending Review.

And our intention is to return to 0.7% when the fiscal situation allows.

Based on the latest OECD data, the UK would remain the second highest aid donor in the G7.

Higher than France, Italy, Japan, Canada and the United States.

And 0.5% is also considerably more than the 29 countries on the OECD’s development assistance committee – who average just 0.38%.

And overseas aid is of course only one of the ways we play our role in the world.

The Prime Minister has announced over £24 billion investment in defence over the next four years, the biggest sustained increase in 30 years.

Allowing us to provide security not just for our country but around the world.

We’re investing more in our extensive diplomatic network, already one of the largest in the world.

And providing more funding for new trade deals.

We should, however, judge our standing in the world not just by the money we spend but by the causes we advance and the values we defend.

Mr Speaker,

If this Spending Review’s first priority was getting the country through coronavirus.

And its second was stronger public services.

Then our final priority is to deliver our record investment plans in infrastructure.

Capital spending next year will total £100 billion – £27 billion more in real terms than last year.

Our plans deliver the highest sustained level of public investment in more than 40 years.

Once-in-a-generation plans to deliver once-in-a-generation returns for our country.

To build housing, we’re introducing a £7.1 billion National Home Building Fund.

On top of our £12.2 billion Affordable Homes Programme.

We’ll deliver faster broadband for over 5 million premises across the UK.

Better mobile connectivity with 4G coverage across 95% of the country by 2025.

The biggest ever investment in new roads.

Upgraded railways, new cycle lanes and over 800 zero emission buses.

Our capital plans will invest in the greener future we promised.

Delivering the Prime Minister’s ten-point plan for climate change.

We’re making this country a scientific superpower.

With almost £15 billion of funding for research and development.

And we’re publishing today a comprehensive new National Infrastructure Strategy.

To help finance our plans, I can also announce we will establish a new UK infrastructure bank.

Headquartered in the north of England, the Bank will work with the private sector to finance major new investment projects across the UK – starting this spring.  

Mr Speaker,

I have one further announcement to make.

For many people, the most powerful barometer of economic success is the change they see and the pride they feel in the places they call home.

People want to be able to look around their towns and villages and say, yes: our community – this place – is better off than it was five years ago.

For too long, our funding approach has been complex and ineffective.

And I want to change that.

Today I’m announcing a new Levelling Up Fund worth £4 billion.

Any local area will be able to bid directly to fund local projects.

The fund will be managed jointly between the Treasury, the Department for Transport and the Ministry of Housing, Communities and Local Government – taking a new, holistic, place-based approach to the needs of local areas.

Projects must have real impact.

They must be delivered within this Parliament.

And they must command local support, including from their Member of Parliament.

This is about funding the infrastructure of everyday life:

A new bypass.

Upgraded railway stations.

Less traffic.

More libraries, museums, and galleries.

Better high streets and town centres.

This government is funding the things people want and places need.  

Mr Speaker,

Today I have announced huge investment in jobs, public services and infrastructure.

And yet… I cannot deny numbers alone, can ring hollow.

They stand testament to our commitment to create a better nation, but on their own they are not enough to create one.

When asked what our vision for the future of this country is, we cannot point to a shopping list of announcements and feel the job is done.

So, as we invest billions in research and development, we’re also introducing a new immigration system ensuring the best and brightest from around the world come here to learn, innovate and create.

As we invest billions in the building of new homes, we’re also simplifying our planning system to ensure beautiful homes are built where they are needed most.

As we invest billions in the security of this country, we’re also defending free speech and democratic rule, proving our values are more than just words.

And as we invest billions in public services, we’re also protecting the wages of those on the lowest incomes and supporting jobs because good work remains the most rewarding and sustainable path to prosperity.

The spending review announced today sets us on a path to deal with the material matters of government and it is a clear statement of our priorities but encouraging the individual and community brilliance on which a thriving society depends, remains, as ever, a work unfinished.

We in government can set the direction, better schools, more homes, stronger defence, safer streets green energy, technological development, improved rail, enhanced roads all investments that will create jobs and give every person in this country the chance to meet their potential.

But it is the individual, the family, and the community that must become stronger, healthier and happier as a result.

This is the true measure of our success.

The spending announced today is secondary to the courage, wisdom, kindness and creativity it unleashes.

These are the incalculable but essential parts of our future, and they cannot be mandated or distributed by government.

These things must come from each of us, and be shared freely, because the future, this better country, is a common endeavour.

Today government has funded the priorities of the British people, and now the job of delivering them, begins.

Mr Speaker, I commend this statement to the House.”

The Health Foundation: What should the Government do to tackle obesity? Find out in our new podcast.

25 Nov

This is a sponsored post by The Health Foundation.

The Health Foundation’s new podcast series promises to delve into the most important issues affecting the future of health and care for people in the UK.

Hosted by Dr Jennifer Dixon, Chief Executive of the Health Foundation, the series brings together leading minds in health and care and high-profile names from politics and the media. Every month, we take a 30-minute deep-dive into a unique angle on the most topical issues impacting our health now and in the future.

So if you’re curious about the NHS, health science, policy, health care and spending, then listen and subscribe to the Health Foundation podcast.

Every episode can be streamed or downloaded through your choice of the most popular platforms.

You can also subscribe to the Health Foundation podcast on your preferred platform to receive future episodes when they’re released each month.

Episode 1 – How to be health secretary

In October’s inaugural episode, Dixon asks Jeremy Hunt for his view on the role of the health secretary and its relation to the management of the NHS. Joining the conversation is award-winning author Nicholas Timmins, who wrote the latest edition of the Health Foundation’s Glaziers & window breakers, a book which includes interviews with 11 former health secretaries together with original analysis.

Dixon, Hunt and Timmins look back at the major themes of Hunt’s time in office as the longest serving health secretary – such as patient safety and how far he sought to ‘ignore’ the reforms of his predecessor. But the conversation also looks forward. With the challenges of the Covid-19 pandemic holding the world’s attention, what would Hunt have done differently? And what are the key lessons for government as we enter a new phase of the pandemic? This episode is available to stream and download below now.

Episode 2 – The Government’s role in tackling obesity in the UK

This month, the Health Foundation podcast addresses obesity. Joining Dixon for November’s podcast were:

  • Sally Davies, now Master of Trinity College Cambridge, who stepped down just last year as Chief Medical Officer for England and Chief Medical Adviser to the UK government;
  • Harry Rutter, Professor of Global Public Health at the University of Bath; and
  • James Forsyth, Political Editor at The Spectator, a regular on the Spectator’s daily podcast Coffee House Shots and who writes a weekly column for The Times newspaper.

In a thought-provoking discussion, the panel discuss trends relating to obesity in the UK and what can and should be done. Prevalence of obesity is higher in more deprived communities, and obesity is linked to a range of health conditions – as well as increasing a person’s risk from Covid-19.

Evidence tells us that communities, government policies, commercial influences, and many other factors shape our ability to be healthy – but people often think it’s up to individuals to manage their own weight. Some governments are also squeamish about intervention in people’s lives leading to a so-called ‘nanny state’.

However, recent polling by Ipsos MORI for the Health Foundation shows that the Coronavirus pandemic has changed the way that people in the UK view the Government’s role in improving our health. The pandemic has also moved tackling obesity higher up the Government’s agenda.

So what should it be doing to tackle obesity? Listen below to find out.

Enjoyed these episodes?

You can stream or download the Health Foundation podcast through your choice of the most popular podcast platforms.

Don’t forget to subscribe to the podcast to receive future episodes when they’re released. And if you enjoy the conversation, please share it with a colleague or peer, and leave a review.

Ryan Bourne: Calm down, stay cool – and drop this talk of tax rises. It’s too early to know how everything will settle down.

25 Nov

Ryan Bourne is Chair in Public Understanding of Economics at the Cato Institute.

I feel as if I am stuck in some mid-2010s time warp. Rishi Sunak will today update us on how much the Government has splurged during this Covid-ridden year and what it intends to spend next year.

But commentators are already pivoting to sizing up what deficit reduction will eventually be needed, and whether tax rises or spending cuts should fill the future fiscal hole. That conversation will be spurred today by the Office for Budget Responsibility updating its guesstimates of how far the pandemic will permanently impair the economy’s potential, and so the “structural deficit” to deal with. Welcome to the Austerity Wars 2.0.

As I’ve said before, all this debate is massively premature. Yes, this pandemic has caused masses of government borrowing—producing a deficit of 21 percent of GDP or around £400 billion, according to the Resolution Foundation. But we are (still) in a once-in-a-half-century pandemic where we have knowingly kept shuttered swathes of the economy and paid people to sit at home.

There will obviously be “deficit reduction” next year, in the sense that the vaccines ending the pandemic will bring furlough to a close, make Covid-19 test and tracing redundant, and see the end of the inoculation and PPE scrambles. Like demobilisation at the end of war, so the government will de-Covidise its budget with drastic cuts to virus-related expenditure. Likewise, as things re-open, tax revenues will ascend again. So, the deficit will fall.

But anyone who claims they know what level it will settle at, and so what “needs to be done” to re-achieve pre-Covid borrowing levels, is, quite frankly, talking poppycock – including the Office for Budget Responsibility.

None of us, nor them, really have a clue what the long-term impact of this crisis will be on the economy. Will a whole bunch of industries shrink permanently now that the risk of government shutdown orders in future pandemics is understood? Will people stick with online retail and eat out less than they did? Will professionals work from home more, transforming parts of inner cities? Or is there a pent-up demand for socialising and “the old life on speed,” with a roaring 20s to come, as after the Spanish Flu?

Without knowing all this, nobody can say what demands on public service spending will be or how tax revenues will perform over the next five years. Add in the uncertainty of whether there will be a Brexit deal, and the underlying budget position for Sunak is pretty much unknowable today – the whole reason, remember, that the Chancellor is only delivering a one-year spending review.

To see the scale of uncertainty, note that various independent forecasters have predicted that UK government borrowing in 2021 could be anywhere from £102 billion up to £273 billion. That’s a bigger range than the actual unprecedented borrowing of 2009/10.

So we need to take whatever comes out of the OBR’s economic and fiscal outlook today with gallons of salt. Their forecasts have already proven unduly pessimistic, with borrowing outturns from April through October a massive £76.5 billion lower than they were expecting. Nor, historically, have they had a stellar record in assessing the growth potential of the UK economy exiting a deep crisis.

Back in 2010, remember, the OBR predicted a return to robust productivity growth, meaning George Osborne’s strict spending limits were predicted to eliminate the structural deficit as early as 2015. That didn’t happen, despite spending levels being delivered as planned.

So it’s baffling why think-tanks are taking the OBR assessments today as truth, and outlining “fiscal repair” measures of £40 billion to be delivered from 2023 onwards already. The Resolution Foundation wants significant tax rises on everyone earning over £20,000, for example.

Why not just calm down a bit, and see how things shake out? My central assumption is indeed that there will be a bit of a hit to our growth potential from living through this crisis, pushing the structural deficit up. And, obviously, if the Government keeps NHS spending higher and permanently raises Universal Credit generosity even after the pandemic ends, on top of recent announcements on defence spending and the “green industrial revolution,” then this makes the prospect of future deficit reduction less likely. But it’s the underlying economy that still has the biggest impact on the public finances, and that should be our focus right now.

Indeed, in talking up the need for restraint, the Chancellor, the OBR, and others may be unwittingly damaging our recovery prospects. Tell people big tax hikes are coming, and they begin thinking their permanent incomes will be lower because the economy’s prospects are weaker.

Of course, the Chancellor is trying to balance risks, and make clear to bond markets that the government is aware of the need for fiscal discipline in the longer-term. But what does he think headlines telling people to “prepare for tax pain next year” achieve? As Julian Jessop asked, wisely, on Twitter, what should that preparation look like? “Increase savings? Cut investment? Dump assets? Don’t start that new business?” How is that helpful given where we are?

Rather than lasering in on the deficit as a target, it would be better for now if the debate stayed focused on how to achieve a strong recovery. Whether they help or hinder the economic rebound should be the metric by which we judge almost all new spending and tax choices today, as well as regulatory policy. Anything that we can do to ensure the vaccine roll-out goes as smoothly and quickly as possible, for example, will produce a huge economic stimulus. Bringing forward the end of pandemic restrictions by just one month could generate tens of billions in value.

But even beyond getting that right, we need to stop talking as if spending measures are something wholly independent of our recovery prospects. The whole public sector pay debate, for example, has been tiresome in focusing on whether the Government can afford to raise public sector pay, or whether it is fair too, rather than about how setting pay rates will affect the jobs recovery. A more disaggregated analysis would surely conclude that raising pay in areas of the public realm under severe strain due to Covid is highly desirable to ensure good retention and recruitment, whereas pay restraint is justified in areas where public sector productivity has plunged due to home working.

Yet, sadly, thinking through how spending or tax policy affects our growth potential is not where public discourse is. Instead, people are already fighting the last war, battling over shaping the narrative on whether another round of spending cuts are desirable, or else buttering us up for yet higher taxes despite the historically high burden even before Covid-19 hit. The biggest 2010s economic policy mistake was not austerity, but that the focus on it led us to being fatalistic about growth. Let’s not do the time warp again.

Liam Fox: Today, the Chancellor should aim to boost an unambiguously private sector-led recovery

25 Nov

Liam Fox is a former Secretary of State for International Trade, and is MP for North Somerset.

The successful development of vaccines by the world’s largest – private sector – pharmaceutical companies brings much-needed optimism as we look forward to 2021. Yet, any political respite for the Government is likely to be short lived, as the focus inevitably shifts towards the seismic economic impact that the coronavirus has created at home and abroad.

As the Chancellor said at the weekend “people will see the scale of the economic shock laid bare”.

The UK’s overall debt has now reached 100.8 per cent of gross domestic product (GDP) – a level not seen since the early 1960s. It is terrifying to imagine where we would be if the public finances had not been improved to the extent they have over the past decade. The most recent Bank of England forecast estimates that unemployment may peak at around 7.7 per cent in April to June of next year but could be as high as 10 per cent.

The key to the post-Covid-19 recovery will rely on the ability of Britain’s small businesses to create jobs on the scale that we have seen in recent years. At the beginning of 2020 there were 5.82 million small businesses (with 0 to 49 employees), 99.3 per cent of the total business population.

Despite the unprecedented support from the Government through the Coronavirus Job Retention Scheme (the furlough) which has been extended to the end of March 2021, the Business Interruption Loan Scheme and the Self-Employment Income Support Grant, many small businesses fear that they may not survive the transition to the economic “new normal”.

The unprecedented government assistance has masked the fact that this group has suffered more than most in the varying degrees of lockdown that we have experienced since March, with some still struggling to get lenders to support them.

The longer that lockdown continues, the more that demand for their goods and services is likely to be depressed and their viability threatened. Many fear they may not survive to see the recovery. That is why, in his spending statement this week, the Chancellor must make clear the Government’s commitment to Britain’s SMEs, for this must be an unambiguously private sector-led recovery.

While there are understandable demands to pump more funding into the public sector, we must restore the habit of making sure we have the money in the bank before we start spending it.

Unless we are able to grow our economy through the private sector and generate more national income, then we will be back in the territory of having to choose between damaging tax rises or unpopular spending cuts.

Our ability to borrow heavily during this crisis has maintained the viability of a large part of our economy but an inability to control future borrowing will be deeply damaging to our long-term prosperity and our ability to fund the quality public services on which we depend.

I would like, in his financial statement, to see the Chancellor replace or at least add to David Cameron’s policy test which was “how will this affect and be perceived by every family in Britain”. The new test would be “the entrepreneur test”. This is in line with his natural instincts.

We must assess how every bit of legislation and every regulation will affect the wealth creating part of our economy and our every statement and every speech should be mindful of the message it sends to our small business community.

We must ensure that we are not only a great place for business start-ups but that we can deal with the lack of capital that often results in a failure of scale ups. We must ensure that the elements that make the United Kingdom such an attractive place for foreign direct investment continue – a stable regulatory framework, an attractive tax environment, flexible skills in our labour force, access to quality higher education, access to tech and gold standard protection for intellectual property. As the world’s third largest destination for foreign direct investment, we are already strong in all these areas.

In the 1980s, the Conservatives demonstrated our commitment to the ownership society through our totemic policy of council house sales. The Conservatives must now be seen as the natural ally for every white van man and woman, every tech entrepreneur and every corner shop owner. The Chancellor must make us unequivocally the party of small business.

Daniel Hannan: It would be unfair to pupils in England to cancel exams next year

25 Nov

Daniel Hannan is a writer and columnist. He was a Conservative MEP from 1999 to 2020, and is now President of the Initiative for Free Trade.

The cancellation of exams this year was bad news for all involved. It was unfair to those students who would have won high grades without an artificial boost. It was prejudicial to past and future cohorts. It was a nightmare for universities, which were presented with an administrative headache. It was a disaster for Ofqual, which failed to rise to its first serious challenge. And, of course, it was calamitous for Gavin Williamson, who got the blame.

Whether that blame was merited is beside the point (I argued on ConHome at the time that the exams débâcle was an example of ministers having “responsibility without power”, because voters blame them rather than the state agencies that they simultaneously demand be “free from political interference”). The fact is that we stumbled into a terrible situation, closing our schools despite children not normally contracting or passing on serious Covid symptoms, and then scrapping exams because it seemed the line of least resistance.

Now we know better. Yet – and I find my fingers trembling with incredulity as I type these words – we look like walking into the same mistake again, only this time without the excuse of having acted blindly. The Labour administration in Cardiff has cancelled GCSEs and A-levels for 2021. The SNP administration in Edinburgh has cancelled National 5 exams (which are very roughly equivalent to GCSEs) and says it will decide in February whether to go ahead with Highers.

In England, the stated position is still that all exams will go ahead, albeit a few weeks later to allow schools to make up for lost time. That line might yet hold. But it seems just as likely that, as has happened again and again during the epidemic, the devolved assemblies will push the Tories into a more extreme position than they want.

Various ideas are being floated that would allow Williamson to climb down while pretending to have kept his promise – some combination of exams and teacher assessment, for example, or full GCSEs going ahead only in core subjects such as English, maths and science. All these ideas should be resisted – for the sake of employers, the Conservative Party’s reputation and, above all, the students themselves.

It is notable that the strongest pressure for cancelling (or decaffeinating) public exams comes from people who were already against them before Covid. Progressive educationalists – what Michael Gove called the Blob – have always seen national exams as intolerably stressful.

It is true that exams can be stressful. It is true, too, that they can be blunt instruments. But no one has come up with a better way to gauge the abilities of students across the nation in a consistent way. Continuous assessment is not a uniform measure. Teachers would be, so to speak, marking their own homework (for once the metaphor seems apt).

We accept this logic for most other acquired skills. Music grades, a driving licence, a foreign language diploma – all require an externally invigilated exam. How could we not apply it to something as fundamental as the qualifications which will determine where students complete their education or what they say in their first job interview?

Of course, not everyone who is against holding exams next year wants them abolished forever. Some argue that it is simply unfair to go ahead given how many kids have had their educations disrupted – not just by the effective loss of much of last term, but by repeated interruptions in this one, as bubbles or even entire year-groups are sent home when a pupil tests positive.

That criticism begs the question. It surely cannot be right to send healthy children home because of a virus which poses next to no risk to young people. It would make more sense to withdraw potentially vulnerable members of staff and let children carry on as normal. We have not taken that route; but we can at least now offer priority vaccination to teachers and other staff who might be at risk, and let school life resume in full – plays, sports, no masks.

More seriously, though, who can doubt, in retrospect, that going ahead with this year’s exams would have given schools a much-needed sense of focus? We had plenty of space, and other countries managed.

Of all the things that 2020 has revealed, the most shocking is the vast distance between ambitious and unambitious schools. Good state schools (and most private schools) tried to run something close to a normal schedule, with online assemblies, music lessons, sports days, the works. Bad ones sent out desultory work sheets and, in some cases, refused to mark them. This was not a question of resources – a Zoom lesson costs nothing – but of motivation. By and large, the schools which were least willing to teach online last term have been the quickest to send kids home this term. And in many cases, the pupils being sent home are those who can least afford the disruption.

Cancelling exams, in other words, serves to widen the attainment gap. Some schools treat Covid as a challenge, others as an excuse. And, though there are good and honourable exceptions, the schools serving poorer communities are often in the second category. If exams are cancelled or curtailed, which schools are likeliest to take their foot off the accelerator? It won’t be Winchester or Westminster, will it?

I argued that this term should start in August, but that proved impossible because the interests of the producers were elevated above those of the consumers. We could, if lost time really is the objection to 2021’s exams going ahead, shorten the Easter holidays and pay teachers a bonus for the extra work. But, either way, we owe it to our teenagers to let them compete fairly for the qualifications that other year-groups acquired.

We keep saying that we will “put children first” but, so far during this lockdown, we have done nothing of the kind. They have suffered enough.

David Simmonds: Cutting early intervention in children’s services would cost more in the long term

25 Nov

David Simmonds is the MP for Ruislip, Northwood and Pinner

Throughout this pandemic, government has extended support for children and families. From furlough, to uplifting Universal Credit, to rolling out the holiday food and activities programme for future school holidays, to keeping vulnerable children learning throughout the pandemic.  These have been appropriate and important interventions. However, the foundations upon which we seek to strengthen and support families are growing increasingly unstable.

Councils are at the forefront of delivering life-changing support keeping children safe and families strong. They are duty-bound to safeguard and promote the welfare of children within their families, insofar as this is safe and in the child’s best interests. They are also required to deliver a balanced budget. Before this pandemic, the challenges facing local government finances and rising need for support meant that Children’s Services were placing a significant and unsustainable pressure on local authority budgets.  At a time when funding was falling, councils were being asked to do more and not less. This has only been exacerbated by COVID-19 and despite additional resources from government during the pandemic, there is an acute cash flow problem developing in the sector that means the measures required to balance budgets in year will have a long term impact on children.

Leading children’s charities have also reported recently that those areas the government has promised to ‘level up’ are amongst those where funding for children’s services has fallen the fastest. These also happen to be communities where indicators of demand for children’s services such as rates of domestic abuse, parental mental ill-health, and free school meal eligibility are the highest. Levelling up people and places must mean investing in children and families.

As a former Cabinet Member for Children’s Services, I know the true potential of children’s services: providing relationship support to help keep families together, helping new mothers struggling to adjust to parenthood, working with families and communities to protect children from abuse or neglect, giving children in the care system a second chance at a happy and safe childhood, and care leavers a supported transition into independent living. I also know the impossibly difficult decisions that colleagues in local government are taking right now as they try to balance the books.

They will be thinking about where they can deliver dramatic savings as they have in most years of the past decade. The 2019 Conservative Manifesto committed this Government to champion family hubs. It is exactly this type of provision that is needed, but that councils find impossibly difficult to fund as there is no duty or resource to do so. Perversely, this inability to fund early intervention will increase costs to the public sector in the long run as emerging problems go unaided until urgent and crisis-based intervention is required, adding pressure on other services such as the police and A&E. The life-long human and financial costs associated with childhood trauma can be significant – we ought to reinvigorate our collective efforts to prevent this.

Councils have done an incredible job of maintaining support by a combination of creative partnerships with other councils, charities, and the private sector, but as we see in adult social care, rising costs and market conditions are creating significant headwinds.  We are already well down this path with the numbers of children in care the highest they have been for several decades and rising still, and the cost of care placements skyrocketing as demand outstrips supply; and as costs have risen we have not seen a corresponding improvement in outcomes.

Helping families is core to who we are as Conservatives. As a former Local Government Minister, the Chancellor will be very aware of pressures on council budgets. I recently spoke with a  number of Conservative colleagues heading Children’s Services in local government. They were each honest about the difficulty of the challenge before them and they were all too aware of the cost of failure.  But they were also proud in the knowledge that every day their teams are doing the best they can in unenviable circumstances for their families and vulnerable children. The Spending Review is Rishi Sunak’s moment to deliver urgently needed investment to place children’s services on a sustainable footing.  If we are to build back better for children and families we need to stabilise the foundations. Only then will we truly be able to stand with families through the tough times ahead and turnaround the outcomes of vulnerable children.