Budgets & fiscal events· Economy and public finances· Tax All gain, no pain? – the Chancellor’s cunning tax plan 16 November 2017 by Torsten Bell British politics is odd these days. But even by current standards something very unusual looks set to happen in next week’s Budget. A basic rule of British politics is that tax rises tend to happen soon after a general election, with the Chancellor betting that we’ll all have forgotten about them when the next election … Continued READ MORE
Budgets & fiscal events· Economy and public finances· Intergenerational Centre How Philip Hammond can strike a blow for intergenerational fairness in his Budget 13 November 2017 by Laura Gardiner With the dust beginning to settle on a scandal-focused fortnight in Westminster politics, attention is turning back to the big event looming on the horizon – Philip Hammond’s first Autumn Budget in 12 days’ time. The backdrop looks challenging, with the Chancellor having to deal with the headache of a likely downgrade to the economic … Continued READ MORE
Budgets & fiscal events· Housing Strictly Come Building: How housing can make a star turn in the upcoming Budget 9 November 2017 by Torsten Bell Lowering expectations ahead of a Budget always helps a Chancellor. And when it comes to expectations of Cabinet members, Boris Johnson and Priti Patel have definitely been in the lowering business. But others have made the Chancellor’s task harder rather than easier. Robert Chote, the chair of the Office for Budget Responsibility, is set to … Continued READ MORE
Household debt The Bank has increased borrowing costs, but is personal debt bubbling over? 5 November 2017 by Matthew Whittaker Following a period of double digit growth in consumer credit over the last year or so, there have been some concerns about the reappearance of a debt bubble in the UK economy. In truth though, household borrowing currently resembles less of a bubble and more of two day-old helium balloon: partially deflated and looking worse … Continued READ MORE
Pay It’s all about the wages, stupid 4 November 2017 by Torsten Bell Yesterday’s good news: the reason the Bank of England increased interest rates is because it thinks the growth in your pay packet is about to start picking up. The bad news: it doesn’t think they’re going to pick up very far because we’re just not very good as a country at improving how we produce … Continued READ MORE
Housing Helping or hindering? The latest on Help to Buy 3 November 2017 by Lindsay Judge When Sajid Javid announced last month that the government would allocate a new tranche of money to the Help to Buy (HTB) programme he claimed that this would enable “people to make their dream of owning a home a reality”. But is this expensive policy really doing ‘people’ any favours? When HTB was introduced in … Continued READ MORE
Macroeconomic policy Crunching the numbers on today’s rate rise 2 November 2017 by Matthew Whittaker Interest rates are up. It may be a very modest increase but, for any number of reasons, the news is big. Ten years on from the last rise, today’s 0.25 percentage point increase in the Bank’s base rate (taking it back to the 0.5 per cent it sat at between March 2009 and August 2016) … Continued READ MORE
Living standards· Macroeconomic policy The rate rise debate should prompt wider questions about the living standards impact of monetary policy 1 November 2017 by Torsten Bell Tomorrow the Bank of England is expected to raise interest rates for the first time in a decade, kicking off the first tightening cycle for monetary policy in 14 years. Whether or not the Bank’s Monetary Policy Committee behaves as markets anticipate, the expectation has triggered two big questions. First there is the macro question … Continued READ MORE
Welfare Time to make Universal Credit fit for purpose in 21st century Britain 31 October 2017 by David Finch The pace of the roll-out of Universal Credit (UC) has quickened in recent months – and so too have the complaints and reputational hit that the reform is taking. Much of the focus has been on the six week wait before new claimants moving out of work receive their first payment, which is the result … Continued READ MORE
Labour market· Low pay· Pay The national living wage has caused the biggest fall in low pay in 40 years – but how is this improving people’s living standards? 27 October 2017 by George Bangham Employment is at a 40-year high, while pay is stagnating. That, in brief, sums up the last few years of changes in Britain’s labour market. As Figure 1 shows, politicians rightly highlight that employment and unemployment are undeniably trending in the right direction. But the good news on employment has failed drastically to translate into … Continued READ MORE
Labour market· Low pay· Pay The latest on low pay 26 October 2017 by Conor D’Arcy To paraphrase the great Yogi Berra, making predictions is hard. That’s especially true of the future of the UK’s labour market. After all, the current combination of record high employment and falling real wages is not a forecast many economists would’ve made even a couple of years ago. But new Annual Survey of Hours and … Continued READ MORE
Labour market· Cities and regions Charting a course to better jobs in Greater Manchester 26 October 2017 by Stephen Clarke Andy Burnham, the mayor of Greater Manchester, has just announced that he is looking at creating a ‘GM Employers’ Charter’ to raise productivity and job quality in the region. As a first step the Mayor is seeking the views of employers, workers, trade unions and other experts, so it’s a good time to take stock … Continued READ MORE
Labour market We need to address Britain’s Jekyll and Hyde labour market 19 October 2017 by Conor D’Arcy The latest chapter in the British labour market’s Jekyll and Hyde story was published this week. New data on jobs, pay and inflation continued the plot of recent months: an impressively high employment rate twinned with woeful wage growth that’s unable to keep up with prices. But for one group at least, recent developments have … Continued READ MORE
Living standards· Brexit & trade· Economy and public finances There’s much uncertainty about a ‘No Deal’ Brexit, but what we do know would be bad for living standards 17 October 2017 by Torsten Bell Big change, means big uncertainty. Especially when that big change is being brought to the complex beast that is a major developed country in the 21st Century. To complicate the task further, in the case of Brexit Britain while we know big change is coming, we don’t know what form that big change will actually … Continued READ MORE
Budgets & fiscal events· Welfare Let it go Chancellor. Why Philip Hammond should revisit the benefit freeze in next month’s Budget 15 October 2017 by David Finch The weather might be un-seasonally warm just now, but millions of household budgets are in the grip of a four-year freeze that’s about to get colder still. For decades, the government’s default position has been to uprate the value of working-age benefits each April in line with the rate of inflation prevailing in the previous … Continued READ MORE
Incomes· Living standards Did raising tuition fees flatter measurements of young people’s incomes? 13 October 2017 by Adam Corlett The government has announced that the maximum annual tuition fee will be frozen at £9,250; and that the earnings threshold for repayment will jump from £21,000 to £25,000. What’s more, there will be a wide review of student finances to “look again” at this turbulent political issue. While they’re doing that, government statisticians should look … Continued READ MORE
Labour market· Skills Is the big fall in Apprenticeship starts a blip, or a sign of things to come? 12 October 2017 by Kathleen Henehan Since the implementation of the apprenticeship levy in May of this year, many have wondered how a shift in funding – with large employers in England being required to put 0.5% of their wage bill into an apprenticeship account – would affect the number and type of apprenticeships on offer. Today, we have first sight … Continued READ MORE
Productivity & industrial strategy· Economy and public finances· Economic growth The living standards cost of the OBR’s newfound productivity pessimism 10 October 2017 by Matthew Whittaker Rumours of attempts within the Cabinet to remove Philip Hammond may or may not be wide of the mark. But given the recent steady flow of disappointing economic data, the Chancellor could be forgiven for wanting to walk before he’s pushed. Last week’s PMI data and today’s short-term indicators from the ONS both suggested that … Continued READ MORE
Living standards· Labour market· Inequality & poverty Black and ethnic minority workers needs a bigger living standards reward for their astounding progress in getting degrees 7 October 2017 by Kathleen Henehan and Helena Rose On Tuesday, the Government will publish an audit of race disparity across public service outcomes. The data, which will be publicly available, outlines race-based inequality in health, education and employment services, and within the criminal justice system. This is a very welcome development: previous Resolution Foundation research found that such disparities are very real when … Continued READ MORE
Living standards· Incomes· Inequality & poverty· Brexit & trade We’re getting poorer, but it’s not (just) Brexit 6 October 2017 by Matthew Whittaker Amid a busy week in politics, the publication this week of new data showing that average household income per person has fallen in each of the last four quarters has passed somewhat unremarked upon. As the chart below shows, annualised income fell by 0.3 per cent in the second quarter of this year relative to … Continued READ MORE
Housing An additional £2bn for affordable housing – a big deal or just small fry? 5 October 2017 by Lindsay Judge It’s the morning after Theresa May committed an additional £2 billion to affordable housing, so is this a big deal or just small fry? The announcement is clearly significant in a number of key ways. First, this money represents a sizeable bump to the £7 billion the government had already pledged over the parliament for … Continued READ MORE
Housing· Intergenerational Centre Social housing for the younger generations? 4 October 2017 by Lindsay Judge Social housing has received much well-deserved attention over the conference season and even looks set to be the star of the show in Theresa May’s speech. But while the rise and fall of the sector is a familiar story, the intergenerational consequences of its course are rarely remarked upon. With our new research showing that … Continued READ MORE
Living standards· Intergenerational Centre Why intergenerational fairness is rising up the agenda, in 10 charts 30 September 2017 by Laura Gardiner The prospects of today’s younger generation is a topic that graces newspaper headlines and politician’s speeches with increasing regularity. In the middle of party conference season, here’s a 10-chart guide to where the concern is coming from and what those seeking to address the challenge should be focusing on. Jobs and pay Young people were … Continued READ MORE
Childcare· Welfare A hat-trick of childcare policies are being rolled out this Autumn. But is the current approach an expensive own goal? 28 September 2017 by David Finch Childcare support is all the rage. As well as being the focus of one of the key policy announcements at Labour Conference this week, the government is rolling out not one but three new policies this Autumn. Even in these austere times, the government is spending £2bn on the introduction of Tax Free Childcare and … Continued READ MORE
Living standards· Political parties and elections For Labour, it’s all about what you say 23 September 2017 by Torsten Bell Labour members heading to Brighton this weekend will be a historical anomaly. Because they will be perky. That isn’t the word you’d normally associate with Labour party members on the eve of party conference for the last decade. Depressed, occasionally. Determined, often. But perky? No. And fair enough. Just 15 weeks ago they learnt that … Continued READ MORE
