Home

The Government has announced that new mathematics and physics teachers working in the most deprived areas will be given a £2,000 retention payment in a bid to improve recruitment and retention.

Ryan Shorthouse, director of Bright Blue, the independent think tank for liberal Conservatism, recommended in April 2017 to provide a new salary supplement for teachers working in under-performing schools.

Commenting, Ryan Shorthouse, Director of Bright Blue, said:

“The quality of teaching is the most important factor at school for shaping children’s long-term attainment. But there is a real problem with recruiting and retaining teachers, especially in less advantaged areas of the country. Ambitious, talented teachers need to be incentivised to teach in state schools in struggling areas. Evidence shows salary supplements can help.”

Bright Blue, the independent think tank for liberal conservatism, welcomes the Net-Zero report by Committee on Climate Change (CCC), which recommends a new, net-zero emissions target for the UK.

Commenting Ryan Shorthouse, Director of Bright Blue, said:

“Before she steps down, the Prime Minister has the opportunity to do something uncharacteristically bold: ensure the UK adopts a new, legal net-zero emissions target by 2050 at the very latest. Doing so would be the most critical and transformative policy her Government could implement. And it would be quintessentially conservative: helping to build a more sustainable and prosperous future for younger generations.”

“There is now a sound technological, scientific and legal basis for the UK adopting a new, legal net-zero emissions target in the coming decades. The latest IPCC report was clear: bringing emissions down to net zero before 2050 is necessary for meeting the below 1.5 degree temperature rise target agreed by the international community at Paris. And there is clear public support for doing so.”

“Achieving net-zero by 2050 will require the government to provide stronger incentives and investment for our energy system and heating sector. Energy consumers in the UK urgently need to end their reliance on natural gas. A low-carbon gas obligation needs to be introduced for the next Price Control Framework from 2021, to ensure greener gas such as biomethane, bioSNG and hydrogen play a much larger role in our energy supply.”

“While the recent commitment to not connect any new houses to the gas grid from 2025 onwards is welcome, this does nothing for the majority of the existing housing stock that remains connected. There is an absence of government policy to incentivise energy efficiency measures, especially since the end of the Green Deal. The Government should create new ‘Help to Improve’ loans and ISAs. These would support major new household investments in smart appliances, solar panels, heat pumps, biomass boilers, and battery storage, as well as energy efficiency measures such as double glazing and solid wall insulation.”

Bright Blue’s 2018 report Hotting up included polling showing that a clear majority (64%) of the UK public support reducing our emissions to zero in the next few decades. This report advocated that there was a sound scientific, technological and legal case for the adoption of a new, legal net-zero emissions target by 2050 at the very latest.

Bright Blue’s 2019 report Pressure in the pipeline proposed new policies to deeply decarbonise the demand for and supply of UK gas: Establish a ‘low carbon gas obligation’ on gas suppliers in the next price control framework from April 2021 to incentivise the injection of low carbon gas flowing in the UK gas network; Make decarbonisation of UK gas a priority for Ofgem in the next price control framework from April 2021, including by increasing the available funding through the ‘Network Innovation Competition’ and ‘Network Innovation Allowance’; Amend the Gas Safety (Management) Regulations and the Gas (Calculation of Thermal Energy) Regulations to enable a higher proportion of low carbon gases to flow in the gas network; Introduce ‘Home Affordability Assessments’ (HAAs) alongside a new HAA rating; and, increase the requirement for domestic gas boilers to be 95% efficient.

Bright Blue’s 2016 report Better homes proposed new policies to incentivise energy efficiency measures, such as: Introduce minimum energy performance standards for properties at the point of sale and when other renovations on the property are carried out; Introduce ‘Help to improve’ loans; Introduce a new ‘Help to Improve ISA’.

Bright Blue Scotland, the independent think tank for liberal conservatism, has today published new research, entitled Our still United Kingdom, proposing new constitutional arrangements for the UK after Brexit.

The report, authored by Murdo Fraser MSP, argues that current constitutional arrangements – including Joint Ministerial Committees establishing 24 new post-Brexit Common Frameworks – are proving frustratingly inadequate. The report claims that if further constitutional reforms are not introduced, there is a risk of inflaming support for separatism in different parts of the United Kingdom.

The report rejects moving the UK towards a federal system that is seen in Australia or Canada, but instead proposes a quasi-federal settlement for this country which could also finally solve the ‘West Lothian Question’ and reform the House of Lords.

The report makes four main proposals to achieve a new post-Brexit, quasi-federal UK:

1. A new Statute or Charter of Union. This new Act of the UK Parliament would declare the creation of a quasi-federal state, and provide in law for the UK’s intergovernmental machinery.
2. A new Senate representing different parts of the UK. The House of Lords as it currently exists should be abolished and replaced with a new Senate, or Upper House, representing different parts of the UK, predominantly if not entirely elected, and fulfilling the role both of a revising chamber and as a counterweight to the House of Commons.
3. A new UK Council of Ministers. The establishment of UK Common Frameworks requires the replacement of the existing Joint Ministerial Committee system with a new UK Council of Ministers, representing component parts of the country.
4. A new English Grand Committee. In the absence of significant further devolution or moves to federation within England, there is a need for England as a whole to be represented within the new UK Council of Ministers, with representatives elected by the English Grand Committee.

Commenting Murdo Fraser MSP, author of the report, says:

“Our departure from the EU will require new processes, and structures, to be created within the United Kingdom. With nationalists in different parts of the United Kingdom seeking to use Brexit uncertainty for their own political ends, it is important that unionists have a coherent response. So it is time to reform our government structures to create a ‘quasi-federal’ United Kingdom.”

“Introducing a UK-wide Senate delivers the long-awaited and overdue reform of the House of Lords, giving a better balance to the UK Constitution and protecting the interests of the nations and regions furthest from London.”

“A new English Grand Committee would finally resolve the West Lothian question, allowing the people of England for the first time a proper voice within the institutions of the UK, distinct from that of the UK Government.”

“A new quasi-federal settlement can mitigate concerns that exist in Scotland, Wales, and Northern Ireland, and also are growing in many parts of England, about an over-centralised state where, despite asymmetric devolution over a period of two decades, there is still pressure for more power to be passed down from the centre.”

Commenting Ryan Shorthouse, Director of Bright Blue, says:

“Our departure from the EU provides the impetus to introduce important governmental and constitutional reforms to create a ‘quasi-federal’ future for the four nations of the Union.”

“Notwithstanding the difficulties and divisions Brexit has created, it does offer an opportunity for overdue democratisation and modernisation of key institutions of the Union.”

Bright Blue, the independent think tank for liberal conservatism, welcomes the announcement in the 2019 Spring Statement of the Bright Blue policy of requiring an increased proportion of green gas in the grid.

Commenting Ryan Shorthouse, Director of Bright Blue, said:

“The Government has rightly adopted Bright Blue’s policy of an obligation on gas suppliers to ensure a certain proportion of green gas is in the grid. The detail is to come, but a new low carbon gas obligation on gas suppliers should be introduced by Ofgem in the next price control framework from April 2021.

“This low-carbon obligation should include a requirement for gas suppliers to deliver a steadily increasing proportion of low carbon gases – which includes biomethane, bioSNG and hydrogen – to the network. The proportion of low carbon gas injected into the gas network, and the trajectory for this over time, should be consistent with meeting the UK’s current and likely greenhouse gas emissions reduction target.”

Last month, Bright Blue published a new report, Pressure in the pipeline: decarbonising the UK’s gas. In response to this report, the Rt Hon Claire Perry MP, Minister of State for Energy and Clean Growth, said:

“I welcome this thought provoking work from Bright Blue. Through rapid progress in decarbonising power generation, the UK has grown its economy whilst cutting carbon faster than any other country in the G7; but if we are going to build on this success, we need to get serious in tackling heat. This welcome report points to policy solutions that build on the strength of our natural gas sector where we are a world leader, and the hugely valuable assets of our gas networks.”

“Hydrogen and Biomethane can help deliver serious climate action through our existing infrastructure, keeping consumers on board and maintaining the flexibility and resilience provided by the gas system.”

Bright Blue, the independent think tank for liberal conservatism and home of conservative modernisers, has today published a report, Helping hand? Improving Universal Credit, based on new and extensive analysis of 40 depth interviews with a broadly representative sample of current claimants in England.

This report explores the impact of the unique and key design features of Universal Credit (UC) during three critical stages of the claimant experience: accessing, managing on, and progressing on UC.

This report is unique in three ways. First, on the breadth of claimant experiences and attitudes captured in our depth interviews. Second, on the diversity of claimants interviewed, including the self-employed. Third, on the focus being on key and unique design elements of UC, rather than financial support.

The main findings from the depth interviews include:

• Most claimants are coping with and adapting to UC. There are positive experiences, especially with work coaches. And there are positive attitudes too: especially towards the single payment model and the need for conditionality. Common descriptions of UC deployed by our interviewees included “helpful”, “straightforward”, “smooth” and “easy”.
• There is a significant minority of claimants that are struggling with certain key design features such as the online nature of UC and monthly payment in arrears, either initially or in the long-term. There were claimants with socio-demographic characteristics that especially seemed to struggle with key design elements: claimants that were older, long-term unemployed, self-employed and with mental or physical health problems. It was typical for such people in our fieldwork to assert that UC was “confusing”, “stressful”, “challenging”, and “unsettling.”
• The biggest challenge faced by claimants is the initial waiting period of at least five weeks, which most claimants in fact struggle with. There are three issues related to this: the official length of time; the majority use of advance payments to cover this time; and, further delays above and beyond the official time caused by errors, which a third of our interviewees experienced.
• A clear majority of our interviewees felt that the housing element of UC should be the reverse of the new status quo and be paid directly to landlords. This was true even of interviewees who did not personally struggle to pay their rent. There was a strong belief that, in this respect, the legacy system is better.
• Awareness of and use of Alternative Payment Arrangements was very low. Alterative Payment Arrangements can be requested by claimants for more frequent payments, split payments, and direct payments to a landlord.

The report proposes policies that seek to improve the experience of the significant minority of claimants that are dissatisfied and struggling with key and unique design features of UC, as well as seek to ensure the positive experiences many claimants have can be enjoyed by others.

Commenting Ryan Shorthouse, Director at Bright Blue and co-author of the report, says:

“Universal Credit has plenty of potential. A majority of claimants are coping with and adapting to Universal Credit. There are positive experiences with work coaches. And there are positive attitudes too: especially towards the single payment model and the use of conditionality.”

“However, as it has gone from idea to implementation, the initial widespread support Universal Credit enjoyed has dissipated. Despite welcome improvements made by the  Government in recent years, there are too many examples and too much evidence of significant hardship experienced by a sizable minority of those on Universal Credit.”

“The initial waiting period for the first Universal Credit payment is causing the most difficulty. There is a substantial minority of claimants who are older, unemployed and with mental and physical health conditions that are struggling with certain key design features, such as the online nature of Universal Credit and monthly payment in arrears.”

“Especially as its fiscal approach towards welfare has happily been revised in recent years, the current Government has an important window of opportunity, before rollout accelerates, to invest in introducing significant changes to key design elements of Universal Credit.”

Bright Blue’s main recommendations in Improving Universal Credit are:

• All new claimants of UC should receive a one-off upfront ‘helping hand’ payment

We recommend that all new UC claimants should be offered a one-off ‘helping hand’ of equal to 25% of their estimated initial UC award. This would be equivalent to a week’s worth of their future UC award payments. This ‘helping hand’ would be paid as soon as possible after successfully registering on UC to the claimant’s chosen bank account, would be non-repayable, and could only be received once by a claimant over a long time period.

• Claimant commitments should be rewritten to include obligations of individuals and institutions that support UC claimants. If these obligations are not met, Independent Case Examiners should determine whether compensation to claimants is paid in their next UC award

We recommend that claimant commitments are rewritten to reflect not only the obligations of claimants, but also the obligations of the individuals and institutions that are delivering UC. For work coaches, for example, this could include their commitment to respond to the entries in the online journals of UC claimants, or facilitate suitable training or work experience, within a specified time period. For the DWP, this should include the obligation to pay claimants their UC award – especially their initial award – on a specified date.

Claimants should be able to seek redress via an Independent Case Examiner, who could investigate and determine whether financial compensation should be paid to them in a future UC award. The amount of compensation issued to UC claimants should to some degree mirror the amount lost by claimants because of sanctions. Specifically, the financial compensation offered to claimants as a result of non-compliance by DWP should be tiered according to the number of weeks a claimant has waited for their UC award.

• Enable claimants, through their online accounts, to grant continuous explicit consent for their advocates and to opt-out and personalise the default frequency and destination of their future UC awards

We recommend that all claimants have the power, through their online UC accounts, to grant continuous explicit consent for their advocates and to alter the frequency and destination of their UC award payments before they receive it in their bank accounts.  This would enable claimants to have control to change relatively quickly two aspects of the way they receive their UC awards before they receive it in their bank account. First, how frequently their UC awards are paid, enabling monthly or fortnightly payments. Second, the destination of different elements of their UC award, enabling different amounts specified by the claimant to be paid into up to three different bank accounts. These different bank accounts could include: an alternative current account, which belongs to them or their partner; a savings account, which belongs to them or their partner; and, the bank account of their landlord. This enables all claimants, without any conditions, to instigate relatively quickly split and managed payments.

• Introduce a live chat facility in the online UC account for claimants with queries and problems

We recommend that the government introduce a live chat facility within online UC accounts, so claimants can get their queries and problems addressed almost anytime and anywhere.

• Introduce a new mobile phone app for people to access their UC online account

We recommend that the DWP develop, or commission a competitive tendering process for a third party organisation to develop, a new mobile app which provides claimants with access to their online UC account.

• Cap the number of UC claimants all work coaches can be assigned

As of March 2018, work coaches had an average caseload of 85 claimants. By 2024-25, the NAO has forecast this will increase dramatically to 373. Such a dramatic expansion in caseload risks jeopardising the generally positive relationships which have characterised claimants’ experiences of UC to date and, ultimately, the success of UC in improving employment rates.

We recommend capping the number of UC claimants a work coach can be assigned.

• Ensure there is a full-time disability and mental health specialist employment adviser in every Jobcentre Plus

Though DWP initially intended to remove all specialist advisers, including lone parent and young people advisors, they have recently reversed their decision to remove disability advisers. As of July 2018, there were 458 full time equivalent disability advisers across 637 Jobcentre Plus’s. Due to the significant and positive role that disability specialist employment advisers play, we recommend that every Jobcentre Plus should have a full-time disability and mental health employment adviser.

• Introduce a disregard for the repayment of UC overpayments where DWP is responsible for the error

Under the legacy system, up to £2,500 a year is disregarded from the recovery of any overpayments of tax credits. This disregard does not exist under UC. We recommend that overpayments in UC caused by official error should be disregarded up to a certain value.

• An ongoing out-of-work claimant, or claimant that still needs to find further work, should be awarded a supplement on their future UC awards if they are consistently meeting the most demanding conditions around job seeking and preparation set by their work coach

At the moment, there is a penalty of being sanctioned and losing your benefit income for not fulfilling conditionality requirements. There should be greater rewards, not just sanctions, built into conditionality requirements. We recommend that a small but significant supplement is added to all subsequent UC awards of out-of-work claimants, and those who are required to find further work, who consistently meet the most demanding conditions around job seeking and preparation set by the work coach.

The supplement should be awarded after a set time period and only when the claimant is out-of-work, or – in the case of those required to look for further work – until their in-work conditionality requirements are met. This would therefore be rewarding claimants who are putting in maximum effort but have been simply unlucky in securing appropriate employment. Those claimants that refuse to take up suitable employment that has been offered to them, even after complying with their conditionality requirements over a set time period, will not be eligible for the supplement.

• Enter all claimants who are consistently meeting the most demanding conditions around job seeking and preparation set by their work coach into a new biannual UC prize, where a handful of claimants win £1,000

We recommend that those out-of-work claimants, as well as in-work claimants who are required to look for further work, who consistently meet the most demanding conditionality requirements over a set time period should be entered into a biannual prize. Eligibility would be similar to the aforementioned supplement, but with this policy even those who go on to secure work and even leave UC will be eligible to be entered into the prize. A handful of winners across the country will be announced every six months, each winning a £1,000 prize. Claimants will only be able to receive one prize in their lifetime.

• Extend the 12-month exemption from the Minimum Income Floor (MIF) for self-employed UC claimants, so a further separate 12 months of exemption can be claimed at any point in their lifetime while an individual is on UC, after approval from a claimant’s work coach

The existing 12-month grace period preceding the activation of the MIF is intended to give self-employed claimants the time to develop profitable businesses. The MIF is then intended to prevent UC being used to prop-up unsuccessful businesses. Rather than providing claimants with an extended grace period before the MIF applies, we recommend that UC claimants are given an additional but separate 12 months’ exemption from the MIF after the grace period. Claimants will be able to choose which months the exemption will apply. They will determine the months for any point in their lifetime when they are on UC. Claimants would only be eligible for these 12 additional months once in their lifetime, regardless if the nature of their self-employment changes, but they do not have to be taken all at once.

Bright Blue, the independent think tank for liberal conservatism, has today published new research, entitled Tackling intergenerational inequity at its roots, calling on the Government to introduce reforms to mitigate the intergenerational inequity that is resulting from government spending.

The research, authored by Associate Fellow Michael Johnson, outlines the vast, and continuing, growth in unfunded spending promises by government, notably in respect of pensions.

The research argues that the nation’s financial health is better assessed using HM Treasury’s ‘Whole Government Accounts’ rather than the ‘National Accounts’, since it includes several unfunded promises. In the Whole Government Accounts, the nation’s net liability more than doubled in the six years to the end of March in 2017 to £2,421 billion; this figure is equivalent to 120% of GDP and £89,000 per household. But this net liability figure excludes the State Pension. Include this, and the UK’s net liability would have leapt to over £6,600 billion at the end of March 2017, some £243,000 per household.

The report proposes makes five main proposals to prevent the ongoing perpetration of intergenerational injustice in the nation’s finances at source:

1. The UK should introduce ‘Intergenerational Impact Assessments’ (‘IIAs’) to accompany draft legislation as it proceeds through Parliament

Prospective legislation is accompanied by a regulatory ‘Impact Assessment’ (‘IA’), an evidence-based document designed to improve the quality of regulation by quantifying its costs and benefits. IAs do not, however, explicitly quantify the extent to which costs are being deferred, and thus the financial impact of legislation on the young, as future taxpayers.

The expressed purpose of IIAs would be to highlight prospective legislation’s cost, efficiency and fairness for future generations. These IIAs would be prepared by a new ‘Office for Fiscal Responsibility’ (‘OFR’), described below.

A key objective for IIAs would be to improve transparency, a prerequisite for any meaningful debate about how longer-term unfunded commitments are to be met and by whom.

2. A new Office for Fiscal Responsibility (OFR) should pursue a tax simplification agenda alongside an examination of the effectiveness and value for money of all tax reliefs, and also coordinate the production of Intergenerational Impact Assessments (IIAs).

There are over 1,100 tax reliefs. HMRC expects tax reliefs to cost a total of over £425 billion in 2018-19, the equivalent of 52% of expected tax revenues of £810 billion for 2019-20.

Parliament has little insight as to whether tax reliefs are working as intended, what they cost and whether they represent good value for money. There needs to be greater oversight of tax reliefs. But the question remains as to whether HMRC is best placed to do this. The role would probably be more appropriately conducted from within an enhanced Office for Tax Simplification (OTS), which could be renamed the ‘Office for Fiscal Responsibility’ (‘OFR’).

To be clear, decisions on tax policy and legislation should remain a matter for the Chancellor. The new OFR would be to provide the Chancellor with supporting material (including IIAs) and recommendations. An ORF should exude an ethos of fiduciary duty towards current and future taxpayers, and aspire to a reputation for independence akin to that of the Office for Budget Responsibility (OBR).

3. After five years, each and every tax relief would automatically cease

A revolving programme of tax relief reviews by the OFR could be set in train by attaching a five-year sunset clause to all tax reliefs, distributed throughout a parliamentary term to even out the OFR’s workload. It would then be for politicians and policymakers to periodically remake the case for them. For some of the structural reliefs, this should be a purely perfunctory exercise.

4. Departmental budgets should be set both gross and net of expenditure on tax reliefs and exemptions, to ensure transparency as to the true level of financial support to each area of public policy

Taxpayers deserve regular, thorough and systematic scrutiny of the effectiveness and value for money of all tax reliefs.

Departmental annual budgets are set without taking into account the cost of relevant tax reliefs. This disconnection is extraordinary, and surely leads to resource misallocation, as well as rendering meaningless any value for money exercises.

5. The UK’s Whole of Government Accounts (WGA) balance sheet should include a liability to represent future State Pension payments, based upon a realistic expectation of the future cash outflow, discounted using gilt yields.

Bizarrely, the State Pension, the largest of all unfunded liabilities (roughly £4,200 billion at the end of March 2017), is excluded from the WGA. The State Pension is excluded from the WGA because it is deemed to be a benefit (‘welfare’) rather than an obligation. The State Pension liability escapes the WGA, seemingly on a technicality. But, that aside, it still has to be met, through taxation. Consequently, in the interests of transparency, it should be included in the WGA.

Commenting Michael Johnson, Associate Fellow of Bright Blue and author of the analysis, says:

“If the UK were accounted for as a public company, it would be bankrupt. There is no evidence to suggest that the torrent of unfunded promises and provisions being made by Parliament will abate anytime soon. The perpetration of intergenerational injustice continues unabated.”

“We need to put a brake on deferring costs that millennials in particular will otherwise have to meet. We need to tackle this ongoing perpetration of intergenerational injustice at source, through policies operating right at the heart of the legislative process that will arrest Parliament’s output of unfunded spending commitments and provisions.”

Commenting Ryan Shorthouse, Director of Bright Blue, says:

“The Conservative Government should not be complacent about the ongoing need to reduce the budget deficit. Balancing the books is not simply neat accounting. It is of fundamental economic and moral importance.”

“If we do not eliminate the budget deficit in the near-term, it is younger generations who will have to pay more – through tax rises or spending cuts – in the future. Forgetting deficit reduction will only exacerbate the growing intergenerational inequity that is emerging in modern Britain.”

“It is common to hear politicians and policymakers complain about intergenerational inequality. But warm words are not enough. A set of bold and original policies are necessary.”

Commenting The Rt Hon Nicky Morgan MP, Chair of the Treasury Select Committee, says:

“Growing intergenerational inequality in Britain is now well-documented and widely discussed. It is time that politicians address it, not least by exerting tighter control on public spending. This will reduce the risk that future generations will face excessive tax rises or cuts to public services.”

“Intergenerational Impact Assessments to accompany prospective legislation as it passes through Parliament will add a new dimension to scrutiny and debate. Politicians should be open to having as much clarity as possible about the consequences of their spending decisions for future taxpayers.”