Interesting Blog from New Philanthropy Capital
What Will Spring Statement the Spring Statement Mean for Charities.
Thank you to NPC for allowing us to share this. For more information click here:
Spring is upon us. Flowers are blooming, birds are finally singing—and the sound of tweeting will reach deafening levels this week as the change of seasons also brings a new Spring Statement from the Chancellor. But as new beginnings go, the outlook has looked brighter.
A lot has happened since the somewhat optimistic-feeling autumn budget, and not much of it has been good for the charity sector: a war in Europe, the subsequent economic and social fallout, and spiralling living costs across the country. With this backdrop, ‘levelling up’ has dropped down the agenda, but it cannot be forgotten. More than ever, we need to see the budget deliver for marginalised groups who are most vulnerable to these social and economic shocks.
What will be the big themes of the budget?
In the short term, the overall economic outlook is pretty bleak. Inflation is rising to 30-year highs and may hit double digits, with another spike likely in the autumn. Disposable income is set to see the largest annual fall in 50 years. The government already announced a rise in the National Insurance rate—and although they may be scrapping this for the lowest paid workers, it will provide little salvation to those most affected by rising costs. The Chancellor has teased that rising food and fuel prices are likely to be confronted with a package of support, in addition to the £350 package announced in February—which now seems like a drop in the ocean. However, rumoured defence spending rises and support for Ukraine may limit the Treasury’s ability to ease people’s concerns.
We also have huge labour market vacancies, with around 1.2 million fewer people in the labour market compared to pre-pandemic trends. This is driven both by the young, but also by over 50s who have left the labour market completely. The Treasury will likely be thinking closely about this and an update to the plan for jobs is expected on Wednesday.
What should charities be expecting?
There may be tough times ahead for the charity sector. The combination of rising costs, rising demand and inflation, leading to a decline in value of grants and donations, could be a serious one for charities. What is certain is that as an abstract ‘cost of living crisis’ moves into a desperate ‘can’t heat my home’ crisis, charities will be ever more in need.
Along with the support for household bills already mentioned, there have been some rumoured benefit changes which the Chancellor may employ to try and soften the blow. For example, lowering the taper rate of Universal Credit again, or raising child benefit or pensions, but in the short term this is unlikely to seriously alter the circumstances of many people that charities support.
Charities whose work concerns Ukraine should also expect specific announcements around the crisis—both in terms of more support for resettling people in communities here, and also in terms of increased aid for organisations working closer to Kyiv.
What about levelling up?
With everything else that’s in the news, the mission to ‘level up’ the country has fallen down the agenda. However, the pain people will be feeling over the coming months means that this support is needed more than ever.
The largest levelling up fund yet to be allocated is the UK Shared Prosperity Fund (UKSPF). This is meant to replace EU funding for business support, community infrastructure, and employment and social exclusion support. The prospectus for the UKSPF is due soon, and allocations to lead authorities may be made as early as the Spring Statement. Given the labour market vacancies, this would be welcome.
What may be missing, however, is support for tackling social needs. In the pre-launch guidance for the UKSPF, the government quietly revealed that new funding for people and skills may not be available until 2024 / 25. As we outlined in our recent briefing, this could leave a three-year gap in new funding which will affect the most marginalised in the country the most, and will risk progress on the levelling up agenda.
At NPC, we’re worried this is going to blunt charities’ ability to deliver for communities around the country at a time when they are needed most. Following on from our briefing, we will be running an event on the UK Shared Prosperity Fund next month, focused on how charities and local government need to work together to ensure people don’t lose out on support. This will be vital viewing for anyone trying to tackle social exclusion or improve employment in communities around the country. Further details announced soon.
Longer-term, we are focused on ensuring that the lessons from projects working on social issues around the country are kept at the heart of future levelling up plans. Later this year, the government will be launching its Strategy for Community Spaces and Relationships. We know how much there is to learn from work that’s already happened, and we will be pulling together best practice from community initiatives across the country, along with fresh thinking, to design plans that can genuinely tackle the social needs that people see as key to the success of levelling up.
The Spring Statement is unlikely to bring a new start for the charity sector, but we know many charities have already planted seeds which address the issues communities care about. We want to help them grow and thrive elsewhere.
Get in touch with Theo.Clay@thinkNPC.org if you want to learn more.
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Spotlight on 4in10 Member Praxis and the NRPF Action Group
How are you helping to tackle child poverty in London?
Praxis is a charity for migrants and refugees. We provide immigration advice, housing and peer support and through all of these ways our work helps to protect children from poverty. We have become a leading expert in finding pathways out of destitution and supporting migrants facing homelessness, and our training and campaign work has national and international impact. Our core purpose is to help migrants in crisis or at risk, ensuring they can live in safety, overcome the barriers they face, and take control of their own destinies. You can read more about our strategy here, find us on Facebook, Twitter and our website here.
As part of this work, we facilitate the No Recourse to Public Funds Action Group, which is made up of campaigners with lived experience of the No Recourse to Public Funds (NRPF) policy, to build campaigns to end this policy. You can find out more about our campaign, and read the NRPF Action Group’s manifesto calling for the end of NRPF here.
Tell us something you are excited about?
We are really excited that the group has decided to focus on campaigning for free school meals. The overarching goal of our campaign is to ensure free school meals for all children living in poverty, regardless of their parents’ immigration status. We’re launching with a specific call to the Government to make permanent the temporary extension of free school meals to some groups of children living in poverty affected by No Recourse to Public Funds, which was brought in during the pandemic.
We are also calling for free school meals for all children in poverty, regardless of immigration status, to take into account the fact that children with insecure immigration status are not covered by the extension of eligibility.
Our policy briefing sets out our campaign asks in more detail – you can find that here;
Additionally, here are some posts you can share if possible:
- Facebook: https://www.facebook.com/PraxisCommunityProjects/posts/325409016299148
- Twitter: https://twitter.com/Praxis_Projects/status/1500765019050500096
- Instagram: https://www.instagram.com/p/CazDWYtoCQa/
- LinkedIn: https://www.linkedin.com/feed/update/urn:li:activity:6906533946969186304
If you can support our campaign on social media, in your email networks and newsletters, this would be hugely appreciated! Please do reach out if you would like to collaborate in any way!. Any support you can offer to our campaign is hugely welcomed and thank you for all you do – Pascale.robinson@praxis.org.uk
Share with our members something positive about your organisation’s achievement or service?
We were one of the organisations that helped to uncover the Windrush Scandal originally and we’re proud to have been part of the work to campaign to change the system.
What can other network members learn from you or find out more about through you?
- We can offer advice for those who need help navigating the migration system: Get Help — Praxis for Migrants and Refugees.
- We are experts in finding pathways out of destitution and supporting migrants facing homelessness. Please reach out to collaborate on this!
- We can offer training on the immigration system for a variety of organisations (depending on our capacity).
What would most help you achieve your goals?
We want to make sure that migrants can live in safety, overcome the barriers they face, and take control of their own destinies. To do this, we campaign for systemic change. We’re building alliances and working in partnership with experts by experience to create positive, long-term changes to the policies and practices that create exclusion and destitution. We’d love to collaborate on work to achieve these goals!
Why did you join 4in10? What do you enjoy about being part of the 4in10 network?
Though we have only been in contact with the 4in10 team for a short while, 4in10 has already provided a brilliant chance to forge connections and collaborate with other amazing organisations working in the capital!
We are so looking forward to working together more, especially on our campaign to make sure all who need them have access to free school meals regardless of their immigration status.
Fantastic 4in10 Coffee Morning on Child Care
4in10 Coffee Mornings are always full of great people and good things. Just to wet your appetite for future ones and to give you some insight into why we chose child care as the issue for today you can find the slides below.
Thanks to Steve Triner from Sutton CAB and Samantha Creme from the London Early Years Foundation.
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Proposals for a new Bill of Rights: what would it mean for children living in poverty in London?
Katherine Hill, 4in10’s Strategic Manager, takes us through the issues:
The story of Human Rights Act (HRA) reform has been a long and somewhat torturous one. Governments of various guises have been consulting on what changes might be needed since the mid-2000s, only a few years after the Act came into force. While the content of these proposals has changed over time the one constant has been that those who have made the effort to respond diligently to each round of consultation have almost unanimously concluded that there is no solid case for reform; the Act is doing the job it was intended to do, effectively defending ordinary citizens against the exercise of excess power or neglect by the state.
Most recently the Independent Human Rights Act Review (IHRAR) set up by the Government to take (yet) another look at the Human Rights Act reported that, “[t]he vast majority of submissions received by IHRAR spoke strongly in support of the HRA.” And the separate but concurrently running inquiry carried out by the cross-party Joint Committee on Human Rights concluded: “[t]o amend the Human Rights Act would be a huge risk to our constitutional settlement and to the enforcement of our rights”. Why, then, has the Government now published proposals for wide-ranging and significant changes to the way the Act works? We all know that evidence-based policy is out of fashion, but this seems to have gone one step further. It is embracing policy in that is in direct contradiction with the evidence. This is policy driven by ideology pure and simple.
At this, the temptation may be to throw up our hands and leave the beleaguered Human Rights Act to the hands of fate. What is the point of repeatedly making the case for it, only to be ignored? There are two reasons. Firstly, we must recognise that the case for effective human rights is one that needs to be constantly remade, it will never be a case of job done. Human rights, if they are to mean anything, must be a statement of collective values, an expression of our shared commitment to freedom, respect, equality, dignity and autonomy for all humans. For these to be transmitted from generation to generation there needs to be ongoing dialogue about them and what they mean in our modern world. Shying away from that conversation leaves the legal mechanisms we have for defending our rights vulnerable to attack.
Secondly, and more pragmatically, if we do not argue and win the case for the Human Rights Act, and these current proposals for reform come into force, ordinary citizens may lose the means to enforce their rights effectively. For those 4in10 exists to advocate with and for, families and children experiencing living in poverty in London, the consequences are potentially very serious indeed.
The proposed reforms aim in multiple ways to make it harder for people to enforce their rights. These include a proposal to introduce of a new step in the legal process requiring individuals to demonstrate that they had experienced “a significant disadvantage” before their case can go to court. Legal action can already only be taken if the individual is the “victim” of a human rights breach, so it is hard to view this as anything other than an attempt to deter people from enforcing their rights by adding a further legal hurdle to the process. This will disproportionately affect those experiencing poverty who are more likely to have their rights breached in the first place. To give just one example, children in the lowest income quintile are 4.5 times more likely to experience severe mental health problems than those in the highest.[1] It follows that some of those are more likely to experience mental health detention too, where their human rights – including the right to respect for private and family life (article 8) and right to liberty and security (article 5) – will be engaged. If children in these circumstances, who already find it very difficult to access justice, have to jump through additional hoops it will further diminish their ability to challenge their detention where they believe it is an unlawful breach of their human rights.
The Government’s proposals would introduce a two-tier system for enforcing human rights by restricting their use in the domestic courts by certain groups, including “foreign criminals” and those accused of illegal migration. This makes a mockery of the values underlying the whole notion of human rights. These are rights that everyone is entitled to enjoy regardless of economic or immigration status, gender, sexuality, disability or anything else. It follows that all should have equal access to the law to enforce them. If they don’t, the impact will be felt most by those on the margins, and especially the poorest children in our society. If the Government is more easily able to deport people without them being able to challenge this on the grounds of right to respect for private and family life (article 8), families may face the sudden loss of their main breadwinner, and children living in already financially precarious situations will be plunged into deeper poverty.
A key issue the Government seeks to address through its plans is that it wants to stop what is termed ‘judicial overreach’, that is the courts getting involved in decisions that are more properly the role of Government and Parliament, accountable as they are to the people. High on the list of things the Government believes it is best placed to make decisions about is the allocation of social and economic resources and it is particularly aggrieved when it thinks the courts seek to interfere in these issues.
The reality is however, that there is little evidence that this is what the courts in the UK are routinely doing. Recent cases that have examined welfare policy have often been unsuccessful, for example a challenge to the two-child limit (which does not allow welfare payments to be made to third and subsequent children) on the grounds that it discriminates against lone parents. The courts found these to be matters on which Parliament has deliberated and struck an appropriate balance. This may be very disappointing for those of us who believe that there should be a wider role for human rights in these matters, and that the right to an adequate income, a safe and warm home and access to healthy food meet basic human needs that should be enforceable whatever the colour of government in town. But it certainly does not support the Government’s argument for the need to curtail the powers of the courts, and the rights of individuals, as is proposed.
Over the longer-term we need to build the case and argue robustly for more comprehensive protection of these important economic, social and cultural in our domestic legal framework, as an essential element of any strategy to eradicate poverty. But first, and most urgently, we need to protect what we already have in the form of the Human Rights Act, as failing to do so will have the greatest impact on those who most need to rely on it.
To find out more about the Government’s plans to reform the Human Rights Act and to find out how you can respond to the consultation visit the British Institute of Human Rights dedicated web pages where you can find lots of easily digestible information and advice.
[1] Gutman, L., Joshi, H., Parsonage, M., & Schoon, I. (2015). Children of the new century: Mental health findings from the Millennium Cohort Study. London: Centre for Mental Health.
4in10 Newsletter 6th Jan 2022
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4in10 Newsletter 09/12/21
4in10 Newsletter with data, reports, research, job vacancies, funding oopportunities and more. To read this issue click here. To receive the newsletter fortnightly straight to your inbox, join 4in10, London's child poverty network. It is completely free and gives advance notice of training and events and much more.
Timewise Video on Flexible Working
Timewise Webinar
Can flexible working help towards supporting low paid workers to progress and move out of poverty? Presenting the flexible working index and a discussion about flexible working as a real alternative.
https://timewise.co.uk/article/flexible-job-index-2021-a-timewise-roundtable/
Putting the onus on employers to enable all jobs to be flexible and for flexibility not to be a barrier to progression or keep people (mostly women) trapped in low paid work.
Fair By Design Blog. Innovation, fairness and a just transition to Net Zero
Fair By Design – The Poverty Premium.
Martin Coppack is Director at Fair By Design and Carl Packman is Head of Corporate Engagement and this article originally appeared on the Social Market Foundation website.”
By their very nature, essential services such as energy, credit, and insurance, are needed by everyone. However, these markets have been designed in a way that results in many people being treated less fairly. As Fair By Design’s research shows, poorer people pay more for products and services than those who are better off – known as the poverty premium.
The University of Bristol found that the poverty premium affects almost every low-income household, costing an extra £490 a year, on average. Low-income households experience the poverty premium in the energy market in a number of ways. They may use pre-payment meters for domestic fuel rather than paying by direct debit, or may prefer to pay on receipt of a bill to help manage a budget. Many low-income households are also not switched to the best fuel tariffs, which is also a poverty premium. These households are less likely to switch sometimes because they have other more pressing issues to deal with, which manifests in less capacity to engage in the market, which is known as the ‘scarcity mindset.’[1] It is not the same as consciously avoiding actions that might upset tight financial control, such as switching providers. They also may not be able to switch because of higher rates of digital exclusion, owing to a lack of ability or equipment to go online.
Research commissioned by Fair By Design found that people with certain protected characteristics are more likely to be paying a poverty premium, even when compared with low-income households as a whole. People from Black, Asian, and other ethnic minority households are more likely to be paying extra costs for energy, and paying on receipt of a bill, rather than by direct debit, which is usually cheaper. Single parents are more likely to pay for energy through more expensive prepayment meters. These groups are more likely to be in low-paid or insecure work and therefore need flexible payment methods to help keep control of their finances. Disabled people are more likely to be paying by either of these methods, than non-disabled people.
The poverty premium is particularly pertinent at the moment since poorer households suffer disproportionately in hard times. There are now millions more people facing economic hardship as a result of the pandemic. The ongoing gas price crisis means that the cost of heating the average home could also double.
Why does the poverty premium exist?
Essential products and services are too often designed for ‘super consumers.’ These are people who never become ill, always have a steady income, are able to understand complex terms and conditions and always have the time and technology to easily find the best deal. This is not a reality for everyone. There is a disconnect between social and regulatory policymakers and people’s lived experiences of poverty and exclusion, and a belief that a market based on competition benefits all consumers. In practice, firms compete for the most profitable and engaged consumers. It means that for many people products and services do not meet their needs or even that they are excluded altogether.
Inclusive Design: Understanding how different groups and consumers experience products
Across essential services regulators, inclusive design is increasingly recognised as a way to ensure markets are fair and inclusive, especially for consumers in vulnerable circumstances and on low incomes.
Inclusive design is a toolbox that helps design products and services that are accessible to as many people as possible. It is different to ‘traditional’ market research in that it is not simply about testing pre-existing solutions and hypotheses. It starts by talking to people with additional needs to understand the problems from their perspective, and designing from there. Rather than shaping the consumer around the product or service, firms start with people where they are, and co-design with them. This is especially important as the energy system becomes increasingly digitised, and we transition to net zero.
Instead of designing for a mythical ‘average’ user, firms should therefore understand people’s actual experiences and how these might put them at a disadvantage. In other words, what are they vulnerable to, and why?
There are huge benefits to firms from adopting an inclusive design approach. By involving customers in the process of product design and development, it increases the likelihood of adoption, and reduces the need for solving problems after they occur, through customer service, for example.
The role of government and regulators
At the same time we know that firms will only design inclusively, to a point. There are always going to be some consumers that are deemed less desirable and for whom competition alone will not help. Markets need to be regulated to serve everybody. This means that Government (BEIS) and regulators (Ofgem) should not only be encouraging firms to design inclusively, they should be applying inclusive design principles to their own work. They should shape their own policies around the consumer, especially those most vulnerable and least heard – rather than trying to make such consumers fit their desired regulatory intervention. It is not enough to rely on competition and the belief that empowered consumers drive the market.
For instance, consumers have a role in designing the appropriate policy steps towards decarbonisation. This is very important, since we need to ensure that the cost of the transition to renewable energy sources is not placed disproportionately and unfairly on low income groups. Although many UK households are reportedly willing to accept some increase in their bills to help finance the future energy transition, this will not be possible for all households – particularly those with little slack in their existing household budgets, or who do not own their own home.
Ofgem and BEIS should adopt an inclusive design approach to understanding the needs of all consumers (particularly those on low incomes) and use this approach to help set their priorities, develop and implement interventions, and assess their effectiveness. This means doing things differently, and engaging with low income people directly – placing them at the heart of decisions.
To help with this, Fair By Design, along with our partners Money Advice Trust, has published a practical guide on what inclusive design means and how it can be incorporated into the work of regulators.
The future of price protections
An inclusive design approach to policymaking will help identify where the limits are for the market serving certain groups of consumers, and for whom additional protections – such as price caps and targeted “social” tariffs – are needed.
In a Fair By Design study of low income households accessing Turn2us’ services, researchers compared the costs of the energy poverty premium in 2016 and 2019 to assess the degree to which the retail energy market has changed. [2] While their findings showed the positive impact of regulation, low-income consumers still face excess costs for their energy.
For example, the gap between the Standard Variable Tariff and the best online-only fixed tariff had reduced from £317 in 2016, to £213 in 2019, a reduction of over £100. [3] The gap between the best pre-payment meter tariff and the best online-only fixed tariff had almost halved, dropping from £227 in 2016 to £131 in 2019.[4] This shows a strong correlation between price protections and a reduction in the poverty premium.
This is very welcome news and shows that sensible regulation and a focus on price to protect consumers is achieving good outcomes. The focus now should be on how to narrow the gap even further, to entirely remove the poverty premium, through a combination of inclusively-designed innovations and policy changes.
About Fair By Design
Fair By Design is dedicated to reshaping essential services, such as energy, credit and insurance, so they don’t cost more if you’re poor. People on low incomes and in poverty pay more for a range of products including energy, through standard variable tariffs; loans and credit cards, because of higher interest rates; and expensive insurance premiums, by living in postcodes considered higher risk. This is known as the poverty premium.
We collaborate with industry, government, and regulators to design out the poverty premium. Our Venture Fund provides capital to help grow new and scalable ventures that are innovating to make markets fairer. The Barrow Cadbury Trust runs our advocacy work, and Ascension manages the Venture Fund.
To download the Fair By Design and the money Advice Trust guides on inclusive design visit: https://fairbydesign.com/inclusive-design/ There is one for regulators (and social policy makers) as well as one for firms.
Notes
- [1] Scarcity: The True Cost of Not Having Enough, Sendhil Mullainathan & Eldar Shafir (2011)
- [2] Although average figures of the poverty premium are not comparable across the two studies, due to differences in methodology, the calculation of the premiums remained the same and so costs are comparable.
- [3] Drawn from the average across Big 6 suppliers and across household size.
- [4] Drawn from the average across Big 6 suppliers and across household size.