New Economics Foundation

NEF's chief economist, Dr Lydia Prieg, responds to the Chancellor's pre-budget speech.

Interesting debate going around today about the rumoured cut to VAT on energy bills. It's said it'll save the average household £86 per year. I struggle to see many households noticing a difference of £7 per month, so I suspect this policy is more one for the narrative battle. But is it the right policy to shift the narrative? Cutting VAT will save the most money for the wealthiest households - who consume the most energy. Many have sought to downplay the inequity in energy consumption. And it's fair to say the 25% gap between top and bottom deciles (figure below) isn't as big as it is in some other domains. But there is a gap. What's often missed, is what that gap will look like in 5 years. The explosive growth in the purchase of new electric vehicles is driven overwhelmingly by the UK's wealthiest households, and its rapidly driving up their domestic energy consumption (where electricity subs for petrol). A cut to VAT on energy bills will look an even less 'equal' (fair) policy in 2030 than it does now because the rich-poor divide in energy consumption will be a LOT bigger. At NEF we've long argued that we should be cutting the price of *essential* energy. We favour an initial block of cheap energy that every household receives. But another way to do it could be to cut the standing charge (or take green levies off the standing charge). So yes, while I'm along way away from Tim Leunig on airport expansion, I think we agree on this policy 😅 Link: https://lnkd.in/etx4Vigm

We live in a world with too much of what we don’t need - and too little of what we do. That’s the argument at the heart of Radical Abundance: How to Win a Green Democratic Economy by Keir Milburn, Kai Heron, and Bertie Russell. This week, Keir Milburn, co-author of Radical Abundance and co-director of action-research organisation, Abundance, joined the New Economics Podcast to discuss privatisation, public-common partnerships, and how we can democratise the economy to support a just ecological transition for everyone. 🎧 https://lnkd.in/e2h44D3w

🎉Another exciting episode of the New Economics Podcast out now! This week Ayeisha Thomas-Smith were joined by Keir Milburn and Frances Northrop to talk about the failure of privatisation, what radical abundance means, and how communities are building alternatives to capitalism. Listen on Apple podcasts, Spotify, or Soundcloud here: https://lnkd.in/e2h44D3w

Great to see that following K Chaitanya Kumar's oral evidence session in June, the Treasury Select Committee has endorsed our recommendation for the Treasury to explore the merits of allowing the NWF to borrow funds directly from the market. --> https://lnkd.in/e3z2EYg8 Not only would this enhance the NWF's independence from the Treasury when funding projects, but will grant it more space to grow in scale & ambition and have serious impact - it is currently miniscule relative to international comparators: --> https://lnkd.in/ejadjpGw As Theo Harris set out last year - the NWF could raise £100bn by issuing its own bonds: --> https://lnkd.in/e2GrNtjJ The NWF has the potential to deliver huge benefits for the UK economy, it's time for a step change in ambition!

Great to see our research on frequent flyers being discussed in the House of Lords! It's this tiny percentage of the population who will benefit the most from airport expansion, while the rest of us have to live with the environmental consequences.

The Environmental Audit Committee report on airport expansion out today opens with this: "Whilst the Government support for airport expansion has been largely based on its expectation of economic growth, the Government has been unable to direct the Committee to any evidence that supports its assertion." As I've said before... vibes based policy making. https://lnkd.in/ezY8GRuA

"Militaries have to be understood...as climate threats", accounting for more emissions than shipping and aviation combined. Khem Rogaly from Common Wealth Think Tank joined Ayeisha Thomas-Smith on the latest episode of New Economics Podcast to discuss how the UK became a global arms dealer. 🎧 Listen, like and subscribe: https://lnkd.in/dMeZQ52U