A Cost of Living Scandal

 

This month our Project Lead, Maeve Cohen talks about why the decade long attack on public services is driving the cost of living crisis, and why it's more important than ever to fight for a Social Guarantee.

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The biggest hit to disposable incomes since records began in 1950 is forecast by the Office of Budget Responsibility. Yet the Chancellor’s Spring Statement failed to protect those on low and middle incomes from the rising cost of essentials. Many have decried the lack of financial support for households. However, cash incomes are only part of the story. Far too little attention is paid to the continued impact on living standards of chronically underfunded public services.

 

People have a right to the basics they need to live a fulfilling life. These basics include: a warm and secure home, nourishing food, education, people to look after us when we can’t look after ourselves, healthcare when we are ill, water and electricity, transport to take us where we need to go, access to the internet and a safe environment.

 

Most of these basics can be delivered in the form of publicly provided services (or ‘in kind’ benefits) – and the value of these benefits is huge. To put it simply, you wouldn’t be so poor if your rent wasn’t so high. You’d be much better off if childcare costs weren’t so extortionate. If there were a sufficient and affordable public transport system, you wouldn’t have to spend thousands of pounds a year on fuel and car maintenance. The impact of collectively provided services on household spending power is highly significant. After more than a decade of public spending cuts that have decimated public services, no wonder people are suffering on such a scale.

 

Analysis by the New Economics Foundation found that over 34% of the population, 23.5 million people, will fall short of the independently calculated Minimum Income Standard (MIS). But meeting this MIS is not just a case of people having enough money. It’s about people having access to the things they fundamentally need to be able to live a good life. Most of these essentials are extremely expensive – think of health care, education, transport networks, communication networks, social care, housing. To create a system in which everyone has access to what they need, we must to pool our resources and provide them collectively. This is what we should be fighting for. By focusing on cash alone, we are missing the bigger picture.

 

These services should be available to everyone – free at the point of use, or at genuinely affordable prices. We already know this; it is the principle at the core of our NHS and our public education system. This is a battle we have already won on some important fronts. And it is a battle that we clearly need to be fighting still.

 

We aim far too low if all we can say in response to the cost of living crisis is that we must increase cash incomes. Cash is just one piece of the jigsaw. The value in-kind benefits in the form of collectively provided services is absolutely crucial.

What have we been doing at the Social Guarantee? 

 

Blogs

 

This month we have been looking at the role of services in the cost of living crisis. 

 

Rachel Statham, Associate Director for Work and Welfare State at IPPR, formally Senior Research Fellow at IPPR Scotland writes about her new research looking at what universal basic services are and what role can they play in Scotland to help reduce costs households face, particularly during the ongoing cost-of-living-crisis. Read her blog here.

 

Maeve Cohen, Project Lead at the Social Guarantee writes that austerity isn't over and asks why have we stopped talking about it? It is essential that we recognise the impact of public services on household incomes, and that we continue to fight for universal services as well as a living income. Read her blog here.

 

Events 

 

Andrew Percy, Co-Chair of the Social Prosperity Network at Institute for Global Prosperity and Maeve Cohen spoke to London's Young Fabians about Universal Basic Services and how they can transform the economy by meeting our social and environmental needs. You can watch the discussion here.  

 

What we're reading

 

IPPR Scotland's report 'Universal basic services: Building financial security in Scotland' identifies the largest costs facing families below a living income, sets out the current policy approach for each of these areas, and discusses the potential for a universal basic services approach across new areas to bring more people closer to a living income. These include care, transport, information, food and utilities. Read the report here.

 

Michael Marmot, Director of the UCL Institute of Health Equity writes about health inequalities in the Guardian, and the importance of public services: "If public transport were free at the point of use, if social housing were available and affordable, home heating affordable, nutritious food available without a cost premium, then relative lack of individual income would be less harmful for health". Read the full article here.

 

Jennifer Williams, Northern Correspondent at the Financial Times writes about the impact of deregulation on bus services outside of London. The decline of good quality, affordable services has led to a massive drop in usage and a huge increase in expensive, carbon-intensive car ownership. However, local councils across the country are fighting to bring these services back under their control. You can read her reporting here. 

 

 

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