Non-religious are hardline, easygoing or spiritual, says UK thinktank

Theos study comes as new census data expected to show increase in those describing themselves as non-religious

The state funeral for Queen Elizabeth II took place at Westminster Abbey

 at a time when increasing numbers of people are describing themselves as non-religious. 

Photograph: Reuters

Harriet Sherwood

THE GUARDIAN
@harrietsherwood

Fri 23 Sep 2022 

People who are not religious tend to fall into three groups: hardline, easygoing, and those who are spiritual while rejecting organised faith, according to a study.

Its findings come ahead of new census data on religious identity due this autumn, which is expected to show a further jump in the proportion of the population that describe themselves as non-religious.

Census results for Northern Ireland published this week showed an 80% increase in the number of people identifying as non-religious – a growth in the share of the population from 10% to 17%.

Data from the England and Wales 2021 census, due before the end of the year, are expected to see the proportion of non-religious people rising to more than a third of the population. In the 2001 census, the first time a question on religion was asked, 15% of people ticked the box for non-religion; in 2011, it was 24%.

But opinion polls suggest an even higher proportion of people are non-religious. The 2018 British Social Attitudes survey found 53% of respondents described themselves as non-religious. A survey of more than 5,000 people commissioned earlier this year by the Christian thinktank Theos produced the same figure.

In a forthcoming report, The Religion of ‘Nones’, Theos has examined the attitudes of non-religious people (termed “nones”, as in “none of the above” when questioned about religious identity).

It found that only about half (51%) of those who identify as non-religious said they do not believe in God, and a fifth (20%) said they definitely or probably believe in life after death. Almost one in six (17%) believe in the power of prayer.

There were three, broadly equal-sized clusters among the nones. “Campaigning nones” are hostile to religion, said Nick Spencer, senior fellow at Theos, who co-authored the report with Hannah Waite. “Their none-ness is part of their identity. Religion isn’t something you simply don’t belong to, it’s something you campaign against.”

The second sub-group, “spiritual nones”, were less atheistic and more spiritually open, said Spencer. “They’re saying: ‘I don’t belong to a religion, but I believe stuff and often I do stuff that’s indistinguishable from the kind of stuff that religious people do. It’s just that I don’t want to wear that particular label, I don’t want to belong to a particular institution.’ It’s a more bespoke form of spirituality.”

The third cluster, “tolerant nones”, were generally atheistic, but more accepting of religion than the first group. “They don’t see religion as evil, they’re a bit more live and let live,” said Spencer.

These were people who, on watching the Queen’s funeral earlier this week, “might have thought: ‘I don’t believe in this, but I do see the merit of marking great moments of state or indeed life with ceremony’.”

According to Theos’s research, women were more likely to be spiritual nones than men, and men were more likely to be campaigning nones than women. There was no marked gender imbalance among tolerant nones, but the age profile of this group was younger than other clusters.

The discrepancy between the percentage of people defining themselves as non-religious in Theos’s research and the expected census results could be attributed to a “pearly gates syndrome”, said Spencer.

“There’s a finality to the census that you don’t quite get with opinion polls – you can change your opinion, whereas the census is the census. When push comes to shove, people may be more inclined to have a religious identity.”

Linda Woodhead, head of the department of theology and religious studies at King’s College London, said this year’s census results would continue the trend of more people identifying as non-religious and fewer identifying as Christian.

“The churches have failed dramatically as moral authorities, with the abuse scandals being just the latest nail in that coffin,” she said in a lecture on the future of religion in Britain, organised by the Religion Media Centre.

“There is currently a free for all in the area of values leadership … The Queen did an excellent job of becoming a values leader of much greater stature than any Christian leader in the country.”

The Scottish census was conducted earlier this year, with data expected to be published in 2023.

Strike action to wipe out most train services across Great Britain on 1 October

Network Rail advises passengers not to travel as a third rail union confirmed it would join the strike

Any breakthrough in talks to head off the most intense disruption to date appears less likely after Friday’s mini-budget. 

Photograph: Andy Rain/EPA


Gwyn Topham 

Transport correspondent

THE GUARDIAN
Fri 23 Sep 2022 

Network Rail has advised passengers not to attempt to travel next Saturday when coordinated industrial action will wipe out most train services across Great Britain, as a third rail union confirmed it would join the strike.

Train drivers in Aslef and signallers and crew in the RMT union will walk out for 24 hours on 1 October at the start of the Conservative conference. They will be joined by members of the TSSA at Network Rail and 11 train operating companies. Some Network Rail power-supply staff in Unite will also strike.

Only about 11% of services will run on 1 October, Network Rail said, with back-up staff running a skeleton service when the RMT and Aslef membership strike on the same day for the first time.

The rail industry said passengers should also only travel if absolutely necessary on 5 and 8 October, when first Aslef and then the RMT will stage further strikes in the bitter dispute over pay and changes to working.

Some early morning disruption is predicted on the days after each strike.

Network Rail’s chief executive, Andrew Haines, said: “Our efforts to avert this disruption have unfortunately been in vain, so we’re asking passengers to only travel if absolutely necessary on strike days. Those who must travel should expect disruption and make sure they check when their last train will depart.”

Any breakthrough in talks to head off the most intense disruption to date appears less likely after Kwasi Kwarteng’s mini-budget on Friday. The government pledged to introduce minimum service levels during transport strikes, binding rail unions to ensure trains continue to run and nullifying their effectiveness. The RMT said the moves would enrage members.

The Rail Delivery Group said the strikes were “unnecessary and damaging” and would hit significant events including the London Marathon.

Passengers affected can use any pre-booked tickets on alternative days, change their tickets or get a refund, the RDG said.

A further RMT strike on ScotRail on 10 October will cause significant disruption to trains on the last day of the SNP’s annual conference in Aberdeen.

UK

Rail unions say government plans to limit strikes will ‘enrage’ members


Kwasi Kwarteng announces moves that oblige unions to ensure trains run before sustained industrial action

Mick Lynch of the RMT union said the government should be negotiating a settlement rather than making it harder to strike

Photograph: Henry Nicholls/Reuters


Gwyn Topham

Transport correspondent

THE GUARDIAN
@GwynTopham

Fri 23 Sep 2022 14.32 BST

Rail unions have said plans announced by the chancellor to limit the scope of strikes and pay negotiations will further “enrage” their members, before a period of sustained industrial action.

On Friday, Kwasi Kwarteng announced moves not only to ensure minimum service levels during transport strikes, obliging unions to ensure trains run, but also to legislate to require unions to put any pay offers from employers to a vote.

With strikes expected to halt most train services at the start of the Conservative conference at the beginning of October, the chancellor told the Commons that the disruption caused was unacceptable.

He said other European countries had minimum service levels to stop “militant trade unions”, and the UK government would do the same, “and go further”.

Kwarteng said: “We will legislate to require unions to put pay offers to a member vote to ensure strikes can only be called once negotiations have genuinely broken down.”

Mick Lynch, the general secretary of the RMT union, said: “We already have the most severe anti-democratic trade union laws in western Europe and this latest threat will rightly enrage our members.

“The government should be working towards a negotiated settlement in the national rail dispute, not seeking to make it even harder to take effective strike action. Unions will not sit idly by or meekly accept any further obstacles on their members exercising the basic human right to withdraw their labour.”

Manuel Cortes, the general secretary of the TSSA union, which confirmed it would be joining the October rail strikes on Friday, said: “This new Tory proposal will serve only to elongate disputes and generate greater anger among union members. It will do precisely nothing to encourage employers to come to the negotiating table with realistic offers.”

Rail bosses have however expressed frustration that staff have not been able to vote on pay offers during negotiations.

Network Rail’s chief executive Andrew Haines – whose annual net pay on his £588,000 salary will increase by £20,000 due to another move announced by Kwarteng, to scrap the top rate of income tax – said: “Our latest offer – an 8% pay rise over two years with other benefits – is affordable from within our own budget, but the RMT refuses to allow its members to vote on it.

“The decision by unions to strike again serves only to prolong disruption for passengers, undermine the railway’s recovery from the pandemic and ensure railway staff forgo even more of their pay unnecessarily.”

Morrisons staff asked to invest thousands in their own company

Exclusive: Some employees report feeling pressed by private equity owners to contribute to an ailing business

Staff who agreed to invest in shares in Morrisons are said to have been paid a special bonus. 

Photograph: Chris Radburn/PA

Sarah Butler

THE GUARDIAN
@whatbutlersaw

Fri 23 Sep 2022 

Morrisons’ private equity owners have asked hundreds of staff – from store managers upwards – to invest thousands of pounds of their own money in the business.

More than 800 people have been asked to invest in the ailing supermarket in the past few months, with one well-placed source saying middle management level departmental heads had been asked for £10,000 while the directors of departments had been asked for £25,000 each. It is understood the minimum investmentrequired to participate was £2,000.

The source said that, while contributions were voluntary, some staff were annoyed about feeling pressed to make a cash contribution to an ailing business at a time when the cost of living was soaring.

“People are used to being paid bonuses rather than asked to invest,” the source said.

However, it is understood that those who agreed to invest in shares in Morrisons were paid a special bonus, equivalent to 60% of the amount they were asked to invest before tax, with quite a number understood to have invested more.

A spokesperson said: “The opportunity to invest in the future of Morrisons was incredibly popular throughout the business with over 800 colleagues, or more than 90% of those eligible, choosing to invest.”

One expert said it was common to ask staff to invest as part of private equity deals, with the stakes seen as an incentive to help the business grow.

While it is less usual to ask rank-and-file workers to participate, he said the wider-than-usual scope of the Morrisons scheme could be seen as a good thing, allowing more people to benefit from a potential return on their investment.

The grocer, which was bought out by the US private equity firm Clayton Dubilier & Rice (CD&R) in a deal worth about £7bn last year, last week lost its position as the UK’s fourth largest supermarket chain to German discounter Aldi.

Morrisons’ market share has been drifting as it is opening very little new space and surveys suggest its prices have become more expensive in comparison to key competitors.

Sales fell by 4.1% in the three months to 4 September, a time when all other major supermarkets except Waitrose increased sales.

One industry insider said: “The numbers look grim. [The product] doesn’t look exciting and they have missed quite a lot of opportunities.” The source said suppliers were becoming disillusioned as volume of goods sold by the retailer fell back.

Trevor Strain, the righthand man of the chief executive, David Potts, is understood to have told the business he plans to leave as he wants to seek a top job elsewhere. One source said Strain had been unwilling to commit to a further five years at the business, to see out CD&R’s investment plan, having joined Morrisons in 2009.

In April, Morrisons warned its profits were likely to take a significant hit this year as the cost of living crisis and disruption due to the war in Ukraine weigh on the grocery market.

The supermarket chain said “developments in the geopolitical environment” and “ongoing and increasing inflationary pressure” since the beginning of February were hitting consumer sentiment and spending.

The retailer also recently bought the McColl’s network of more than 1,000 convenience store outlets out of administration as it moved to protect a wholesale supply agreement to the chain. McColl’s had been suffering from financial pressures for some time before its collapse.

UK

Is fracking coming to a town near you? Here’s how you can fight them – and win

Tina Rothery

In my group, Nanas Against Fracking, we know community organising is not easy. But we are a force to be reckoned with

‘We lobbied our local MPs, held public meetings and 

spread our message in the media.’ Tina Rothery, centre front,

 of Nanas Against Fracking. 

Photograph: Jasper Clarke/Observer

Fri 23 Sep 2022

Hysterical “luddites” funded by Russia was how Jacob Rees-Mogg, in parliament yesterday, described concerned residents opposed to fracking in England. What a slap in the face for those of us who have spent more than a decade trying to protect our communities from the dangerous, polluting shale gas industry. We have never received so much as a rouble or a vodka shot for our efforts.

Here in Lancashire, we actually believed we had won this fight – twice. Our first victory was in 2015, when Lancashire county council rejected planning applications from the fracking firm Cuadrilla for two large sites between Preston and Blackpool. This decision was overruled by Westminster in 2016, and work began in 2017 to transform the Preston New Road site from a field where cows graze into a shale gas site. Nanas Against Fracking, a group I co-founded, started protesting at the site that day too, and continued for more than 1,000 days.

Our second short-lived victory came in November 2019, when the government had to halt fracking and put a moratorium in place, because the work had set off an earthquake measuring 2.9 on the Richter scale. Even if it is possible to ““monitor” earthquakes, which are one of the most immediately dangerous risks of fracking, the government had to face the fact that you can’t control them. The moratorium brought some relief to local residents and campaigners; although, of course, we wanted an outright ban put in place in order to finally draw a line under this and feel at ease again.

The government’s decision to lift the moratorium yesterday sent shockwaves through our community. As an anti-fracking Nana, I know how much time and energy it takes to confront a heavily financed industry, while the government acts as its cheerleaders and police are used as security on fracking sites. My fellow Nanas Against Fracking feel angry and confused, as though we have been here before. In addition to earthquakes, we are racked with other worries, such as whether home insurance premiums will increase, as they have done for people living in areas near shale gas fracking sites in the US. Will we, like some of them, see higher incidences of childhood leukaemia? What about the issues with maternal health – for example, an increased rate of stillbirths, for which there is some evidence in Utah? What will be the impacts of the waste and methane released by fracking? Has the value of our properties already dropped?

Witnessing this gross failure of democracy can feel hopeless. I remember an older man in Balcombe in 2013 looking out of the window of a teashop in the village as it became populated with protesters. He said he had believed that working, paying his taxes, never breaking the law, raising his family, and owning his home meant that he was part of a democratic society, that he could call on the government if he felt at risk. But his MP – Francis Maude, who appointed Lord Browne, the chairman of Cuadrilla, as the government’s senior business adviser – did little to help. Seeing our protest, the man said he was relieved. He had been worried about what fracking would do to the health and wellbeing of people living in Balcombe, and that we were the only ones who heeded his call.

So, if you want to resist fracking in your town, community organising is the place to start. At its height, the anti-fracking movement in the UK was made up of 300 autonomous groups across the country. As well as physically protesting, we lobbied our local MPs, informed councillors, held public meetings, objected to planning, researched and networked, and spread our message in the media. We made sure there was a role for everyone in this movement, regardless of their age, ability, background or location.

There is a place for nonviolent direct action too. It helps to infuse activism with joy. If you want to undertake a 1,000-day protest like ours, you have to come up with ways to motivate each other – such as acknowledging wins to be had before the primary goal is reached. We watched the share prices of the Australian firm AJ Lucas (Cuadrilla’s parent company), and celebrated when they fell after delays and bad press brought about by our activities at its site. We rejoiced in every new face who joined the movement (and those people who returned again and became familiar faces). We danced, sang and shared food.

The hardest thing about activism is stepping into it. Who would sanely choose to live in opposition to a more powerful force? To knowingly arrive each day accepting that arrest, violence and abuse are a certainty? We used to give public talks to communities at risk of fracking, and I called the talk The Unwelcome Gift of Truth. I hated informing residents of what was to come, because I knew the vast majority would find it impossible to ignore the risks their families would face; that they too would fall through the door marked “activism”, and maybe, like me, be unable to find the exit. How do you “unknow” the facts? How can anyone simply stand aside and trust that the government or its toothless regulatory bodies will keep us safe from this industry?

Yesterday, my fellow anti-fracking Nana, Anjie Mosher, told me: “Although the government has almost removed all right to protest, I will still peacefully stand up to do whatever I can to slow down and stop this industry before irreparable damage is done.” I’ll be doing the same, and I hope you will too.

Tina Rothery is a Blackpool resident, campaigner and co-founder of Nanas Against Fracking

UK’s nuclear waste cleanup operation could cost £260bn


Cost of safely clearing waste from ageing power stations is soaring, say experts

 

Sellafield, which is storing much of the UK’s nuclear waste, 

is one of the most hazardous sites in the world.

 Photograph: Simon Grosset/Alamy

Sandra Laville 

Environment correspondent

THE GUARDIAN

Fri 23 Sep 2022 

The cost of decommissioning the UK’s 20th-century nuclear waste could rise to £260bn as the aged and degrading sites present growing challenges, according to analysis presented to an international group of experts.

As the government pursues nuclear energy with the promise of a new generation of reactors, the cost of safely cleaning up waste from previous generations of power stations is soaring.

Degrading nuclear facilities are presenting increasingly hazardous and challenging problems. Ageing equipment and electrical systems at Sellafield, which is storing much of the country’s nuclear waste and is one of the most hazardous sites in the world, are increasing the risk of fire, according to the Nuclear Decommissioning Authority. They require increasing maintenance and present growing risk. Last October a faulty light fitting started a blaze at a Sellafield facility which led to its closure for several weeks.

Analysis by Stephen Thomas, a professor of energy policy at the University of Greenwich, estimates the total bill for decommissioning the UK’s nuclear waste mountain will grow to £260bn.

Thomas told a conference of international experts the cost of decommissioning Sellafield had risen from to £110bn, according to freedom of information requests.

Other sites that need decommissioning are the 11 Magnox power stations, built between the 1950s and 1970s, including Dungeness A in Kent, Hinkley Point A in Somerset and Trawsfynydd in north Wales, and seven advanced gas-cooled reactors built in the 1990s, including Dungeness B, which closed last year, Hinkley Point B and Heysham 1 and 2 in Lancashire.

Deterioration of one of the Magnox stations, Trawsfynydd, which shut down in 1991, is such that substantial work is needed to make it safe, according to the NDA. “Work that would then need to be undone to complete reactor dismantling,” the agency said.

Thomas told the International Nuclear Risk Assessment Group similar problems are expected at other Magnox sites. The timetable for decommissioning the old nuclear power stations has been abandoned, with no new timescale yet published.

The Nuclear Waste Service has said deferring decommissioning for 85 years from shutdown, which was previous policy, is not suitable for all the reactors because of their different ages and physical conditions. Decommissioning of some Magnox stations will have to be brought forward, the NWS has said.

Attempts to speed up the decommissioning would only add to the growing bill, Thomas said, which he estimated had increased to £34bn.

In 2005, the cost for decommissioning and disposing of the radioactive waste from nuclear power stations built in the 1950s, 70s and 90s was put at £51bn.

Last year the NDA estimates rose to £131bn, and its latest annual report said £149bn was needed to pay for the clear up. But Thomas said rising costs meant the total bill was on track to reach £260bn.

Part of the soaring increase is the cost of building a large underground nuclear waste dump or geological deposit facility (GDF) to safely store the 700,000 cubic metres of radioactive waste – roughly the volume of 6,000 double decker buses – from the country’s past nuclear programme.

The mammoth engineering project was initially predicted to cost £11bn but the bill is now estimated to be up to £53bn because of uncertainty about where the site will be located, and the need to provide space for an unspecified amount of waste from the new generation of nuclear reactors which the government wants to build.

Four areas of the country are being considered for the GDF but no decision on where it will be located has yet been made.

“While we are clear about the current legacy of waste which already exists, a GDF would have to handle additional waste from new facilities being developed,” the NWService said. “The actual cost will … depend on the number of new nuclear projects that the UK develops in future and any additional waste from those stations.”

The cleanup of past nuclear waste will take more than 100 years, the NDA has said. Highlighting the challenges of the degrading and hazardous facilities, the authority said in its annual report that robots and drones were increasingly being used to carry out site inspections.

Scottish and Welsh leaders say tax cuts for rich are ‘moral bankruptcy’

Nicola Sturgeon and Mark Drakeford criticise UK government over mini-budget that ‘embeds unfairness’

Nicola Sturgeon’s government is likely to retain a higher 

top tax rate in next year’s budget.

 Photograph: Jane Barlow/PA Media

Severin Carrell 

Scotland editor

THE GUARDIAN
@severincarrell

Fri 23 Sep 2022 

The Scottish and Welsh governments have heavily criticised Kwasi Kwarteng’s tax cuts for the wealthy, opening up a deep gulf over taxation policies in different parts of the UK.

Nicola Sturgeon, Scotland’s first minister, described the UK chancellor’s decision on Friday to abolish the 45p top rate of income tax as “moral bankruptcy”, by helping the wealthiest, hammering the pound’s value and increasing public borrowing.

Mark Drakeford, her Welsh counterpart, said the changes “embed unfairness across the UK” by failing to give meaningful help to the very poorest. “Instead, they’re giving tax cuts to the rich, bonuses to bankers and protecting the eye-watering profits of energy companies,” he said.

Kwarteng’s corporation tax changes, dropping the planned rise to national insurance rates, the alcohol duty freeze and VAT-free shopping for international travellers will apply across the UK.

But under a series of reforms to the UK’s tax systems, the Welsh and Scottish governments set their own income tax rates, and also have independent property sales tax policies not affected by Kwarteng’s stamp duty changes.

Scotland, which is able to set income tax rates and bands, already has a higher top rate of tax for those earning more than £150,000, at 46p and, until Kwarteng’s changes come into force next year, a slightly lower tax burden on the lowest paid than in England and a slightly higher one for middle earners.

Sturgeon’s government is very likely to retain a higher top rate next year, underlining its centre-left credentials.

John Swinney, Scotland’s acting finance secretary, said: “The chancellor’s statement today will provide cold comfort to the millions of people across Scotland who have been looking for the UK government to use their reserved powers to provide support for those that need it most. Instead, we get tax cuts for the rich and nothing for those who need it most.”

Wales has to use the Treasury’s income tax rates and bands, but can change each band by up to 10p. That means the 45p top rate will also be scrapped in Wales, benefiting around 6,000 taxpayers and increasing the prospect that the Labour-led government may soon campaign for the same tax powers as Scotland.

Rebecca Evans, the Welsh finance minister, said: “Today’s announcements show the UK government is heading in a deeply worrying direction.”
Under the financial fairness rules agreed by the Treasury when tax powers were devolved, Scotland will receive about £600m and Wales about £70m in additional funding from the Treasury next year, because of Kwarteng’s announcement.

Both governments are likely to match the UK chancellor’s new income tax starter rate of £14,732 – which already matches one of Scotland’s intermediate bands. And they will face pressure to increase the threshold for property sales tax to £250,000, as well as discuss Kwarteng’s regional investment zones, where tax breaks will be offered.

Philip Whyte, the director of the centre-left thinktank IPPR Scotland, said the extra £600m in Treasury funding gave Scotland “a clear opportunity to strike a different course. It can do this by funding collective services and social security to protect those families most exposed to the cost crisis.”

The Chartered Institute of Taxation said that if Scotland’s income tax rates are not changed in the Scottish budget next year, someone earning £27,850 a year would pay £152.80 more in Scotland, while those earning £200,000 would pay £6,045.80 more.

The accountancy firm PwC said that since Scotland’s top-rate taxpayers produced 16% of overall income tax receipts, Kwarteng’s abolition of it would give Swinney “food for thought as [he] considers ways to remain competitive in terms of attracting those individuals to Scotland”.

UK

This ‘mini-budget’ is a naked exercise in redistributing wealth upwards


Instead of investing to actually grow the economy, Truss and Kwarteng are borrowing big to fund tax cuts for the rich

Kwasi Kwarteng leaves 11 Downing Street to deliver his mini-budget. 

Photograph: Aaron Chown/PA

Michael Jacobs

THE GUARDIAN
Fri 23 Sep 2022 

When is a budget not a budget? When the government does not want there to be any informed analysis of its economic impacts. The only reason the Treasury has insisted Kwasi Kwarteng’s statement was a “fiscal event” and not a budget – despite a range of measures far exceeding the contents of most budgets – is that, since George Osborne’s tenure, chancellors of the exchequer have been required by law to ask the Office for Budget Responsibility (OBR) to conduct an independent analysis of the measures taken.

And why has the government been so keen to avoid such scrutiny? Because the economic impacts are likely to look very ugly. It is more or less impossible to find an economist who supports the government’s approach, or an economic model able to justify it. Indeed, the financial markets have already given their negative verdict.

The problem is not the prime minister’s ambition to “grow the economy”. Many economists would actually agree with Liz Truss’s attack on “Treasury orthodoxy”, which has focused far too much on reducing public borrowing and debt, and not nearly enough on raising investment and productivity. The UK’s poor economic performance over the past decade has much to do with the tight fiscal policies pursued by Conservative chancellors.

But there are three big problems with the way Truss and Kwarteng are seeking to reverse these policies. First, the government’s attempt to stimulate the economy through income tax cuts is deeply inefficient. As the UK slides into recession, with businesses failing and unemployment rising, it is not unreasonable for the government to inject some demand into the economy to counteract those effects. But income tax cuts are a really poor way of doing this.

This is not simply about their distributional effect. As the Resolution Foundation has shown, by reversing the national insurance hike and abolishing the 45p tax rate on incomes above £150,000, Kwarteng has performed a remarkable act of redistribution to the rich. But the wider economic problem is that much of the tax cut will not lead to higher spending. Give households more money and they will spend some of it, but also save some. And the higher their income bracket, the more they will save.


A much better way of getting money into the economy is through investment. Wise investment – in infrastructure and business – will raise productivity, and therefore increase long-term economic growth. Investment creates jobs, and therefore raises wages and spending. Economists call the rate at which an injection of cash into the economy raises national income the “multiplier”. As the OBR has noted, the investment multiplier is around three times larger than the tax multiplier. Today the best form of stimulus is green investment, in areas such as home insulation and renewable energy, which would also help to reduce fossil fuel demand and meet the UK’s climate goals. (This is Labour’s plan, it might be noted.)

Second, cutting corporation tax (or not raising it as planned) and cutting stamp duty are really not good ways of stimulating economic growth either. There is almost no evidence that lower corporation tax stimulates investment. At 19%, the UK’s corporation tax is already the lowest in the G7, yet UK business investment is also the lowest. (Germany’s corporation tax rate is 30%.) Meanwhile, cutting stamp duty without building any more houses simply raises house prices – which are already growing at their fastest rate for 20 years. This will price more people out of the housing market, and benefit only existing homeowners.

Third, the fact that the government is using borrowing to pay for all these tax cuts makes them an even worse idea. At a time when the chancellor is tearing up his own government’s fiscal rules, it is worth noting that the one fiscal rule almost everyone accepts is the so-called “golden rule”: that, in normal times, governments should borrow only to invest. This is because investment generates growth, which helps repay the borrowing. Almost no economist would agree with borrowing to fund tax cuts. (This is not what Margaret Thatcher did: she only cut tax when there had been sufficient growth to fund it.)

In fact, the government’s fiscal strategy is even more extraordinary than this. The tax cuts announced will cost about £27bn next year, net of the oil and gas windfall tax already announced. The energy bills subsidy schemes for households and business will cost £60bn. Not yet announced, but very likely in the coming full budget, are spending increases: perhaps £18bn to maintain the real value of public service spending given inflation, and perhaps £25bn to raise defence spending from 2% to 3% of GDP. In total, it seems likely that the government will be borrowing up to £130bn more in 2023-24. Last year, the government borrowed £169bn (a historically high figure; before the pandemic it was about £50bn). So that is a remarkable 75% increase in borrowing.

Can the government borrow this much? Certainly. But only at a price. That price can already be seen in the yields purchasers of government bonds (“gilts”) are now demanding. Already today, UK bond yields are up sharply, having already been rising for the past couple of weeks since the new government took office. Coupled with the interest rate rise announced by the Bank of England on Thursday (with more almost certainly still to come), that makes the government’s borrowing more expensive, creating an even bigger deficit.

And that’s not the only reaction of the financial markets. Over the past two weeks the pound has fallen to its lowest level against the dollar for 20 years, and it is also down against the euro. It fell again after the chancellor’s speech. The markets are signalling their anxieties about the government’s strategy and its impact on the economy. Why does this matter? Because a lower pound raises import prices, thereby pushing inflation up. And it also makes gas (which is priced in dollars) more expensive, thereby raising the cost of the government’s energy bills scheme even higher.

This is a potent brew of economic reaction. There is open talk now of a possible run on the pound, and gilt yields rising even further. A former member of the Bank of England monetary policy committee said this week that if he were an investor he would short (bet against) the pound. If their radical fiscal plan goes wrong, Truss and Kwarteng might find themselves shorted in the political markets.

Michael Jacobs is professor of political economy at the University of Sheffield

Analysis

History suggests Kwarteng’s gargantuan economic gamble won’t end well

The belief that low taxes and light-touch regulation are good for everyone is about to be tested to the limits

Kwasi Kwarteng leaves 11 Downing Street in London before 

delivering his mini-budget statement in the House of Commons. 

Photograph: Kirsty Wigglesworth/AP


Larry Elliott

THE GUARDIAN
Fri 23 Sep 2022 

A struggling economy. An unpopular Conservative government. A dramatic change of course. Britain has been here before. Just like Reginald Maudling in the early 1960s and Tony Barber in the early 1970s, Kwasi Kwarteng has gone for broke, with a massive package of tax cuts designed to put Britain on a higher growth path.

The chancellor will be crossing his fingers that his experiment has a happier ending than those of his predecessors, neither of which ended well. It is one huge gamble on supply-side reforms boosting enterprise, tax cuts paying for themselves, and the financial markets remaining onside. The initial reaction from the City was far from reassuring.

As was only too predictable, sterling took a thumping on the currency markets. City currency traders might well be among the big beneficiaries of Kwarteng’s tax cuts but that didn’t stop them selling the pound down through the $1.10 level against the US dollar. Parity against the US currency is not that far away.

No question, this was a big package, a full-scale budget in all but name. Kwarteng delivered on all the tax pledges made by Liz Truss during her leadership bid – and more. The 45% rate of income tax for the highest earners has been scrapped; a reduction in the basic rate from 20% to 19% pencilled in by the former chancellor Rishi Sunak for 2024 has been brought forward by a year.

Put together with the removal of the increase in national insurance contributions and the decision not to go ahead with next April’s increase in corporation tax and you get a £45bn giveaway, not quite as big as Barber’s in 1972 but hefty by historical standards.

As the Institute for Fiscal Studies pointed out, this was a deeply regressive mini-budget, with the biggest percentage gains going to the top 1% of earners. The much more modest help for those on the lowest incomes will be wiped out by the higher cost of imported fuel and food caused by a weaker pound.

Kwarteng’s insistence that the government was committed to fiscal responsibility was greeted with derision from Labour MPs, particularly given the lack of independent scrutiny of the chancellor’s arithmetic from the Office for Budget Responsibility. Such an exercise might have questioned the newfound belief in the Treasury that new investment zones, slashing red tape, tougher welfare rules and an end to the bankers’ bonus cap will raise the trend rate of growth to 2.5%.

In effect, the mini-budget was a triumph for free-market thinktanks, such as the Institute for Economic Affairs and the Adam Smith Institute, which are true believers in the idea that low-tax, light-touch regulation, small-state economies are not just good for the rich but good for everyone.

That conviction is going to be tested to the limits in the months ahead. Britain has inflation at close to 10% and to the extent it boosts demand, the mini-budget will add to inflationary pressure. It will do nothing to discourage the Bank of England from continuing to raise interest rates and if borrowing costs go as high as the markets are predicting the sugar rush will be short-lived.

What’s more, the main beneficiaries of the package will be the better off; the politics of the package depend heavily on less well-off voters being convinced of the theory of trickle-down economics. They might take some persuading.

But the biggest immediate threat to the chancellor comes from a crashing pound and soaring bond yields. No chancellor can avoid the scrutiny of the financial markets, which is why Kwarteng’s gamble has only two feasible outcomes: complete success or abject failure. History suggests it won’t be the former.

UK

Has Liz Truss handed power over to the extreme neoliberal thinktanks?

The prime minister is in hock to a group of rightwing lobbyists who are themselves indebted to oligarchs and corporations

‘To a greater extent than any previous leader, Liz Truss’s politics have been shaped by organisations that call themselves thinktanks, but would be better described as lobbyists who refuse to reveal who funds them.’ 

Photograph: Anadolu Agency/Getty Images

George Monbiot
Fri 23 Sep 2022 

Who chose Liz Truss? Conservative party members, of course. Who are they? Disproportionately rich, white, older men living in the south of England. But there are some members whose profile we have no means of knowing. They don’t live in the UK, have never been residents or citizens here and have no right to vote in our elections. Astonishingly, since 2018 these foreign members have been permitted to determine who the UK prime minister should be.

The Conservative party’s rules of association are an open invitation to anyone who wants to mess with our politics. There seems to be nothing to stop agents of another government from registering as members with Conservatives Abroad. Nor, it seems, is there anything to stop one person (or one botswarm) applying for multiple memberships. So much for the party of patriotism, sovereignty and national security.

This open invitation, to judge from the little information we can glean, has yet to be fully exploited. Perhaps foreign governments haven’t yet realised what a golden opportunity they’ve been given. Perhaps they simply can’t believe how irresponsible the Tories are.

But we don’t need to suggest a campaign by another state to see Truss as a kind of Manchurian Candidate, subverting what remains of our democracy on behalf of undemocratic interests. As a rule, the more loudly a politician proclaims their patriotism, the more likely they are to act on behalf of foreign money. Every recent Conservative prime minister has placed the interests of transnational capital above the interests of the nation. But, to a greater extent than any previous leader, Truss’s politics have been shaped by organisations that call themselves thinktanks, but would be better described as lobbyists who refuse to reveal who funds them. Now she has brought them into the heart of government.

Her senior special adviser, Ruth Porter, was communications director at the Institute of Economic Affairs (IEA), an extreme neoliberal lobby group. An investigation by the democracy campaign Transparify listed the IEA as “highly opaque” about its funding sources. We know from a combination of leaks and US filings that it has a history of taking money from tobacco companies and since 1967 from the oil company BP, and has also received large disbursements from foundations funded by US billionaires, some of which have been among the major sponsors of climate science denial. When she worked at the IEA, Porter calledfor reducing housing benefit and child benefit, charging patients to use the NHS, cutting overseas aid and scrapping green funds.


How the right’s radical thinktanks reshaped the Conservative party

She then became head of economic and social policy at Policy Exchange, which was also listed by Transparify as “highly opaque”. Policy Exchange is the group that (after Porter left) called for a new law against Extinction Rebellion, which became, in former home secretary Priti Patel’s hands, the Police, Crime, Sentencing and Courts Act. We later discovered it had received $30,000 from the US oil company Exxon.

Liz Truss, according to the head of the IEA, has spoken at more of its events than “any other politician over the past 12 years”. Two of Truss’s meetings with the organisation were deleted from the official record, then reinstated after the deletions caused a scandal.

More importantly, Truss was the ostensible founder, in 2011, of the free enterprise group of Conservative MPs. The group’s webpage was registered by Ruth Porter, who at the time worked for the IEA. The IEA organised events for the group and supplied it with media briefings. Twelve members of the current cabinet, including several of its most senior figures, belonged to the group. Today, if you try to open its webpage, you are redirected to the Free Market Forum, which calls itself “a project of the Institute of Economic Affairs”.

Truss’s chief economic adviser is Matthew Sinclair, formerly chief executive of a similar lobbying group, the Taxpayers’ Alliance. It is also funded obscurely by foreign donors. Sinclair wrote a book called Let Them Eat Carbon, arguing against action to prevent climate breakdown. It claimed that: “Equatorial regions might suffer, but it is entirely possible that this will be balanced out by areas like Greenland.” In other words, we can trade the lives of billions of people against the prospects of some of the least inhabited places on Earth. It’s among the most callous and ignorant statements I’ve ever seen.

Truss’s interim press secretary, Alex Wild, was research director at the same organisation. Her health adviser, Caroline Elsom, was senior researcher at the Centre for Policy Studies, which was listed by Transparify as – you guessed it – “highly opaque”. Her political secretary, Sophie Jarvis, was head of government affairs at the Adam Smith Institute (also “highly opaque”), and funded, among others, by tobacco companies and US foundations.

These groups represent the extreme fringe of neoliberalism. This maintains that human relationships are entirely transactional: we’re motivated above all by the pursuit of money, which shapes our behaviour. Yet, hilariously, when you challenge them about their funding, they deny that the money they receive influences the positions they take.

For decades, policy development on the right was shaped as follows. Oligarchs and corporations funded the thinktanks. The thinktanks proposed policies that, by sheer coincidence, suited the interests of oligarchs and corporations. The billionaire press – also owned by oligarchs – reported these policy proposals as brilliant insights by independent organisations. Conservative frontbenchers then cited the press coverage as evidence of public demand: the voice of the oligarchs was treated as the voice of the people.

In his autobiography Think Tank, Madsen Pirie, founder of the Adam Smith Institute, explained how it worked. Every Saturday, in a wine bar in Leicester Square, staff from the Adam Smith Institute and the Institute of Economic Affairs would sit down with Conservative researchers and leader writers and columnists from the Times and Telegraph to plan “strategy for the week ahead” and “co-ordinate our activities to make us more effective collectively”. The Daily Mail weighed in to help the lobbyists refine their arguments and ensure there was a supportive article on its leader page every time they published a report.

But now the thinktanks don’t need a roundabout route. They are no longer lobbying government. They are the government. Liz Truss is their candidate. To defend the interests of global capital, she will wage war against any common endeavour to improve our lives or protect the living planet. If Labour is looking for a three-word slogan with which to fight the next election, it could do worse than “Mend This Country”.

George Monbiot is a Guardian columnist

UK

Who wants Liz Truss’s bonfire of net-zero red tape? Not big business, for a start

The Tories were once the party of business. Now all they know how to do is drag Britain back to the 1980s
 

‘Cheap, secure, renewable energy looks increasingly key to big business’s 

ability to keep turning a profit.’ 

Photograph: Owen Humphreys/PA

Gaby Hinsliff

THE GUARDIAN
Fri 23 Sep 2022

If Liz Truss believes wholeheartedly in one thing, it’s that nobody likes being told what to do. People don’t want to be nagged about their weight, or nudged to eat less and move more. They don’t want to be told what they can say on social media. And above all, businesses want to be free to make piles and piles of money, unhindered by regulation and red tape and what David Cameron famously called “green crap”. But when she said she didn’t mind making herself unpopular in the process of unleashing all that growth, she didn’t mean with the people doing the growing.

What to make, then, of the fact that this week more than 100 big corporate names from Ikea to Amazon, Coco-Cola and Sky signed an open letter urging the government not to backtrack on net zero, following hints that Truss might be considering doing exactly that? This wasn’t in the script, either for the deregulatory right or arguably that part of the left convinced that capitalism loves nothing more than warming its rapacious hands over a bonfire of crackling red tape, while watching the planet burn. What, exactly, is going on?


CEOs aren’t monsters, obviously. They see the same fires and floods and droughts on the news as everyone else, and presumably have the same teenage children berating them at breakfast. They know that being seen to go green matters both to younger customers and employees, with generation Z increasingly squeamish about working for brands their friends consider toxic.

For some, like a water industry enduring its driest summer in 30 years, the climate crisis already represents a direct threat to their operations; others, like renewable energy providers, have built their businesses around decarbonisation. But what has really changed, following the conflict in Ukraine, is that big business is now significantly more worried about rocketing fossil fuel prices. Cheap, secure, renewable energy looks increasingly key to their ability to keep turning a profit.

That said, it would be naive to imagine that big polluters aren’t already lobbying this new government to water down some net zero policies, or that plenty of companies didn’t have tweaks they’d like to make. But there is a surprisingly big swathe of business that would be rattled by a sudden change of direction now.

The letter was organised by the Cambridge Institute for Sustainability Leadership (CISL), whose recent poll of 700 senior business leaders found nearly 70% already had their own company net zero plans (some doubtless more convincing than others, but that’s another column) and 80% had earmarked funding. Telling them at this late stage that actually they needn’t have bothered spending the money seems more exasperating than liberating.

The same is true of scrapping the sugar tax now, after companies have already been through the pain barrier of reformulating snacks and fizzy drinks to avoid the tax. Sometimes red tape isn’t just about protecting the public but creating stable and predictable conditions in which to make money, plus a level playing field of obligations where well-run companies aren’t undercut by bad ones or made to feel like suckers. Almost three-quarters of respondents to the CISL poll, tellingly, said that far from being a drag, regulation mattered to their company’s business model.

True, it often shifts costs from the state on to business, which business naturally resents. But the logical, if unpopular, corollary is that scrapping it just shunts those costs back on to taxpayers, something the government seems rather less keen to discuss. As Polly Mackenzie, the former chief executive of the thinktank Demos, tweeted recently, you can scrap the rules that stop businesses fuelling things such as obesity or workplace stress or air pollution but “your health costs are going to be massive”, quite apart from the human suffering caused. Someone still has to pay: it’s just a question of who.

Mackenzie knows this territory well, having been a Liberal Democrat special adviser in the 2010 coalition government, whose own much-hyped bonfire of red tape fizzled out when it emerged that most rules actually exist for a reason, and the reason is often that people like them. One early candidate for scrapping was apparently rules governing the flammability of children’s nightwear, on the grounds that most families now have radiators not riskier open fires. But still, is anyone crying out for kids’ pyjamas that go up in flames more readily? Is that really what progress means?

Even rules that were fiercely resented at first tend to settle in over time, becoming part of the wallpaper. The working time directive, which protects employees from being forced to work more than 48 hours a week, was controversial back in 1998 when it was first introduced. But binning it – as Jacob Rees-Mogg is reportedly considering – feels curiously last century now, in a world where companies anxious to boost productivity are instead experimenting with four-day weeks.

The idea of freedom, or getting the government the hell out of your life, remains a heady one and for many leavers was part of the itch to Brexit. But if it still thrills a certain kind of Tory voter, it feels increasingly retro. We’ve come a long way from the days when greed was good, lunch for wimps and caring about the planet strictly for hippies. If you want to drag Britain back to the 1980s, don’t expect us to come quietly.

Gaby Hinsliff is a Guardian columnist