The Blog

An Immobile Society: The Price of Knowledge

The Education Policy Centre at King’s Think Tank is currently concerned with researching inequalities in the UK’s education sector, and the effects of the privatisation and marketisation of learning. It recently held a thought-provoking panel discussion on this topic, entitled The Price of Knowledge. The audience were treated to the opinions of Mr Sean Coughlan (Education Correspondent for BBC News), Dr Wanda Wyporska (Executive Director at the Equalities Trust), Professor Francis Green (Professor of Work and Education Economics at UCL), and Dr David Kynaston (historian and author of multiple books), who spoke on the issues of independent  schools, and of tuition fees for higher education. I shall comment on the discussion of both in turn.

Independent Education in the UK

What does the future look like for private schools?

In answer to our first question of the evening, the panellists identified two potential risks: the economic, and the political. Economically, private schools are businesses, and are therefore bound by the economic laws of supply and demand. Falling demand for private schooling would therefore represent a significant risk for their future. Politically, since independent schools are part of the broader education sector, they are subject to government policy. The British Department for Education could abolish private schools if it wished, or disadvantage them by, for example, removing their charitable status. However, the panellists eventually dismissed both political and economic concerns as implausible, and conceded that the future for private schools, at least in the short-to-midterm, looks favourable.

Private schools boast a secure economic position. All the panellists agreed that private schools generally provide a superior quality of education to state schools, as the resources available to private schools are much higher than their tax-payer funded counterparts (some independent boarding schools cost around £30,000 per year, per child). Furthermore, sending one’s children to private school is a safe investment in their future: Professor Green cited statistics showing that the earning potential of privately schooled students is raised by 35% (for men) and 20% (for women). These facts explain why, as Professor Green put it, there is an ‘enormous demand’ for private schooling: demand that is rising, rather than falling.  Finally, Mr Coughlan pointed out that the number foreign children attending British private schools is growing. This indicates that globalisation is favouring such schools, perhaps because they offer a world­class education and are therefore competitive on a global market.

Mr Coughlan suggested that ‘fragile economic times’ represent a risk for independent schools. But this was unconvincing, as both propositions – that the economic times are fragile, and that fragile economic times would present a serious risk to private schools – were advanced without argument. And both could well be challenged. First, it could be argued that our economy is not fragile, or at least not fragile enough to present a risk to private schools. For example, the UK’s GDP grew by 1.5% in 2017 and is predicted to grow by a similar amount in 2018. Second, it could be argued that even a very fragile economy would not put private schools at serious risk, as independent education survived the 2008 recession.

What of the political risks? Mr Coughlan claimed that ‘politically, their position is safer than it has been for many years’. The reason, he explained, is that Britain is a ‘pro-choice’ society, where parents have a right to choose how to educate their children as part of their lifestyle. Politically, therefore, there is little motivation to abolish private schools or make them illegal, as this would restrict citizens’ choice. But what of other policy options available to the government, that do not amount to abolition? For example, the government could force up the cost of independent education by removing the charitable status of private schools, or by instating VAT on the transaction. Coughlan’s comment does not address the political viability of this option, since it would not violate the right to choose how to educate one’s children.

Given that Britain is a democracy, whether the government will decide to enact a handicapping policy of this kind depends on whether private schooling is an issue of concern for the public. The panellists agreed that it is not. Dr Kynaston used the Labour party manifesto as an example: it devoted only one sentence to the issue. Professor Green further explained that this may be due to more pressing concerns, such as Brexit. Therefore, the consensus was that the level of political risk to private schools was low, at least in the short term. Dr Kynaston expressed his surprise at the ‘lack of traction’ of the issue – that is, of the lack of any serious political movement to enact anti-private school policy, but we might reply that the issue will only gain traction once we are clear on what such a policy would achieve. Remember, at stake is the degree of inequality in the UK’s education system. What kind of policy directed at private schools resolve this injustice? Would it be negative in nature? This leads us on to the follow-up-question asked of the panellists.

What can we do to reduce the achievement gap between the independent and state education?

Green categorised two kinds of policies to reduce inequality in education. The first I have already mentioned, which is to disadvantage private schools by forcing a price-hike; to ‘put a spanner in the works’ of the independent sector, in Professor Green’s words. He indicated that this may not be effective or viable. It is overtly negative, for one, and politically unattractive as a result.  Another risk of raising the cost of private education, as Dr Wyporska pointed out, is to promote segregation in the state sector. Segregation arises because a state school with a strong reputation drives demand for housing in the school’s catchment area – the geographical area from which the school’s pupils are drawn. This prices out poorer families, and Dr Wyporska explained that many of these families  are of a minority ethnic group. The best schools become the reserve of the wealthy and white, institutionalising segregation. Raising the cost of private education excludes the middle classes, who then drive demand for housing in the catchment areas of the better state schools. Thus, Professor Green proposed that we should pursue a second, more positive type of strategy – one in which we seek to integrate private schools into the state system.

Mr Coughlan warned that the government is obliged to respect the right of parents to choose how to educate their children. In response, Dr Kynaston argued that that leaves the problem of the privilege of wealth, entrenched by the inequalities in the education system, unresolved. Dr Wyporska echoed these worries when reciting statistics about the domination of privately educated people in our political systems and institutions, such as the media and the legal system. Enacted properly, however, a strategy that sought to integrate the private sector into the state sector could protect choice whilst also reducing the inequalities and entrenched privilege vexing Dr Kynaston and Dr Wyporska. Thus, by agreeing to Professor Green’s proposal, we may be able to appease all the panellists. But the question that remains: what shape would such an integrative policy take? Professor Green admitted that more work need to be done if we want to answer this question adequately.

Higher Education

How should we fund higher education?

Due to time constraints, the debate of this topic was brief. However, two important and thought-provoking points of discussion were raised.

Mr Coughlan initially argued that ‘more people go to university than ever before, which is a good thing’. Dr Wyporska countered this assumption: why it is a good thing for over 50% of our school leavers to go on to higher education, particularly given the huge over-representation of academic degrees at university level, compared to vocational study? A critical assessment of this assumption is in order, as it may be that neither the student nor the state should always be willing to pay the cost of further academic study. Furthermore, Dr Wyporska suggested that the government ought to ensure that a much greater variety of higher education is available, especially practical skills-based training. According to Dr Wyporska, there is an argument to be made that less people should study academic degrees.

If Dr Wyporska is right, we ought instead to ask why students are paying £9,000 a year for degrees that may not be worth that money. One reason is the prevalence of the assumption mentioned above, that it is good to go on to university after school, and the implication that not getting a degree is bad. I suspect that it is quite common for school-leavers to go on to university because they feel they are supposed to do so, without a proper cost-benefit analysis. But another possible reason is that school-leavers do not fully appreciate the cost, since it is not paid upfront. Thus, Coughlan argued that the student loan system should be re-packaged as a graduate tax. This is practically what it is for most graduates like myself. The cost of higher education is more apparent as being liable to a %9 income tax if we earn more than £21,000 a year, rather than as a loan which we must eventually repay. Such, at least, is the idea.

I believe that the suggestions of the panellists are pressing and deserve attention. We need to assess the value of a degree, and how its cost is presented to school-leavers. And we need to address the imbalance between academic and vocational opportunities available to students. Excellent themes, I would suggest, for the policy writers at KTT’s Education Centre to think about.

Bertram O’Brien is a postgraduate student in Philosophy at King’s College London. He previously completed a BA degree in Philosophy, Politics, and Economics at The Queen’s College, Oxford University. He is currently ambassador on Campus for JobLab.

Trump Cuts Aid to Pakistan: the Future of US-Pakistan Relations

In the ringing of the new year, President Trump released a new foreign policy statement via Twitter regarding America’s aid to Pakistan. Aid to Pakistan “no more!” as their “lies and deceit” can no longer be tolerated, typed Trump.[1] Newspapers such as The Independent headlined: “Trump’s first tweet of 2018 sparks crisis in Pakistan”.[2] Over two months later, the question remains: what lies in store for US-Pakistani relations? The arguments for and against Trump’s cut to aid need to be examined in reference to whether its aim was fulfilled, as well as its consequence for bilateral relations and on the common goal of counter-terrorism. This article will first assess the benefits and weaknesses of aid before moving on to its implications on the Pakistan-US relations. Overall, Trump’s aid cut is counterproductive, as terrorism will likely to flourish with less counter-terrorism funding. It will also further alienate Pakistan from America, prompting it to move closer to China and undermining coordinated counter-terrorism policies in the entire region.

The most common justification for cutting $255 million in security to Pakistan refers to the corruption currently rampant in the Pakistani government.[3] Many American taxpayers are reassured that their wages will no longer subsidise corruption in a foreign state.[4] According to the Trump administration, the Pakistani government has been playing a double game with terrorists and American government. Indeed, the Haqqani network are known to have an ‘ambiguous’ relationship with the Pakistani army, both of which worked with the CIA to counter the USSR’s invasion of Afghanistan in 1991.[5] The United States has often been accused of hypocrisy for aiding a government which welcomes Afghani terrorists and makes little effort to oppose its own. It is clear and unquestionable that the army needs to step up to fight against terrorism. Furthermore, Ms. Fair and Ms. Gaungly argue that even if cutting aid does not reach its objective, it will still be symbolically powerful as Pakistan will come to the terms that it cannot blindly rely on the United States for unlimited and untied funds.[6]

Nevertheless, whether cutting aid is the appropriate leverage to convince the Pakistani army government to crack down on terrorism remains an uncertain issue. alone, terrorism in Pakistan has resulted in 30,000 casualties and cost the Pakistani economy $120 billion over 15 years.[7] Furthermore, President Trump’s strategy may prove to be short-sighted: instead of mitigating regional security threats, aid cuts may instead undermined US-Pakistani relations in the long-term. The Pakistan foreign ministry has been said that “it is disappointing that the US policy statement ignores the economic sacrifices rendered by Pakistani nation in this (counter-terrorism) effort. [8] Further, Jamat-e-Islami, a marginal yet influential party, told the FT “our message has always been that you can’t trust the Americans. Now Trump has is proving it.”[9] Arguably, the key to pressurising a harder response to terrorism was to develop their relationship and form coordinated responses, in addition to helping strengthen the accountability of Pakistan’s civil institutions. Instead, Pakistan has ramped up its own pride by biting back to US through threats of cutting intelligence-sharing due to “infuriation from Trump’s hard-line rhetoric and aid suspension.”[10] Further, Pakistan’s threat to cut the land route for US troops into Afghanistan as well as the supply route for US troops through the Karachi port still looms.[11]

It wouldn’t be illogical to also ponder if this new policy made things worse. Trump’s tweet has been used as evidence to fuel anti-Western propaganda and rhetoric spread by domestic politicians such as Imran Khan, furthering hostilities between the two nations[12]. Such politicians do not hesitate to condemn Trump’s accusations as biased and inaccurate, arguing that Pakistan should not be given full responsibility for the regional growth in terrorism. The Pakistani Ambassador to the US remarked that Pakistan was not responsible for cross-border migration from Afghanistan but that better management and the “need (to) secure that border” was necessary to prevent rise of terrorism in Pakistan. It is valid to suggest that Pakistan cannot be fully responsible for the growth of terrorism as seen in the recent attacks in Afghanistan, however, Pakistan should do more with cross-border migration of terrorists in terms of investing in border control. Nevertheless, without proper funding from the US., it is hard to see how they can achieve this alone.[13] Others argue that US-Pakistani relations will stay the same, such as citing the closeness of certain Pakistani and American military-men: American General Jospeh Votel recently met with Pakistani General Qamar Javed Bajwa, and was flown to Wazristan , a significant area known for its militant activities.[14] It is hard to see Pakistan changing its domestic policy by means of sanctions.[15] Instead, all that has occurred is increased tensions between the two nations.

As a result of these tensions, American hopes to increase counter-terrorism strategies have instead backfired. America’s drone campaigns underway in Afghanistan and North-West Pakistan will be further condemned and countered by the Pakistani government even though they were previously quietly accepted in return for good US-Pakistan relations. The Pakistani Defence Minister, Dastigir-Khan, was quoted to have said “US have given us nothing but incentive and mistrust”.[16] The quote highlights the anti-American sentiment, and which underlie the unintended and unforeseen consequence of closer relations of Islamabad and Beijing. Evidently, Trump failed to appreciate the consequences of the CEPC when formulating his tweet, as the CEPC arguably reduces Pakistan’s reliance on Trump’s military aid, since Islamabad can rely on Beijing to provide the necessary funds. Some in the West have pointed that Washington could further threaten Pakistan to be removed as a “non-NATO ally” and thus have more leverage over Pakistan.[17] The benefits of adding fire to the oil haven’t been justifiable as of yet, but the consequences for increasing tensions are definitely worth monitoring.

To conclude, Trump’s cut to aid has both positive and negative consequences. American taxpayers can rejoice in the fact that their wages are no longer funnelled into a foreign state’s corrupt government. Trump surely revels in denouncing the “lies and deceit” of the Pakistani government. However, the short-sightedness of these benefits may result in detrimental consequences in the long-term, particularly regarding increased tensions between US-Pakistan, which has broader implications for the entire region’s security. Especially regarding red-hot tensions between Pakistan and India, the US must be very careful and strategic about how they interact with the Pakistani government. The US should be clear in their security objectives in Pakistan without prompting Pakistan to cosy up to China and undermine a viable counter-terrorism relationship.

Habiba Paracha is a first-year student studying International Relations at King’s College London. She is particularly interested in security issues and foreign policy in the Middle East and Asia.

Bibliography:

[1] Donald Trump’s tweet, Twitter, https://twitter.com/realDonaldTrump/status/947802588174577664?ref_src=twsrc%5Etfw&ref_url=http%3A%2F%2Fwww.bbc.co.uk%2Fnews%2Fworld-us-canada-42536209

[2] Mythili Sampathkumar, “Trump’s first tweet of 2018 sparks crisis in Pakistan as it summons US ambassador,” The Independent, http://www.independent.co.uk/news/world/americas/us-politics/trump-pakistan-us-tweet-crisis-ambassador-security-meeting-latest-a8138561.html

[3] Ibid.

[4] C. Christine Fair and Sumit Gaungly, “Pakistan and the Myth of “Too Dangerous to Fail,” Foreign Affairs, https://www.foreignaffairs.com/articles/pakistan/2018-01-08/pakistan-and-myth-too-dangerous-fail

[5] Katrina Mason, “Pakistan defends move not to take military action against Haqqani”, Financial Times, https://www.ft.com/content/aa8df0ee-fce3-11e7-9b32-d7d59aace167

[6] C. Christine Fair and Sumit Gaungly, “Pakistan and the Myth of “Too Dangerous to Fail,” Foreign Affairs, https://www.foreignaffairs.com/articles/pakistan/2018-01-08/pakistan-and-myth-too-dangerous-fail

[7] Ibid.

[8] Kiran Stacey, Farhan Bokhari and Katrina Mason, “Pakistan exasperated by wavering US policy on Afghanistan, Financial Times, https://www.ft.com/content/27651310-8726-11e7-bf50-e1c239b45787

[9] Ibid.

[10] Mason, “Pakistan defends move not to take military action against Haqqani”, Financial Times, https://www.ft.com/content/aa8df0ee-fce3-11e7-9b32-d7d59aace167

[11] Ahmed Rashid,”Pakistan struggles while Afghanistan celebrates Trump’s cuts”, Financial Times, https://www.ft.com/content/8d2c16d6-f467-11e7-88f7-5465a6ce1a00

[12] Shuja Nawaz, “Trump’s Flawed Pakistan Policy”, Foreign Affairs, https://www.foreignaffairs.com/articles/pakistan/2018-01-10/trumps-flawed-pakistan-policy

[13] Mason, “Pakistan defends move not to take military action against Haqqani”, Financial Times, https://www.ft.com/content/aa8df0ee-fce3-11e7-9b32-d7d59aace167

[14] Paul Mcleary and Dan De Luce, “Trump Administration Threatens to Cut Aid to Pakistan. Does it matter?”, Foreign Policy, http://foreignpolicy.com/2017/08/23/trump-administration-threatens-to-cut-aid-to-pakistan-does-it-matter/

[15] Mason, “Pakistan defends move not to take military action against Haqqani”, Financial Times, https://www.ft.com/content/aa8df0ee-fce3-11e7-9b32-d7d59aace167

[16] Sampathkumar, “Trump’s first tweet of 2018 sparks crisis in Pakistan as it summons US ambassador,” The Independent, http://www.independent.co.uk/news/world/americas/us-politics/trump-pakistan-us-tweet-crisis-ambassador-security-meeting-latest-a8138561.html

[17] Fair and Gaungly, “Pakistan and the Myth of “Too Dangerous to Fail””, Foreign Affairs, https://www.foreignaffairs.com/articles/pakistan/2018-01-08/pakistan-and-myth-too-dangerous-fail

 

Spare Some Change? Countering UK Homelessness

Homelessness is a pressing and complex issue, with causes ranging from financial struggles to mental health problems, including addiction. At the very visible end of this growing crisis, increasing numbers of people are facing biting-cold nights on the streets. Current data shows an increase of 15% from 2016 to 2017 in rough-sleeping, and the number of rough-sleepers in Britain has more than doubled since 2010.[1] Homelessness statistics serve as a litmus test to a society’s failure – or, more pertinently, a government’s inability – to provide a holistic tranche of viable policies that seek to care and provide for this marginalised community.

In October 2016, Theresa May shifted her cabinet’s emphasis away from tackling the ‘immediate consequences of homelessness’ towards putting ‘prevention at the heart of a new approach.’[2] Manchester’s mayor, Andy Burnham, put homelessness at the forefront of his inaugural policies launching the homelessness fund and pledge to end rough sleeping by 2020.[3] Burnham’s mayoral counterpart in London, Sadiq Khan, also aspired to ‘support people from becoming homeless and help them if they do.’ Khan plans to invest £50m into accommodation for people moving from hostels to long-term homes and £9m into rough sleeping services.[4] Tackling homelessness is an issue that clearly crosses party political divides whilst also being a party-grabbing headline winner.

Originally a private member’s bill, ‘The Homelessness Reduction Act’ was passed in April 2017 and will be implemented across England and Wales in 2018, making it the first major piece of homelessness legislation in 15 years.[5] The Housing (Wales) Act 2014 serves as inspiration for much of the new Act’s content.[6] For instance, the 2017 Act places higher expectations on local Councils in England, who will have a duty to prevent or relieve homelessness for all threatened by it, a significant change to a previous commitment to dealing solely with those identified as priority-need. Furthermore, local Councils will have to help someone threatened with homelessness if it is likely they will become homeless within 56 days, rather than the current 28, triggering prevention duty earlier and allowing more time to bring in early intervention and other agencies to respond to problems and help the applicant remain in the property. The British government has allocated an extra £61m from 2017-2019 to help councils meet the costs of this legislation. However, some local authorities are estimating that the changes may lead to a 50% increase in demand on their current services, a problem compounded by looming austerity measures and Brexit uncertainties which keep local Councils under enormous pressure. Even the Act’s emphasis on ‘reduction’ openly signals an ongoing crisis, although said Act does not propose measures to resolve said crisis so much as mitigate it.

Although a positive step, the 2017 Homelessness Reduction Act nevertheless feels incomplete: a whole series of supportive policies are necessary for its success, most particularly regarding affordable housing. Indeed, as homelessness increases, affordable housing decreases, creating a double crisis. The charity ‘Shelter’ proposes that the solution to homelessness lies in building more affordable housing.[7] A reliance on the private sector for housing needs further worsens the situation, as outlined by the Homeless Link, where ‘the proportion of households made homeless due to the ending of a private rented sector tenancy has almost doubled since 2011.’[8] Changes to welfare legislation and the roll out of Universal Credit have also exacerbated homelessness due to rent arrears. The charity ‘Centrepoint’ has seen some people waiting 10 weeks for their first payment, placing ‘tenants at risk of homelessness, as they can legally be served a notice to seek possession when rent is unpaid for eight weeks.’[9] The government is struggling to sustain its current homelessness strategy, and housing costs work against an effective strategy, providing compelling evidence to implement an urgent social housing policy. The government have made some reforms in the last Budget to Universal Credit, notably reducing the official six weeks wait for payments to five and injecting funding up to £1.5 billion. Further housing plans have been announced, including the important move to wipe out housing association debt in an aim to kick-start more social housing. Yet many still object that this is not enough.

The Report from the DCLG also reflects how more affordable housing is necessary: ‘In 2015-16, local authorities spent £1,148 million on homelessness services, and the single largest component of this spending was on temporary accommodation.’[10] The report also expresses how the overall increase in spending on homelessness services has an impact of the spending on other elements of housing services; three-quarters of the spending in 2015-16 was funded by housing benefit, of which £585m was recovered from the Department for Work & Pensions, and over the same period spending on other components of homelessness services, mainly prevention, support, and administration, fell by 9% in real terms. There is also a further un-quantified cost of homelessness to wider public services, reiterating the economic and moral importance of prevention. This includes the additional burden on public services of homeless people who experience poorer health outcomes, admissions to hospital and outpatient services, policing, and costs to the justice system.’[11]

Housing First is an alternative approach to homelessness, founded 30 years ago in California. It involves a scheme prioritising permanent affordable housing for people with community-based supports to avoid people returning to homelessness. Housing First projects are underpinned by the principle that everybody has a right to a home, and the idea that ‘people need a home before they can begin to work on other issues,’ such as addiction and mental health problems.[12] This approach is embraced by around 30 UK services, yet not enough councils are encouraged to take it on board.[13]

Nevertheless, providing housing alone may not always achieve residential stability. Mental health is also strongly linked to homelessness. According to the Homeless Link national data, ‘80% of respondents reported some form of mental health issue’.[14] The National Coalition for Homeless have said, ‘In addition to housing, supported housing programs offer services such as mental health treatment, physical health care, education and employment opportunities… and money management skills training’.[15] Increased attention and support for mental health is fundamental. The Guardian reported that ‘about 300,000 people with a long-term mental health problem lose their jobs each year’; job loss and mental health issues can greatly feed into homelessness.[16] More mental health first aid courses and e-learning modules in businesses and institutions are needed to help identify which people need support, and when. Employees with mental health problems should receive enhanced protections according to the 2010 Equality Act, and sufficient funding is needed to ensure the NHS provides quick, convenient and high quality mental health services. Crucially, homelessness often engenders or entrenches mental health issues, creating a vicious cycle.[17] Although lack of funding is a significant barrier to increased support for mental health and housing programmes, tackling these root causes of homelessness will prove more economical than dealing with consequences – but it also requires a long-term plan rather than short-term fixes.

Student homelessness is also rising, largely due to exorbitant university fees and expensive accommodation. The NUS recently urged universities to look at ” properly planning accommodation supply and capping rent increases to ensure students are not priced out of living in halls.’[18] A drastic policy change towards reducing university fees would be effective. Alongside demands to abolish tuition fees from the Labour Party, there had been hopes that the government would slash University tuition fees to £7, 500, yet disappointingly post-Budget fees remain at £9,250 – no reduction or cap.[19] Tuition fees saddle students with debt and pressure often resulting in mental illness, financial problems and potentially homelessness, highlighting again the need for urgent change.

What do you do when a homeless person asks you to “spare some change?” Do you give some money, unsure whether that will help feed an addiction? Do you provide food and shelter? Do you go home and donate to a homeless charity? Do you feel that in giving money to charities you are preventing the government from facing their responsibilities for homelessness? Do you wonder what led to that person becoming homeless? These are all important questions to be asked – and along with the policy changes I have suggested, discourse about homelessness must be encouraged, particularly in schools, in order to promote awareness and increase public pressure for policy change. The statistics are too alarming. The British government must increase social housing, with a ‘housing first’ approach; it must increase its support for mental health care (including support for housing programmes that incorporate mental health treatment); and it must help its’ students’ well- being, namely by decreasing or eradicating university fees. The 2017 Homelessness Reduction Act is a good beginning, but it now needs support from radical social policy legislation that will allow its admirable aim to reduce homelessness to be carried out by local authorities in conjunction with vital support from non-government agencies.

Eva Barnsley is a second-year student studying International Relations at King’s College London. Her research interests include Brexit, with a focus on British welfare and education policies. She currently works in the King’s Think Tank core working group, researching issues of mental health and homelessness in the UK. She is also a mentor for Debate Mate, a global communication and leadership program, and recently worked as an intern for Janaagraha, a civic education program based in India.

Bibliography:

[1] Rough Sleeping Statistics Autumn 2017, England. (2018). [ebook] Department for Communities and Local Government. Available at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/682001/Rough_Sleeping_Autumn_2017_Statistical_Release_-_revised.pdf

[2] Cowburn, A. (2016). Homelessness in Britain: Theresa May unveils £40 million fund to prevent. [online] The Independent. Available at: http://www.independent.co.uk/news/uk/politics/theresa-may-unveils-40- million-fund-to-prevent-homelessness-in-britain-a7365796.htm

[3] Perraudin, F. (2017). Andy Burnham Launches Plan to Drive Down Homelessness in Manchester. [online] The Guardian. Available at: https://www.theguardian.com/uk- news/2017/may/08/andy-burnham-vows- to-put-words-into-action-in-greater-manchester

[4] Watts, M. (2016). Sadiq Khan announces £50m fund to house homeless as he backs The Independent’s Christmas Appeal. [online] The Independent. Available at: http://www.independent.co.uk/news/homelesshelpline/sadiq-khan- homeless-accommodation- london-mayor-the-independent-helpline-appeal- a7486631.html

[5] Homelessness Reduction Act 2017. (2017). [ebook] Norwich: TSO (The Stationery Office) Controller of Her Majesty’s Stationery Office and Queen’s
Printer of Acts of Parliament. Available at: http://www.legislation.gov.uk/ukpga/2017/13/pdfs/ukpga_20170013_en.pdf

[6] Welsh Government|New homelessness legislation. [online] Available at: http://gov.wales/topics/housing-and-regeneration/services-and- support/homelessness/new-homelessness-legislation/?lang=en

[7] england.shelter.org.uk. (2017). [online] Available at: http://england.shelter.org.uk/campaigns_/why_we_campaign/tackling_homeles sness#how_to_prevent_homelessness

[8] Albanese, F. (2015). The Single Biggest Cause of Homelessness – Homelessness in Numbers Briefing #1. [Blog] Available at: http://www.homeless.org.uk/connect/blogs/2015/jun/24/single-biggest-

[9] Jayanetti, C and Savage, M. Revealed: Universal credit sends rent arrears soaring. [online] The Guardian. Available at: https://www.theguardian.com/society/2017/sep/16/universal-credit- rent- arrears-soar)

[10] Homelessness. Report by the Comptroller and Auditor
General
[ebook] National Audit Office, Department for Communities and Local Government. Available at: https://www.nao.org.uk/wp-

[11] Ibid.

[12] Housing First in the UK and Ireland. (2017). [ebook] Chartered Institute of Housing. Available at: http://www.cih.org/resources/PDF/Scotland%20Policy%20Pdfs/Housing%20F irst/CIH0220-PDF-B_Housing%20First_RV_13112017%20FINAL.pdf

[13] Home | Homes First, Because Everyone Needs A Home. [online] Homesfirst.on.ca. Available at: http://www.homesfirst.on.ca

[14] Homelessness and health research.[online] Available at: http://www.homeless.org.uk/facts/our-research/homelessness-and-health-

[15] Mental Illness and Homelessness. (2009). [ebook] Washington: National Coalition for the Homeless. Available at: http://www.nationalhomeless.org/factsheets/Mental_Illness.pdf

[16] Saddique, H. (2017). Mental health problems are forcing thousands in UK out of work – report. [online] The Guardian. Available at: https://www.theguardian.com/society/2017/oct/26/thriving-work-report-uk- mental-health- problems-forcing-thousands-out

[17] Homelessness and mental health. [online] Available at: https://www.mentalhealth.org.uk/blog/homelessness-

[18] Page, A. and Young-Powell, L. (2013). High prices leave students homeless: Can you afford to live at uni? [online] The Guardian. Available at: https://www.theguardian.com/education/abby-and-libby- blog/2013/oct/31/too-poor-for-student- halls

[19] Worley, W. and McIntyre, N. (2017) Tuition fees could be ‘slashed to £7,500’ a year under government plans, report says. [online] The Independent. Available at: http://www.independent.co.uk/news/uk/politics/government-reduce- tuition-fees-7500-autumn- budget-philip-hammond-a7951081.html

 

The UK and European Competition Law

 

Abstract

         In light of Brexit, the UK will not be able to remain in the EU’s  single market. However, since the UK was member of this market for roughly four decades, we are faced with a dilemma regarding the status of the UK with regards to EU Competition Law. The UK recognizes both that competition law is essential to good business and to trade relations, in particular in light of these uncertain times (where this has not developed as quickly in the EU as would be desired).Therefore, this recommendation seeks to establish how the UK should proceed in relation to EU Competition Law to ensure that trade and business are not undermined by Brexit. In this paper, King’s Think Tank recommends that the general framework of EU Competition Law be continuously maintained and re-introduced as domestic legislation, potentially as ‘the Competition Law Act 2019’. However, we suggest that certain amendments should be added if such Act would be adopted. An example of the proposed amendments is  the creation of Categories of legal standards of proof beyond the object effect distinction currently used by the European Courts of Justice (referred to in this article as the ECJ). Since the object effect distinction is a topic of contention within EU Competitive Law, we believe this sets our policy apart and could ensure that the UK has the best standpoint from a legal perspective/where the law is concerned, to remain competitive within the market. We recommend that this such a bill should be drafted as soon as possible, considering the fact that the UK is set to leave the EU by March 29th, 2019. Hence, through this paper, we seek to prove that this bill, alongside other trade related bills, should be given priority in Parliament because preserveing businesses and markets is of the utmost importance to the UK’s economy.

Policy Recommendations

  1. Maintaining the general framework of EU Competition Law and re-introducing this into domestic legislation as the Competition Law Act 2019

Considering the current political climate and fears of destabilization of the United Kingdom’s market and business sector, our first policy recommendation is that the UK should continue to  adhere, for the most part, to the general framework provided by EU Competition Law as laid out in:

  1. Treaty on the Functioning of the European Union (2012/C 326/01), Articles. 101, 102 and 104.
  2. Commission Regulation ( of the EU) No 330/2010 of 20 April 2010 on the Application of Article 101(3) of the Treaty on the Functioning of the European Union to categories of vertical agreements ( This is a Block Exemption Regulation).
  3. Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings (EC Merger Regulation) and the Implementing Regulation (EU) No 1269/2013 (In technical terms: an implementing Regulation).

We hence propose that the UK would, based on the aforementioned legislation, produce its own domestic legislation: the proposed Competition Law Act 2019. Such a bill would be drafted in the upcoming two years. Hence, its introduction to Parliament could be executed  swiftly following the Britain’s exit from the EU that would be final by May 29th 2019.

By doing this,  the UK would demonstrate its commitment to combat anti-competitive behaviour and ensure market fairness, even though it would no longer be under under the jurisdiction of the ECJ, and all  other EU regulations. On a more practical aspect, there would be minimal conflicts of law between the UK and one of its main trading partners, the EU. This would, in turn,  facilitate business transactions and, if conflict arises, the similarities between jurisdictions would ensure coherent handling of these cases.This solution would also ensure the UK’s place in the global market while satisfying hardline ‘Brexiteers’ who are skeptical of the EU’s ‘overbearing influence’.

  1. Amendments to certain aspects of Competition Law to match international system

The second policy recommendation this paper advances is updating the UK’s current EU-based framework of Competition Law, to match global developments in this field. This would be achieved  by the following two ways:

A. Through the the creation of a Competition Law ‘Best Practices Investigation Committe’

This committee would research and determine how to regularly update UK Competition Law to best meet the demands of today’s global business and the UK’s role within it. Using the OECD Competition Law Committee’s recommendations, this would place the UK at the forefront of innovation in the areas such as; (i) International Co-operation on Competition Investigations and Proceedings; (ii) Fighting Bid Rigging in Public Procurement and; (iii) Regulatory Quality and Performance

There is little doubt that the UK Common Law‘s system and  existing statutory legislation has long been a model of effective law; this initiative would continue this legacy. While the aftermath of Brexit may be destabilising, it does offer an opportunity to improve the law. This would be achieved if we adopt a long-term perspective of internationalism, that would not only stabilise the UK’s economy, but eventually attract more investors and companies to the British market.

B. Improving the categories of legal standards of proof beyond the object/effect distinction

 The method of setting legal standards of proof (proposed and implemented by the Courts of Justice of the European Union) relies upon on the object/effect distinction. This outdated system, established in the 1940s, has been heavily criticised by academics and legal practitioners (see later section on failures of this policy). The simultaneous lack of breadth coupled with  vague definitions of this distinction have led to uncertainty as to whether a case would be seen or not to fall under the object or effect distinction. By adopting standards based on the US Anti-Trust Legislation, cases brought under UK Competition Law would benefit in two ways. By this, the following two categories are specifically implied:

  1.  Standards of Proof Categories would be more accurate. This would ensure that law is far clearer and more comprehensive. It would also mean that the CJEU’s stretching of definitions would no longer be necessary. Anti-competitive behaviour will no longer be simply “object” or “effect”.
  2.  Procedures would be less costly and less lengthy (the current case lasts on average 4 years). With six categories or more, the standards of proof could be appropriately met with the necessary amount of investigation. These principles, borrowed from the American system would ensure clearly defined categories of anti-competitive behaviour, each with their own necessary standard of proof, investigation process and penalties. This would make the enforcement of Competition Law more effective, and hence this would be better at  protecting perfect competition and healthier markets.

3.   Increasing the budget of the National Regulatory Bodies (Financial Conduct Authority and Competition and Markets Association)

The purpose of this would be to (1) Reassure investors and (2) Confirm the UK’s commitment to combating anti-competitive behavior. The proposed budget increase would be approximately of  5%. For context, the CMA’s total operating expenditure in 2016/17 was of £138,227,000[2], whilst the FCA’s annual funding requirement for 2016/17 was of £519,300,000[3]. The increase on the budget would supposedly invest an additional £6,911,350 in the CMA, and £25,965,000 in the FCA. Giving these regulatory bodies an increased capacity would empower them to have a more present role in regulating competition, thus this would compensate for  the EU’s absence in this effect. Further, additional spending would be required to fund the Investigation Committee, the purpose of which would be to integrate OECD Competition Committee Recommendations to UK competition law.

Failures of Previous Policies

The previous policy would  be a continuation of the UK’s current position. In other words, being a country bound by the EU Competition rules  that are based on the TFEU. This has resulted in the UK being bound by laws that have been decided through cases handed down by CJEU.

The policy we propose, however, would effectively be  an update from the object/effect distinction that the CJEU adopts in order to determine anti-competitive behavior and the investigation to discern this. Whether an agreement is anti-competitive by object or by effect is cannot always be ascertained with certainty by business and decision makers. Even if these problems have been recognised by the EU, the CJEU strives to achieve consistency in its judgments and a change in its  position would potentially make EU Competition jurisprudence irreconcilable.[4]

Another problematic area which has arises with regards to EU case law is the struggle to identify an operational definition of competition what is ‘restriction by competition, specifically in light of Article101(1) TFEU.[5] This leaves market participants and business to rely on the black boxes  that are supplied as commission guidelines. But, this is by no means exhaustive. This would leave business and enterprises less certain on areas which may fall into the gaps that arise as a result of these guidelines.

At present, adherence to the EU’s  system has led to  a number of lengthy cases being heard at the CJEU; this attracts costs for litigants as well as EU member states who must pay for the costs of holding CJEU trials through membership fees. Indeed, a more cost effective approach which renders more certainty would be to have a spectrum of what constitutes an infringement of competition rules. This would solve the current system’s failure that  has resulted in attempts to pigeon-hole an action into either an object that results in anti-competitive behaviour or an action which effectively results in anti-competitive behaviour.

Continued adherence to the EU law and enforcement has rendered the UK unable to engage in behaviour that may uplift its own home industry. Under EU State Aid Rules, the EU prohibits the UK from distorting competition by granting aid to specific businesses.[6] A failure of this previous position is the UK’s inability to have a say in which market participants are crucial to the functioning of its economy and ways in which it can assist them. A change to the proposed policy would allow the UK to provide aid to businesses without fear of EU action. This would be beneficial in key industries such as manufacturing and technology which are seen as strategically important industries.

Final Evaluation

Although we are of the opinion that the proposed policy is the best approach to the current situation,  there are certain flaws. Since the UK would be leaving ECJ jurisdiction, some critics might argue the UK will essentially be able to pick and choose which newly established EU principles to incorporate and apply into the new laws. While this is a valid point, the UK will still refer previously established ECJ legislation. Indeed, this is a matter of balancing the positives of having a more flexible source of law as opposed to a more rigid code. Regardless of whether the UK decides to retain EU principles of Competition Law, the years it has spent as part of the EU cannot be erased from its legal history. This means that courts in Great Britain will have to continue referencing CJEU cases when analyzing previous decisions. Thus, it is pertinent to argue in favour of retaining the  same legal model but without direct CJEU influence.

Another point of contention might be the increased expenses that will be incurred by this policy recommendation. These costs, however, should be seen as increased investments in the UK’s own legal system and regulatory bodies that would give investors certainty in the UK’s system and markets. Finally, although the refusal to adhere to ECJ jurisdiction and ECJ rulings could potentially put further strain on the UK’s position in Brexit negotiations, we are of the opinion that the UK’s commitment to adhering to EU Competition Law and its commitment to Competition Law through the ICN can be seen as a sign of good faith.

Conclusion

As of yet, the consequences of Brexit are unknown. The policy proposed by this paper is in some ways damage control following a great deal of social and political upheaval. However, the UK should welcome this opportunity as a chance to improve upon the position that was initially soley based upon EU Competition Law. The proposed approach would also bring about certainty and cost savings to disputes that exist in the UK’s market. Finally, the proposed creation of a committee that investigates the most desirable aspects of Competition Law will give Britain a competitive advantage as well as a golden  opportunity to produce a forward-looking, domestic form of  Competition Law that is compatible with internationally accepted practices.

This policy paper was written by Tadiwa Mandinyenya, Valentina Buccoliero, Lucia Saborio Perez and Gabrielle Stassart at ‘Policy Day’, one of  King’s Think Tank’s annual policy workshops (held on the 13th January 2018).

Endnotes:

[1] ICN Mission Statement, http://www.internationalcompetitionnetwork.org/

[2] CMA budget 2016/2017: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/628985/cma-annual-report-accounts-16-17-print-ready.pdf

[3] FCA budget 2016/17: https://www.fca.org.uk/publication/business-plans/business-plan-2017-18.pdf#page=89

[4] Yi Heng Alvin Sng: The Distinction between “object’ and ‘effect’ in EU competition law and concerns after Groupmeant des Cartes bancaires

[5] Pablo Ibanez Colomo, Market failures, transaction costs and article 101(1) TFEU Case Law

[6] https://www.twobirds.com/en/news/articles/2016/uk/competition-law-implications-of-a-brexit

 

References:

  1. http://www.internationalcompetitionnetwork.org/members/member-directory.asp.
  2. http://www.oecd.org/competition/recommendations.
  3. htmhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/628985/cma-annual-report-accounts-16-17-print-ready.pdf
  4. https://www.fca.org.uk/publication/business-plans/business-plan-2017-18.pdf#page=89