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Article originally published in The Independent on 9 November 2014.

Councils paid to cut smoking, but have £2bn of tobacco shares

By Jan Goodey, Jennifer Kennedy, Cahal Milmo, Ed Jones

Local authority pension funds have nearly £2bn invested in the tobacco industry despite the county councils they represent being responsible for promoting public health, including anti-smoking campaigns, The Independent on Sunday can reveal.

Figures obtained under the Freedom of Information Act show for the first time the full extent to which the 99 regional pension funds, representing 4.6 million public sector workers, own shares in the tobacco giants that promote smoking around the globe.

Local authorities in England and Wales have holdings in cigarette producers worth £1.8bn, of which more than half – £953m – is invested in a single company, British American Tobacco.

BAT, which is one of the world’s largest tobacco companies and is based in London, is among the companies lobbying against the introduction of plain packaging for cigarettes in Britain as well as pushing sales in developing countries. It has recently set out a “harm reduction” strategy aimed at developing safer nicotine-based products such as e-cigarettes, although the vast majority of its earnings still come from selling normal cigarettes.

Campaigners and experts say the substantial holdings amount to “blood money investment” by local authorities and are unacceptable because of the transfer last year of responsibility for improving public health through promotions, including high-profile anti-smoking campaigns, to councils in England. This year, the Department of Health paid £2.79bn to local authorities for public health campaigns on subjects including smoking prevention and cessation, such as the “Stoptober” campaign.

According to the FoI figures, some eight in 10 of the regional pension funds have tobacco holdings, and just 10 funds are responsible for nearly half of the total – £822m worth of shares.

The tobacco shares are held as a mixture of direct investments by funds and indirect holdings through managed or pooled funds.

The largest investor is West Yorkshire, with shares worth £186m, followed by the London Borough of Barnet, with £116m. The five local authorities making up the West Yorkshire fund will receive £128m this year for public health promotions – representing more than two-thirds of the value of their tobacco investment – while Barnet will receive £14.3m.

John Middleton, the policy head at the Faculty of Public Health, said: “These amount to blood money investments. They are simply incompatible with the role local authorities now have in assuring the health of the populations they serve. There is a clear case for local authorities to disinvest from these funds or risk undermining their credibility.

“We have a situation where, if a local authority employee is a smoker, then they risk not seeing their pension through premature death. How can investing in a strong tobacco industry be in the best interests of those fund members?”

Campaigners said the figures should increase the pressure on council committees and trustees who oversee the pension funds to liquidate their tobacco holdings, on both ethical and investment grounds.

The number of smokers in England fell by 1.1 per cent last year to a historic low of 18.4 per cent of the population. At the same time, smoking remains the single largest cause of preventable illness and premature death in Britain, costing the NHS an estimated £2bn a year.

A global squeeze on tobacco sales following the introduction of anti-smoking legislation in key markets such as China and the effects of the economic slowdown have also hit the performance of some of the big so-called “sin stocks”.

Imperial Tobacco, the second largest recipient of local authority investments, last year announced its first fall in profits in 17 years; while, in October, BAT, whose brands include Lucky Strike and Dunhill, revealed that it had sold 495 billion cigarettes in the first nine months of 2014 – a 1 per cent fall year on year. Both companies insist their overall financial performance remains strong.

Stewart Brock, of the Tobacco Free Pensions campaign, said: “Tobacco has seriously underperformed the market in the past year or so, when it has previously always done well in recessions. Tobacco volumes are falling worldwide. The economic case for divestment is getting stronger.”

Pension funds say they have a legal or fiduciary obligation to “maximise financial return” and cannot give consideration to ethical issues. But new regulations for the Local Government Pension Scheme, the umbrella body for the 99 council funds, allow local authorities to take into account the “public health implications” of their investments, opening the way for divestment.

This summer, Croydon Borough Council became the latest of a small number of local authorities to declare that its pension holdings would become tobacco free and placed instead with an ethical fund, following the example of two other London authorities, Newham and Brent. Suffolk County Council has asked its pension trustees to take similar steps.

Simon Hall, Croydon’s cabinet member for finance, said: “The council will be getting a better investment deal, as ethical funds are performing favourably against other schemes. Tobacco is not the low-risk, high-profit investment it once was.”

The tobacco companies insist the sector’s financial performance remains robust. In a statement, the Tobacco Manufacturers’ Association said: “Tobacco is a legitimate industry and people are free to choose to invest in tobacco stocks. Fund managers should be free to make the best financial decisions for their investors.”

Deborah Arnott, the chief executive of the health charity ASH, said: “Councils have a legal duty to get the best deal for their pensioners and taxpayers, and another legal duty to promote the health of local people, so we recommend they take legal advice on this tricky issue.”

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45erd-badges

I feel deeply sad that the Scots decided to vote No to independence. Although Alex Salmond and the SNP definitely had their faults (especially with some of their policies), and I had more sympathies with the vision of the Radical Independence Campaign, Common Weal  and the Scottish Greens, what the YES campaign did was to inspire hope that another kind of politics could happen, as George Monbiot argued so well. That there could be an alternative to the last 30 years of neoliberalism, ramped up by Margaret Thatcher and continued by New Labour. An alternative to austerity economics, which has hit the poorest the hardest, has further entrenched inequality (of wealth, property, opportunity), foodbanks, homelessness and which has given the excuse to privatise the Royal Mail, large parts of the NHS, and much more. I wanted to see if Scotland could go down a different path

Although Salmond has at times been in bed with Rupert Murdoch and Donald Trump, and had advocated lowering corporation tax if Scotland gained independence, there were signs that an independent Scotland could have gone a different direction. One of them was that Rupert Murdoch came out against some of Salmond’s allies and policies at the end, which meant the Scottish Sun didn’t support independence. Murdoch said on twitter:

Already in Scotland there are much more progressive policies in many areas. University education is currently free in Scotland, instead of up to £9,000 a year in England, which can end up as around £100,000 in repayments. They have a roadmap to generate the equivalent of 100% of Scotland’s gross annual electricity consumption with renewables by 2020 (although some of what they include as renewable is contentious, is reliant on exporting and importing energy to England during peak and trough times and it is uncertain if they will meet this ambitious target), instead of the situation in Westminster where a very large proportion of Conservative MPs still don’t even believe climate change is caused by humans, including the former Environment Secretary Owen Paterson. Much more of the NHS in Scotland is still in public hands, unlike in England, where New Labour and then the ConDem coalition have been privatising it like crazy. It’s got so bad in the rest of the UK that Doctors told Scots in The Lancet to vote for independence to stop it being privatised as well as the fact that doctors, nurses and other medical professionals have also gotten together to form their own political party to fight to protect the NHS – the National Health Action Party.  The Scots have also been discussing land reform, including from the 432 people who own 50 per cent of rural Scotland, and have made initial steps to implement it. They already have a more democratic and proportional voting system for the Scottish Parliament than the first past the post system used in the UK general elections. I could go on.

I had hoped to see how an independent Scotland would continue these many trends. If they gained independence, Salmond, amongst other things, had promised to:

Whether they would have done those things once independent is another matter, but it would have been exciting to see them try, and maybe that would have helped shift the debate in the rest of the UK as the Scottish led the way on what could be achieved.

So, why did they lose the vote?

Of the  84.15% of the Scottish population who turned out to vote, 45% voted YES for independence, while 55% voted NO. Unfortunately there were no exit polls, but an Ashcroft poll of more than 2,000 people showed how different age groups voted:

HowVoteInReferendum(Source)

This led to some saying: “The old have killed the hopes of the young”. However, when looking at the above data, it’s important not to make too much of the 71% of 16-17 year olds who voted for YES. As Full Fact pointed out:

Various media sources and Twitter users have today reported on the results of a poll by Lord Ashcroft, which showed that 71% of 16- and 17-year-old respondents said they voted Yes to independence. However, this figure (available in underlying data tables) is based on just 14 responses in this age group – that’s ten yes-voters. Such a small sample means there’s a huge range of uncertainty around the estimate, so it’s impossible to say whether this figure is representative of the actual proportion. The proportion of 16- to 24-year-olds that said they had voted yes (based on a more robust 98 cases) was 51%.

Even still, a majority of people from 25-54 voted YES, and those over 65 overwhelmingly voted NO.

Others pointed out that areas with more deprivation, unemployment, urban population and shorter life expectancy had bigger support for independence (although the small sample of 32 local authorities may be too small to be certain about that):

ScotVotingLifeExpectancy

(Source)

votedeprevation

(Source)

(For more graphs looking at the relationship between urban/rural population, percentage of those on unemployment benefits and more see this and this)

So, if you believe the above correlations as being significant with the limited data available, the old and the rich were much more likely to vote NO, and the poor and young were much likely to vote YES. There are many theories as to why that is, which I wont go into here.

It’s also interesting to look at what the main reasons which were given for voting NO. As Ashcroft pointed out from his poll:

By far the most important reason [for voting NO] was that “the risks of becoming independent looked too great when it came to things like the currency, EU membership, the economy, jobs and prices”. Nearly half (47%) of No voters said this was their biggest consideration. This was echoed in the more specific issues people said had played a part in their vote. The pound was the single most important of these, mentioned by more than half (57%) of all No voters. Nearly four in ten (37%) were concerned about pensions, and 36% cited the NHS (as did more than half of those who voted Yes).

So it wasn’t just about age and wealth.

Propaganda onslaught

To be honest, I’m amazed that 45% of the population did vote YES with the propaganda onslaught against independence. As Craig Murray, former British Ambassador to Uzbekistan and Rector of the University of Dundee, pointed out:

My heart is still bursting with pride that 45% of Scots – a people devoid of political autonomy for three hundred years – had the nerve, intellect and will to see through the avalanche of propaganda from the entire mainstream media, political establishment, banking sector and corporate world. I met numerous voters who had received letters from their employers – including Diageo, BP, RNS and many others – telling them to vote No or their job was in danger. I met the old lady in Dundee who was told by the Labour Party that independent Scotland would flood the country with immigrants, and a Romanian building worker in Edinburgh who had been told by the Labour Party that Independent Scotland would deport all East Europeans.

George Monbiot also pointed out that:

there is no newspaper – local, regional or national, English or Scottish – that supports independence except the Sunday Herald.

A team of academics even studied the BBC’s coverage of the independence referendum between 17 September 2012 – 18 September 2013, looking at 730 hours of evening TV news output broadcast by BBC Scotland and Scottish Television (STV), and found the BBC to be very biased against Scottish independence. This research was then stonewalled and mostly unreported by the BBC. The BBC then went above the researchers head to his Principal at the University of West Scotland to try (unsuccessfully) to discredit the research.

Other studies of the BBC, on other aspects of their reporting, have found similar results of bias, including:

On BBC News at Six, business representatives outnumbered trade union spokespersons by more than five to one (11 vs 2) in 2007 and by 19 to one in 2012.

So, bearing all this in mind, it really is amazing that 45% of the Scottish population voted for independence. Even though they didn’t win, it seems like a small victory for alternative media (Bella Caledonia, Open Democracy) and other information sources (Twitter, Facebook), which provided lots of analysis and facts supporting the case for independence. This is maybe a sign of hope for the future, as ideas not normally presented in the corporate media (whether due to the Manufacturing of Consent as described by Noam Chomsky or the Churnalism as described by Nick Davies) were able to be distributed and discussed through alternative channels. As the internet generation gets older, and hopefully less exclusively reliant on corporate media, maybe it will vote YES at the next referendum for independence?

The future in Scotland?

Even though Scotland voted NO to independence, there has been a massive shift in political consciousness. A facebook community has been created after the vote – We are the 45% – which now has over 160,000 people following it. The Radical Independence Conference has now had over 6000 people sign up to attend. Over 3000 people, since the referendum, have joined the Scottish Green Party (who supported independence), more than doubling its size:

While the SNP has experienced an even bigger surge of support:

The Scottish Socialist Party has also almost doubled in size.

Many are channelling their recent politicisation by the referendum into the political parties and movements which supported independence. Whether we like it or not, the state makes the rules and laws which govern our lives, so more active engagement with politics by a larger amount of people gives me hope for the future direction of Scottish politics and that better policies will be introduced. As Andy Wightman, author of The Poor Had No Lawyers: Who Owns Scotland (And How They Got It), recently said:

Meanwhile, in England, Jack Straw, the Labour MP who helped take the UK into the illegal war in Iraq, now wants to make it illegal to dissolve the union in the future unless a majority of MPs in Westminster parliament agree to it.  And many are questioning whether the ConDemLab coalition will follow through with the vow of further devolution promised if a NO vote happened.

Whatever happens, it is exciting times for Scotland ahead. The population has been politicised and will fight even more for change.

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Article originally published on 27 April 2014 in The Independent.

Local authorities have ‘conflict of interest’ on fracking investments

By Jan Goodey, Cahal Milmo, Will Cottrell and Ed Jones

Councils that will play a key role in deciding the future of fracking in Britain have investments worth millions of pounds in companies behind the energy extraction method, The Independent can reveal.

Local authorities in areas identified as potential sources of gas have holdings via their pension funds in firms seeking to drill within their boundaries. One of the most significant investments is £1.9m held by Lincolnshire County Council’s pension fund in Total, the French company that earlier this year became the first oil major to enter Britain’s dash for shale gas, with a £30m stake in two exploration projects in the county.

West Sussex County Council also has indirect holdings in Cuadrilla, which was at the centre of controversial tests in the village of Balcombe last summer. The council also has substantial investments, currently worth £3.5m, in Centrica, the parent company of British Gas – which last year took a 25 per cent stake in a Lancashire shale-gas project operated by Cuadrilla, albeit not directly.

The Greater Manchester Pension Fund (GMPF), which invests on behalf of Salford and Trafford councils,  holds shares in Henderson Group, a major investor in IGas, another fracking exploration company that is conducting shale-gas tests in the Salford area.

All the councils insisted there was no conflict of interest between their pension-fund investments and past or future planning decisions on fracking projects. They pointed out that shares had been bought in all cases except Lincolnshire via investment funds,  and councillors involved with pension fund-related decisions did not sit on their planning committees.

But campaigners said it sent the wrong signal and called on the local authorities to sell their holdings.

Simon Clydesdale, energy campaigner for Greenpeace UK, said: “It’s a worrying discovery. Fracking is already a dirty enough industry without getting mired in the murky waters of conflicts of interest. Councils must disinvest and show local voters that they can be trusted to put the interests of their constituents first when making crucial decisions on fracking applications.”

With assets worth about £120bn, local authority pension funds are among Britain’s largest investors.

David Forbes, Lincolnshire’s assistant director of resources, said: “The pension scheme operates within a set of clear investment principles and is overseen by the pension committee, which makes its decisions independently from the county council.”

West Sussex County Council said its investment in Cuadrilla, worth some £26,000, was minimal and equated to some 0.001 per cent of the total value of its £2.45bn pension fund. In a statement, the council said: “Any indirect investments made by the pension fund’s investment managers would not have any influence at all in determining a planning application.”

Salford City Council said its planning panel members had no role in deciding where GMPF invested its funds. GMPF acknowledged its holding in Henderson Group but said it had no investment, direct or indirect, in IGas.

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This article was originally published on 24th February 2014 in The Ecologist

Special Investigation Planners’ pension funds set to win from fracking permissions
Jan Goodey, Will Cottrell & Ed Jones

Two Councils at the front line of fracking protests – Greater Manchester and West Sussex – have pension funds investing in the major fracking operators – while decisions on planning applications to frack are pending.

The findings – which have emerged from a special investigation for The Ecologist – reveal a serious conflict of interest as the value of planners’ pensions could be affected by the decisions they are making.

West Sussex County Council Pension Fund (WSCCPF) invests in IGas, Celtique Energie – and Cuadrilla, which made the news headlines in the summer at Balcombe.

Greater Manchester Pension Fund (GMPF) has the same interests in the big three with IGas currently facing protesters at Barton Moss near Salford.

The spreading tentacles

Lawrence Carter, energy campaigner at Greenpeace UK said: “After the business rate bribes promised by the government, it now turns out that councils have their pension pots riding on the outcome of fracking applications. These councils appear to have a worryingly large stake in the success of the UK’s fracking industry.

“Fracking is a highly controversial issue and council authorities owe it to their citizens to ensure that they are far beyond even the slightest suspicion of a conflict of interest. Local councils are institutions trusted by the vast majority of the population – they need to do all they can to retain that trust.”

In Balcombe, Cuadrilla is waiting on planning permission from West Sussex County Council to continue its controversial work from last summer with a series of flow tests to assess the viability of fracking.

WSCCPF invests in the US firm to the tune of £3.8m through its UK partner, Centrica. It has also invested in IGas, which has a licence block covering the West Sussex town of Storrington.

This investment is via IGas shareholder Ballie Gifford, a fund manager for WSCCPF. The firm is the recipient of the largest WSCCPF investment – £187m – an undisclosed proportion of which is invested in IGas.

Celtique Energie is looking to frack in nearby Fernhurst, Billingshurst and Wisborough Green. It too is a potential money-spinner for the Council, although to a lesser extent: WSCCPF has fracking investments through two portfolio funds, Partners Group and Pantheon Global Secondary Fund (under £5,000 in each).

‘No conflict of interest’, insists West Sussex

A West Sussex County Council spokesman told The Ecologist: “There is not a conflict of interest. Bailie Gifford has a discretionary mandate and make investments to fulfil the obligations on the pension fund. Whether or not we hold any stocks in our pension fund will not alter any planning decision that we do or do not take.”

The West Sussex Pension Fund, worth some £2.45 billion, is one of the larger local authority pension funds in England and Wales.

As well as the County Council it takes in the University of Chichester, Chichester College, Central Sussex College, several district councils in the area and more than a dozen town and parish councils – plus local housing associations and public and voluntary sector organisations.

The fund invests in a number of other controversial companies in arms and tobacco. It holds shares worth £8.5m in British American Tobacco and £4.5m in BAE Systems.

Manchester Councils – heavily committed

Further north, Salford and Trafford Councils, which have granted permission for IGas to drill at Barton Moss and Davyhulme, have investments through the GMPF, with £108m in the Henderson Group which through a subsidiary, is a major shareholder in IGas.

GMPF also has holdings totalling £73m in Cuadrilla via partner, Centrica and £10m in Pantheon Global Security Fund IV and £1.9m in Partners Group, both portfolio funds which invest in Celtique Energie.

While the permit IGas holds in Barton Moss is for coal bed methane exploration, the company has stated that it is also considering shale gas extraction by fracking in the future.

No conflict of interest that we’re aware of …

A Salford Council spokesperson told The Ecologist: “Planning permission for coal-bed methane exploration drilling was given in 2010, when the city’s Planning Panel considered all the issues carefully, heard a great deal of evidence, and granted permission for the exploration to take place.

“Councillors who took the decision to grant planning permission to I Gas in 2010 for coal-bed methane exploration were not made aware of GMPF’s investments in Henderson Global Investors. There is no conflict of interest that we’re aware of.

“The members of Planning Panel have no role in deciding where GMPF invests its funds and had no role in deciding that GMPF should invest its funds in Henderson Global Investors.

“Should the company or anyone else wish in the future to engage in anything further than they have been given permission for, they would have to seek separate planning permission from the Council. They would also require permits from both the Health and Safety Executive and the Environment Agency, which are the regulatory authorities for these issues.”

Conflicted responsibilities?

The Ecologist has looked into the possible conflict of interest should councillors work both in planning and pension fund management. On its website WSCC Pensions Panel states that it

“wishes to be an active shareholder and exercise its voting rights to promote and support good corporate governance principles, which in turn will feed through into good performance.

“The Pensions Panel has directed the fund managers, in acting in the best financial interests of the scheme, to consider, amongst other factors, the effects of social, environmental and ethical issues of the performance of a company when considering the acquisition, retention or realisation of investments for the scheme.”

While there is no direct crossover between planning and pensions, in West Sussex, Conservative Councillor Steve Waight is on both the Pensions Panel, and the Performance and Finance Select Committee.

Two others – Conservative Cllr Liz Kitchen and Lib Dem Robin Rogers – sit on the same Finance Committee as well as on the Planning Committee.

Trafford Council’s Conservative Cllr Alan Mitchell is on the GMPF Pension Panel and at the same time is on the Executive Committee in charge of Highways and Environment. The Executive is responsible for all key decisions and the strategic management of services.

In nearby Salford, Labour Cllr Bernard Pennington is also on the GMPF Pension Panel and at the same a member of the Finance and Budget Scrutiny Committee.

Local MPs: ‘no comment’

Barbara Keeley, MP for Worsley and Eccles South (which covers Barton Moss), said she could not comment on the WSCCPF as it was not in her remit. When questioned about the wisdom of investment in extreme extraction over and above renewables she made no comment.

The Ecologist also approached Andrew Tyrie MP for Chichester in West Sussex who also did not comment.

This investigation follows a broader picture of local council investment in tobacco and arms companies at a time when NHS resources are stretched and Middle Eastern military repression continues apace.

‘We will not be bought off!’

Meanwhile closer to home other local councillors have rejected government plans to allow councils to keep 100% of business rates from fracking operations, rather than 50% as before.

In Hampshire, the Conservative leader of the county council, Roy Perry told the Portsmouth News that “the Council will not be ‘bought off’ by David Cameron’s offer of extra revenue if it approves applications for fracking.”

On a broader scale some pension funds are already pulling money out of fossil fuels, fearful of owning ‘stranded carbon’ assets. Nearly $2bn has been pulled out of fossil fuel shares with 17 of the world’s largest funds saying that they would reinvest their money in clean energy.

The Green Light Campaign has been set up specifically to encourage pension funds to pull out of the fossil fuel business altogether.

Lancashire – investing in renewables

This comes in the light of a number of leading scientists including Sir David King, the Foreign Office Special Representative on Climate Change, warning that fracking would have “enormous environmental consequences”.

In a positive example of what can be done, just down the road from Barton Moss, Lancashire County Pension fund has recently invested £12m in the world’s largest community-owned solar power station, Westmill Solar Cooperative in Oxfordshire.

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The article below was originally published in Red Pepper in February 2014

Brighton & Hove’s council tax referendum: the pros and cons
Ed Jones looks at the rights and wrongs of a referendum on whether to raise council tax by 4.75 per cent in order to protect services

brighton-pierPhoto: dawarwickphotography/Flickr

Almost all government policies have pros and cons, winners and losers – and the proposed Brighton & Hove referendum to raise council tax by 4.75 per cent is no exception. This article looks at who would gain and who would lose from the plan.

Firstly we need to put the referendum in context. It is being held because of the austerity measures imposed by the Conservative-Liberal Democrat coalition government, which have meant that Brighton & Hove’s council budget has to be cut by around £100 million over four years. The referendum on a 4.75 per cent council tax rise has come about because of a cap on council tax increases above 2 per cent imposed by central government. The only way to get a rise above that approved – to help protect the services which vulnerable people depend on – is a referendum.

Already, many poor, sick and disabled people are suffering as a result of austerity measures while taxes are being cut for the rich and corporations. There has been a soaring rise in homelessness, food bank usage and people choosing between heating their homes or feeding themselves. Further cuts would most likely continue this trend.

Council tax in Brighton

It is important to know that Brighton & Hove administrations of all political hues have previously raised council tax at higher levels than 4.75 per cent, and sometimes much higher, before the law changed on council tax rises. Here is a year-by-year breakdown of council tax rises in recent years. Red indicates Labour administrations, blue Conservative, and green Green.

tax-increaseFigures provided by the Green Group of councillors

The Greens are a minority administration, which means that Labour and the Tories have been able to team up and prevent previous council tax rises – this is why the 2012-13 rise was 0 per cent. This, taken alongside inflation, has made the funding shortfall for services even more serious.

So, what are the pros and cons of the plan?

Cons

1) The price of the referendum

Opponents of the referendum have argued it is an additional expense that the council can ill afford. There are a range of estimates of how much the referendum will cost. The Green group of councillors says the cost of holding the referendum at the same time as the European elections in May ‘is currently estimated at about £230,000, though this doesn’t include other costs such as dealing with an increased volume of residents’ enquiries about council tax’.

According to council figures, there are currently around 275,000 people living in Brighton & Hove, with around 120,000 eligible households which pay council tax, before taking into account discounts such as those available to those on low incomes and single person households. That means, if the above figures are correct, the referendum would cost around £1 per person in Brighton & Hove, or £2 per eligible household.

2) Residents can’t afford to pay more council tax

There is a cost of living crisis as the prices of housing, food, energy, water, transport and more skyrocket while wages continue to stagnate. In this climate, will people want – or be able – to pay more council tax, even if it is to protect services for some of the most vulnerable people?

Here are the projected figures for what a 4.75 per cent rise would mean across the council tax bands:

band-increases*entitled to disabled relief
Figures provided by the Green Group of councillors

Will the citizens of Brighton & Hove bear these extra costs? Informal polling by the local newspaper, the Argus, says that most people are currently against the idea, but so far there have been no scientifically conducted polls that have asked the citizens of Brighton & Hove the question. Only a referendum could tell us for certain. One of the biggest problems with council tax is that its bands are based on 1 April 1991 levels of value, not what property is worth today, however council tax rises would still be progressive with those at the top paying more.

One alternative idea that some members of the Green Party have previously suggested is the ‘progressive council tax’. This would lower council tax for 80 per cent of the population while raising it for the top 20 per cent – which would probably be more popular! It is currently being looked at by a Green Party working group to see if it is even feasible.

3) The referendum might fail

A council tax rise would be a difficult vote to win at the best of times. In Brighton, however, people might also vote No in the referendum to spite the Greens because there is bitterness about some of their previous decisions. The bin strike, in particular, was a disaster for Jason Kitcat’s administration.

However, they have done many positive things in the city, such as erecting shelters for homeless people, building council houses, and expanding the living wage as well as bringing down the ratio between highest earners and lowest earners in the council to 10:1. For me, on balance, the Greens have been a force for good in the city, especially given the constraints they have to work with. The referendum, though, risks being seen as a referendum not just on the council tax rise but on the Green administration itself.

Pros

1) It would fund services for poor and vulnerable people

Most of us will become old, sick and/or vulnerable during our lives and may need to access similar services. If they are not there any more, not only the current people using them will suffer but many of us in the future will not be able to access them.

According to the Greens, a 4.75 per cent rise in council tax would raise £2.75 million in additional funds. This would go towards key adult social care services, including home care, residential community care, day services and supported employment for disabled people, as well as grants to the third sector.

Further details will be revealed on 13 February, and the devil may be in the detail. However, some unions that traditionally support Labour, such as the GMB and Unison, have already come out in support of the referendum. Mark Turner, the city’s GMB branch secretary, has said: ‘This new budget would protect frontline services in adult social care and a disabled workshop where we have members. Cuts would have absolutely terrible consequences on people’s lives. It is only right that the public have a chance to vote on this proposal.’

2) Referendums promote local debate and democracy

Referendums educate people, getting them to talk about current politics and think about policy. Already councillors have addressed a GMB branch meeting about the council budget, three public debates have been organised about the referendum (on 6 Feb, another on 6 Feb, and 10 Feb), a multitude of articles have been written about it and people across the city are discussing it. Actively engaging people in politics makes them more empowered, less apathetic and more able to appreciate the complexities of political decision making. And all this, as we’ve seen above, for only £1-2 a person!

The Scottish will have a chance to discuss and vote in a referendum on their independence on 18 September. Referendums are regularly held in Switzerland, where they recently decided to curb executive pay (although decided against introducing a cap of top salaries at 12 times that of a company’s lowest-paid worker). The Swiss will be voting in 2014 on the country’s procurement of Saab Gripen E fighter aircraft, amongst other things, and at some point are even set to debate and vote on a national basic or citizen’s income.

If the Scottish and Swiss can have referendums over such wide-ranging and important decisions, I am sure the citizens of Brighton & Hove could vote on a council tax rise.

3) It would send a message

A Yes vote would be a clear signal to the Tory-Liberal coalition that the citizens of Brighton & Hove do not agree with their policies.

The media coverage would be immense and could help shift the frame of debate around austerity economics and politics. It would have ripple effects around the country, and would likely encourage other councils to think about more daring strategies to oppose the cuts.

Final thoughts

Overall, I hope that the referendum goes ahead. It will give citizens a chance to debate and decide on the future direction of the city (for good or for bad). I am disappointed that the local Labour Party has till now opposed the referendum and not tried to find significant alternatives to austerity.

If the residents of Brighton & Hove do get to have a referendum, the way the question is phrased will really matter. People would vote very differently if they saw the following two questions:

a) Do you agree to the council tax rise of 4.5 per cent? OR

b) Do you agree to the council tax rise of 4.5 per cent to protect services for some of the most vulnerable in the city, which are facing cuts as a result of austerity imposed by the Conservative-Liberal Democrat coalition?

Also, the way this issue is reported in the media will make a big difference. The local newspaper, the Argus, is owned by Newsquest, which is in turn owned by Gannett Corporation – a giant multinational media corporation. There are many good journalists at the Argus, however they are under-staffed and under-funded and constrained by the structures which they work within. Not so long ago, workers at the Argus went on strike due to job losses.

These contraints drastically affect what issues are covered and how they are covered, and will affect how the proposed referendum is presented to the public. That is why, if nothing else, it is important we make ourselves aware of the facts.

The timeline

13 February: Budget policy & resources committee meeting. Final draft of budget proposals are published and agreed on at committee. It would require one or both of the opposition parties to support the referendum proposals, or abstain, for the decision to go to the budget meeting on 27 February.

27 February: Budget. Council budget for 2014-15 is set. Final decision on whether to freeze or increase council tax will be taken here by all councillors. If an increase above the referendum trigger threshold is set, a referendum would then be held in May.

22 May: Possible Referendum Date. If agreed at the budget meeting in February, this would be the date for a referendum on council tax – the same day as the European elections.

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First published on Mon, 2006-05-08

I’m not going to go into detail about the contents of Saturday’s Power Conference. For that, you can look at Davide Simonetti reporting/blogging it here.

What I will say is that I got the chance to ask David Cameron whether he supported participatory budgets. My question was more or less as follows: “Mr Cameron, one of the main things that I took from the Power Inquiry is the lack of power that I have as an individual over decisions that affect my life. What do you think about participatory budgets, like the one in Porto Alegre, where citizens have control over 17% over their local budget? There have been initial experiments in the UK with participatory budgets, such as in Harrow. Do you support these in the UK?”

In typical politician fashion, he did not directly answer my question. He did not address the idea of communities and individuals having control over a portion of the budget, or the idea of truly giving power to people. Instead, he talked about the fact that police commissioners should be elected and that visionary civic leaders are needed. Bastard! I should have shouted out that he didn’t answer my question, like other people did later when he didn’t answer their questions. Oh well, I’ve learnt my lesson there. Instead I sent him an email, although I doubt he will respond.

Apparently the event will be covered this week on BBC Parliament, so people out there will be lucky enough to see me ask my question (and David Cameron’s rubbish answer).

Exploring Active Citizenship

I have just finished reading a book which I picked up from the Power Conference which has gone straight onto my list of favourite books of all time: Beyond the Classroom – Exploring Active Citizenship in 11-16 Education which is edited by Benjamin Linsley and Elisabeth Rayment.
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First published on 2007-06-26 13:20

(The Fairtrade shop at Pentrehafod School is run by a student workers’ co-operative – Source: Times Educational Supplement)

At the recent co-operative congress, I went to a fringe meeting hosted by the UK Society for Co-operative Studies on ‘Where are the co-operators of the future to be found?’ Kevin McGrother (Young Co-operatives), Kirsty Palmer (Woodcraft Folk General Secretary), Mags Bradbury (Membership Diversity, Co-op Group) and Pam Walker (East of England Co-op Education Dept.) all spoke about their experiences in this field.

This was one of the most eye opening events of the Congress. I had not realised that co-operative educators had been teaching kids in schools across the country how to set up their own workers’ co-operatives. Kevin McGrother talked in detail how Young Co-operatives had been advocating the worker co-operative model in schools. They help small groups of young people to set up their own workers’ co-operatives to sell Fair Trade products. Apparently, they have been involved to some extent in around 350 schools.
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