#IPCC, energy and economic growth – are we brave enough?

updated 14 April, 2014.
Here is a quote from the new IPCC report on how to cut emissions. The summary can be found here: http://report.mitigation2014.org/spm/ipcc_wg3_ar5_summary-for-policymakers_approved.pdf
Globally, economic and population growth continue to be the most important drivers of increases in CO2 emissions from fossil fuel combustion. The contribution of population growth between 2000 and 2010 remained roughly identical to the previous three decades,while the contribution of economic growth has risen sharply (high confidence) [i.e. the scientific evidence for this statement is very good - SSM]. Between 2000 and 2010, both drivers outpaced emission reductions from improvements in energy intensity (Figure SPM.3). Increased use of coal relative to other energy sources has reversed the long‐standing trend of gradual decarbonization of the world’s energy supply. [1.3, 5.3, 7.2, 14.3, TS.2.2] ” 
It is very close to what we argued in our 2012 In Place of Growth.  We can do little about population growth here, other than supporting basic health and education worldwide, which means opposing the false economy of austerity:  we know that birth rates reduce when women especially have access to education and health care.  And it is economic growth that has accounted for the larger part of the increase – that is a doubling of emissions in the last 40 years.
And it is on the economic growth front that places like Manchester can make the greatest contribution. As the report again demonstrates, improvements in energy efficiency have not kept pace with the increased size of the economy and its associated emissions – and we argue they are unlikely to.
That means being very selective in which sectors of the economy are allowed to expand – we suggest local food and renewable energy production, and investment in highly energy efficient housing, for starters.  And it means actively shrinking those sectors that create big emissions – yes that’s you: aviation, private motoring, excessive meat and dairy farming, and the unnecessary consumption of goods imported from across the world.
That’s going to require brave straight talking and action from our leaders, from the Chamber of Commerce, New Economy, and the Greater Manchester Combined Authority,  and from academics and other pundits, journos, and so on.
Are we, and they, up to this challenge?

Mark Burton

In Place of Pay Inequality launched

Can campaigning around pay equity deliver significant improvements in economic, social and ecological justice? These were some of the questions explored when 30 people gathered on 2nd April 2014 to launch our latest report. The exciting energy present suggested that ‘momentum is building up on this issue’ and the information in the report could be valuable.

In Place of Pay Inequality: How Local Authority Pay Policies can help make  Greater Manchester more equal and sustainable, and why it matters, looks at the pay policies of local authorities in Greater Manchester to see what actions they had taken and makes a series of recommendations of what more could be done to reduce income inequality.

While many Authorities have implemented ‘living wage policies’ for their lowest paid employees some are below the Living Wage Foundation rate. Salford and Oldham are the only local authorities with policies which consider the pay and conditions of staff working for contractors who provide council services. Taxpayers currently subsidise low paying private providers of public services through benefits.  See table below.

Other local authorities in the UK have set targets to maintain or reduce the differentials in pay within their organisations. Greater Manchester, where 8 out of 10 Chief Executives are in the top 1% of earners in the UK is lagging behind best practice in this area.

 

A thoughtful moment: Ben Irvine with fellow SSM collective member Maurice Barnes

A thoughtful moment: Ben Irvine with fellow SSM collective member Maurice Barnes

The launch kicked off with brief and rich contributions from 5 speakers including Ben Irvine, the author of the report which was jointly produced with NW Equality. Among other things he pointed out that senior council officials have a responsibility for assuring social value and justice locally, and to receive an enormous salary for this was contradictory in itself. There was a vibrant discussion involving the participants of all ages who came as individuals as well as from Trade Unions, political parties, voluntary and campaigning organisations and included councillors from Blackburn with Darwen, Salford and Manchester.

So what was so special?

As Laura Banister explained, having a discussion about equity AND ecological justice that prioritises redistribution challenges the view that if there is ‘no growth, you are locking people into a miserable life’. Several participants illustrated how greater equity would be good for an economy which is good for people and the planet. We will develop this idea in further posts here. One of the ground-breaking qualities of the report is that it brings together Steady State principles alongside a stress on social value and equity.

Neil McInroy from the Centre for Local Economic Strategies, stimulated a passionate discussion by suggesting that while Local Authorities might be the ‘low hanging fruit’, the problem was bigger given the size of the economy outside their direct influence and that pay differentials are greater in the private sector. Others disagreed suggesting the public sector should give a moral lead, ‘local authorities still have tentacles which reach communities’ and the issue of outsourcing is key. However as Neil clarified, he didn’t mean to let councils off the hook – their local leadership role in ‘place shaping’ is vital to the wider problem.

Some participants with Neil McInroy and Tom Skinner (centre)

Some participants with Neil McInroy and Tom Skinner (centre)

Kevin Flanagan, SSM Friend Roger Bysouth and MACC's Mike Wild

Kevin Flanagan, SSM Friend Roger Bysouth and MACC’s Mike Wild

Laura Banister with Judith Emanuel who chaired the event

Laura Banister with Judith Emanuel who chaired the event

Tom Skinner contextualised this in the anti-egalitarian policies of the present central government, using the example of the regressive tax changes of the last budget that do nothing for people on low wages. If national government won’t act, then local government must. He noted the moves in Tameside and Manchester, but especially Salford which is an accredited Living Wage employer that is working on the procurement front, and Stockport that has got all its schools, and even the academies signed up. Paul Dennett, Assistant Mayor from Salford, confirmed the commitment from the mayoral team.

The breadth of related issues became increasingly evident. Kevin Flanagan from the GMB raised critical questions about ‘the battle for integrity of work itself’ and the need to integrate training, skill development and adult basic education into the demand for pay equity. Lydia Merryll of SERA and Pam Flynn asked where wage-less people wage fit in, including volunteers, those caring unpaid, mostly women and asylum seekers who cannot work and get £35 a week, unless they are destitute in which case they get nothing. How much could a citizen’s wage address some of these issues?

People listened to each other and valued each others’ perspectives: it was wonderful to hear Green and Labour party members commending each others’ actions!

Laura Bannister, who spoke on behalf of the Green Party, inspired others to action when she committed to write to the Chief Executives of the 10 local authorities, and the press, to ask what they will be doing to implement the findings of this report. Others present pledged to co-sign the letter and send it to Health and Housing Chiefs, AGMA and the press as well.

Tom Evans ,a councillor from Blackburn with Darwen will be asking questions in relation to grants given to industry, not only about how many jobs will result but also what kind and details about the hours and pay.

Mike Wild from Manchester Association for Community Care and Lydia Merrill will look further at aspects of social value and procurement.

Dick Venes encouraged us all to lobby on these issues during forthcoming elections.

One idea that gained wide support was Tom Skinner’s) Greater Manchester Living Wage Campaign) proposal of encouraging employers to get accredited for paying a living wage. Councils can facilitate this, thereby playing their economic ‘place leadership’ role beyond that of their immediate workforce and procurement footprint.

There was interest in a network on pay inequality which will need to complement and connect with the Greater Manchester Low Pay Campaign and Greater Manchester Poverty Commission. This might look at generating discussion with AGMA on what a good economy might look like, within which an emphasis on the connections between work and community has to be central.

Contact steadystatemanchester@gmail.com if you would like to know more and/or get involved in this area of our work.

pay multiples Table 1 IPOPI

Click for the report and a clearer view of the data.

By Judith Emanuel. Additional material by Mark Burton.

A diary date: In Place of Pay Inequality, 2 April (downloads here)

A date for you diary:  In Place of Pay Inequality –  Launch of our latest report.
Wednesday 2nd April 6-8pm, Collier Room, Methodist Central Hall, Oldham St, Manchester, M1 1JQ

8146474

In Place of Pay Inequality is a detailed study by Steady State Manchester and Equality NW into the pay policies of Local Authorities in the North West.
“It is rigorous, highlights important info well, well written and theoretically ground-breaking in terms of bringing together SSE, social value and equity issues.”
The report also explores,
- How public sector pay policies might play a leading role in making Manchester a more equal place.
- Ways to strengthen the accountability of Local Authorities for their pay policies and encourage them to implement stronger policies to reduce
pay inequality within their workforce and via their suppliers in the wider local economy.

Downloads  SUMMARY  FULL REPORT    FULL REPORT (larger font version)
free to download, but consider making a donation to our work.

At the launch there will be lots of opportunity for networking and discussion.
Speakers :
Ben Irving, author of the report
Tom Skinner, Coordinator, Greater Manchester Living Wage Campaign
Neil McInroy, Centre for Local Economic Strategies
Kevin Flanaghan or Paul McCarthy, GMB
Laura Bannister, Green Party

Everybody welcome, but please book a place via http://www.eventbrite.com/e/in-place-of-pay-inequality-tickets-10931828393

A more local economy

How do we shift the Manchester economy to one “where people can thrive without harming the planet”?  Not everyone yet accepts the idea that economic growth cannot go on forever, although they might understand that we are using more of the planet’s capacity than it can stand – ecological overshoot.  But they can often accept the wisdom of some of the key proposals in steady state thinking such as,

  • Reducing reliance on long, fragile, energy-intensive supply chains, especially for our food.
  • Focussing on the things we want the economy to deliver, rather than on the abstract and perverse measures of GDP and GVA.
  • Reducing reliance on imported energy.
  • Retaining and redistributing money locally
    -  Using wealth the city has accumulated to enable needed developments, for example in energy efficient and affordable housing.
    -  Reducing disparities between incomes.
    -  Reducing the leakage of money from the local economy.

These things will all contribute to local prosperity through creating more, decent jobs and will also make the real economy less vulnerable to shocks from a dysfunctional financial system, climate change, international conflicts, arbitrary austerity politics and the like.

So over recent months Steady State Manchester has been in dialogue with local politicians, especially in Manchester City Council to build consensus on this kind of thinking.  We differ from the dominant approach in that we don’t think that the pursuit of China-dependent, trophy-project led growth will provide us with a future that is ecologically, socially or economically viable.  But there is a lot we can agree on, and the above list is not controversial in itself, and it offers a kind of Plan B (or is that C?) for if…. when … the China wager fails.

Specifically, the report of the councillors’ sustainability working group (that came about following discussions on steady state economics in June 2012 and May 2013) was accepted by both Neighbourhood and Economy Overview and Scrutiny Committees this week.  It provides a framework for aligning economic, social and ecological strategy and recommends that this is done (via articulating what ‘good growth’ would look like) when the Manchester Community Strategy is revised, and that a similar approach is taken to monitoring and measurement of well-being in these three dimensions.  This all requires a profound culture change (as argued by MMU senior lecturer in philosophy, Mark Sinclair, this week).  Particular areas for development in healthy and local food, and renewable energy were identified.
The food agenda, tying together the need to address poverty, health, waste, security and resilience, and emissions has already been taken seriously through adoption of an integrated policy by full council.
At Finance Overview and Scrutiny we have initiated a process of inquiry into the scope for ensuring Manchester’s investments are best used for social, economic and environmental benefit, while meeting requirements for decent and sustainable returns.  An interesting discussion took place at this week’s meeting of the committee and it was agreed to include further consideration of this, inviting representatives of Greater Manchester Pension Fund (assets £10Bn), in the committee’s work plan.  Our brief paper in response to the report on ‘non treasury’ council investments is here.  Our view is that GMPF needs to revise its 2007 guidance on ethical investment, clarify what guidelines are given to its contracted fund managers, and building on its best practice, increase the proportion of assets invested in local economic development for the replacement economy, rather than in what (given the certainty of another crash in financial markets) are risky equities.  See also the previous discussion on the council’s own monies and its banking choices.

Finally, look out for our report and launch on pay inequality in Greater Manchester Local Authorities and the ways that councils can exert leverage for greater equality in their local economies.

Overview and Scrutiny Committees (Manchester Council) discuss issues raised by SSM this week

Yes, there are no less than three meetings this week where issues raised by or discussed with Steady State Manchester will be considered by Manchester City Council’s Overview and Scrutiny Committees.
1) On Wednesday 4th March, 2014, at  2pm, Neighbourhoods Scrutiny will take the report of the Environmental Sustainability Working group.  This work followed the discussions at Economy scrutiny on Steady State Economics and Climate Change in June 2012 and June 2013 respectively.
We are broadly happy with the report, having had a chance to contribute to both the discussions of the working group and the draft.  We didn’t expect this report to advocate the abandonment of the growth-centred strategy of the council and its city-region.  However it does acknowledge that not all growth is good, and recommends that the Community Strategy review what good growth would look like.  While our position remains that growth of the economy overall is not feasible – it is already in excess of our share of the capacity of the planet to deal with its consequences – we have been clear throughout that a re-balancing and re-localising of the economy will involve growth of some sectors (and reduction of others).

2)  On  Wednesday 5th March at 10.00 it is the turn of Economy Scrutiny Committee to consider the report.  This is the body that initiated this working group.  We think the important ‘take-away’ for this body is to agree that there is a necessary alignment between environmental, social and economic well-being.  This means that rather than seeing environment as a separate set of issues (and measures), it needs to be understood as integral (encompassing) the economic and social agendas.  For this reason we are pleased to see that the report recommends a more integrated approach to monitoring and measuring well-being – that might ultimately replace the flawed and distorting focus on GDP/GVA.

3)  Finally, on Thursday 6th March at 10.00, Finance Scrutiny meets.  On the agenda is the second part of the response to our letter of last September requesting an ethical review of the council’s investment strategy.  We are not happy with the report which is dismissive of the possibility of introducing ethical considerations into the management of investments where the council has a stake, especially the very large Greater Manchester Pension Fund.
This does not seem to consider recent thinking and research on the legal and moral responsibilities of fund trustees and managers and we will be putting this over in the discussion.

Helpfully, the details of all these (public) meetings and links to the papers, together with directions for finding them have been put together on the Mcr Climate Monthly website HERE.  Maybe we’ll see you there.

Meanwhile,here is the list of SSM recommendations to council from may, 2013  with our (subjective) assessment of what has been done by both the council and us.

Manchester Airport – the concrete shadow spreads – News – The Ecologist

Airport centric urban sprawl is metastasizing
overgreen space, locking in reliance

on fossil fuel intensive infrastructure.

Manchester Airport – the concrete shadow spreads – News – The Ecologist
CLICK TO READ FULL ARTICLE
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An excellent article in the Ecologist exposes the shortcomings of the ‘trophy project’ growth model that is, sadly, still the official policy here in Greater Manchester.

The new Manchester Airport Enterprise Zone is causing the piecemeal

This image, seemingly celebrating GHG emissions, actually appeared on a Manchester Airport Report.

This image, seemingly celebrating GHG emissions, actually appeared on a Manchester Airport Report.

environmental destruction of Green Belt countryside, reports Rose Bridger – all sacrificed to an archaic vision of fossil-powered economic growth.

A vast swathe of open countryside is being lost to construction projects to support the growth of air traffic at Manchester Airport.

The development of an Enterprise Zone, link road and 9,000-space car park is proceeding apace in the face of resistance from local communities.”  read more

A tale of two economies.

Or rather, this is about two economic discourses.
On Thursday I went to “The North West Economic Growth Summit” sponsored by Pannone solicitors, at the People’s History Museum in Manchester.  I was interested to hear the official, dominant narrative about the economy in the ‘city region’ and also to understand something of the spaces in those discussions and models where an alternative approach might gain a footing.
On Saturday I went to the first half day of the weekend event “Living the New Economy” at the Yard Theatre in Hulme’s ‘Homes for Change’ development.
Very different events of course, the first dominated (80%?) by (men and women in) suits, it’s key messages were as expected, especially in the presentations of Howard Bernstein, Chief Executive of Manchester City Council and Mike Emmerich of New Economy (this term gets confusing – used by these distinctly conventional thinkers as well as the critical and innovative new economics movement). So the unexamined ‘master’ assumptions were that Manchester (the word used in its broadest sense – at times seeming to encompass the entire North West!) needs to be competitive in the global economy, and that (endless) economic growth is obviously feasible, and is a ‘good thing’.  This led inexorably to the China obsession -getting a slice of the Chinese growth action.  There was also an advocacy of the city region as the appropriate scale to be working strategically (we almost agree – but insist that this should be the bioregion) and a palpable paternalism: almost the only mentions of Manchester’s population were in terms of ‘welfare dependency’ and skills. 
There was though an undercurrent, from some of the speakers (Alun Francis of Oldham College and Erik Bichard of Salford University) who presented a subtly different agenda – not entirely at odds with the dominant one but more communitarian and co-operative, more ecological, more nuanced in its understanding of population well-being and more creative economically (for example in Bichard’s points on measuring social return on investment and Francis’s points on the welfare debate needing to be not just being about money and the importance of non high level skills).
These undercurrents were also present among the audience, both in the (rather sparse) questions from the floor, and in conversations with a number of participants.  So people were questioning whether a ‘trickle-down’ model is relevant to those many parts of the conurbation with high levels of multiple deprivation and others were concerned about the large numbers of semi-skilled people in the mundane sectors that don’t have the glamour of the mega-projects like ‘airport city’ and ‘media city’.  There were even those who were sceptical about the HS2 project, although the need for rail infrastructure investment was accepted widely.
The ‘Living the New Economy’ event was very different with the emphasis on small scale initiatives: no suits there.  While much more in sympathy with the ideas and values being articulated, we really do need to look much more seriously at how to achieve the necessary scale for economic transformation.  Growing a bit of food here and generating a bit of hydro-power there just won’t make a difference in the scheme of things.  Likewise the alternative currencies being promoted do have a useful propagandist role but nowhere are challenging the dominant and disastrous money system.
We need to promote alternatives but make the links with the mainstream economically, socially, politically, and in terms of ideas and values while working at the appropriate scale and levering resources and commitment from the the mainstream for real change.  That is not easy, and there is little time.

Mark Burton

Why Manchester City Council Should be Banking on Something Better

Handelsbanken is a Swedish bank which runs a decentralised network of locally focussed banks where Branch Managers make decisions on whether or not to provide loans, in contrast to the 'computer says no' approach to local business lending of the big four banks that dominate the market. Along with Sustainability focused Triodos and Metro Bank, these 'Challenger' Banks have so far been excluded from providing banking services to Local Authorities despite their superior performance in supporting local economies.

Handelsbanken is a Swedish bank which runs a decentralised network of locally focussed banks where Branch Managers make decisions on whether or not to provide loans, in contrast to the ‘computer says no’ approach to local business lending of the big four banks that dominate the market. Along with Sustainability focused Triodos and Metro Bank, these ‘Challenger’ Banks have so far been excluded from providing banking services to Local Authorities despite their superior performance in supporting local economies.

Part of the transition to a steady state economy requires maximizing the opportunities for local economies to invest in themselves, specifically in socially useful, equitable and resilience building enterprises. SSM also believes Local Government will play a key role in building many aspects of a truly sustainable local/regional economy. To this end, as part of our ongoing engagement with Manchester City Council, we recently requested Finance Scrutiny Committee to do an ethical audit of the Council’s investment’s, both to question what investment’s might be identified as detrimental to social and ecological well-being, but also to explore options to increase the returns from public investments by directing them towards the creation of social and ecological value in the local economy.

A preliminary report was presented to the committee yesterday detailing the Council’s short term investment’s and banking provider, with a further report on the Greater Manchester Pension Fund to follow. The Council’s banking contract and short term investments are only of interest to banking type organisations as they assist with liquidity, with greater scope for direct long term investment in social and ecological value creation residing with the Pension Fund and other longer term investments. However with UK council banking contracts totalling £30 billion, where Council’s bank has the potential to significantly influence the character of the financial sector for the better and direct investment to more socially useful areas.

The Move Your Money campaign has been doing a lot of work on this, encouraging Local Authorities to move their banking and investments to organization’s which lend more to the real economy and produce more social value.

There are significant barriers, as reported here, council risk aversion, coupled with CIPFA and DCLG guidance and the Council’s use of the advice of private ‘Treasury Management Advisors’, favours the 4 ‘too big to fail’ banks which consistently fail to hit SME lending targets.

Challenger banks such as Triodos, Metro bank and Handelsbanken do not have formal credit risk ratings and Treasury Management Advisors currently refuse to put them on approved lists to receive council deposits.

The report of the Parliamentary Commission on Banking Standards called for a review of DCLG guidance which by advising Councils to only deposit with banks with high formal credit ratings, puts smaller banks at a competitive disadvantage despite government commitments to encourage new entrants in the banking market.

MYM have been campaigning for changes with these regulatory bodies but they also stress that Local Authorities were granted ‘powers of competence’ to manage their financial affairs by the Localism Act in 2011, and that DCLG, CIPFA and Treasury Managment Advice is only advice. It need not prevent Councils from including other considerations in it’s final investment decisions. All of this was presented to Committee members yesterday by SSM. Councillors were also provided with the Local Authority Toolkit published by MYM, a comprehensive guide to what Local Authorities can do to get more social value from their investments.

The Council will be tendering for a new banking contract shortly, following The ‘Co-operative’ Bank’s withdrawal from providing banking services to Local Government. It will require real commitment and genuine buy in from residents, councillors and council officer’s to prevent public funds leaking out of Manchester through a ‘too-big-to-fail’ bank and ensure they are re-invested locally in the real basis of future prosperity for the region. The returns however are genuine, worthwhile and lasting; local prosperity and the rebuilding of a fairer banking system.

If you are interested in getting involved in this campaign get in touch with SSM by emailing: steadystatemanchester@gmail.com