Motion #01
This is Draft Voting Paper for the Economy Chapter actioning the Enabling Motion which passed in Spring 2022. It is still a work in progress but is mostly complete bar a few small sections. It is currently much longer than hoped, but editing to tighten up and ensure consistency is still in progress. Background Paper is available.
The New Economy Chapter focuses on policies to allow our society to response sufficiently to the current predicument. This includes both climate and biodiversity emergency as well as social, health and well-being challenges. It makes clear that the limits to our economy at any given time are Skills, Labour, Energy, Materials, Infrastructure and industrial capacity. That said, planetary boundaries present externally define thresholds which our society must choose to limit its economy to fit within its fair share of. To achieve this, the chapter lays out and cross references to other chapters to highlight a broad range of required policy changes encompassing governance, regulation of economic activity, taxation and monetary policy.
The key changes compared to existing policy are:
Delete all of existing Economy Chapter and replace it with the following text up until “End of Economy Chapter”:
EC001 Our Economy is all the activity in our society which relate to production, exchange and consumption. EC002 What matters is whether economic activity contributes to wellbeing of our society or undermines it’s long term viability. This is regardless of whether an economic activity is quantified in financial terms or whether it is ‘formal’ rather than ad-hoc.
EC003 All human economic activity and social and cultural wellbeing are dependent on the integrity and selfsustaining, self-managing natural systems. Continually increasing resource extraction, industrial throughput and waste production is entirely incompatible with ecological sustainability.
EC002 The industrialised countries must actively reduce the physical burden they place on the planet and must, by example, encourage and support the less industrialised countries in adopting development strategies.
EC004 Our current predicament involves our economy failing to deliver basic needs, meaningful livelihoods and wellbeing for everybody, as well as crossing a myriad of planetary boundaries. Such boundaries include climate change and biodiversity loss, which warrant very urgent action to avoid irreversible and extremely profound consequences. To prevent unnecessary suffering and allow future generations equivalent opportunities to thrive as current generations, an emergency response resulting in a period of disruptive change is unfortunately necessary (PB301).
EC005 Contrary to myth, the UK Government is not like a household that must balance its budget. This is because it can create pounds sterling and cannot become bankrupt. The real limits to money creation are the broader limits to our economic capacity: labour, skills, energy, materials, infrastructure/machinery. Money is a tool for directing these resources to deliver public goods. To quote John Maynard Keynes “Anything we can actually do, we can afford”. Regulating tax and spending to respect real resource limits will prevent rising inflation without the need for arbitrary fiscal rules.
EC101 Our Economy must deliver all of the following: Ecological sustainability Wellbeing for all Equity and social justice Community agency through democracy Self-reliance with interdependence
EC102 There are inherent tensions between the pursuit of all these objectives together. Prioritising some in the short term at the expenses of others can, in some cases, make re-addressing the balance much harder, if not impossible, in the longer term. Therefore economic policies should resist the temptation to leave delivering of some aims to future governments. Our democracy must acknowledge and confront the difficult trade-offs, tensions and compromises inherent in these aims.
Principles for guiding economic decision making in pursuit of the above aims.
EC201 Human economic activities must observe these boundaries if we do not wish to make the planet inhospitable for humankind. Economy policy must therefore be fashioned in the context of both finite and dynamic planetary boundaries.
EC202 All economic activities have impacts and our economic systems must provide accurate information on these impacts to allow for informed business decisions.
EC203 Current levels of material and energy consumption in the UK and most of Europe are clearly unsustainable and must be rapidly reduced.
EC204 Therefore a sufficiency approach where wellbeing for all is the first priority for economic capacity should be pursued.
EC211 We as UK Citizens share the planet with the rest of humanity and all of humanity must benefit equitably from what economic activity our planetary boundaries allow.
EC212 There is a need to address existing and historic economic structures that allow benefits of human economic activity to accrue disproportionately to industrialised countries as this imbalance is both unfair and unsustainable.
EC213 The UK should undertake global public investments to support the wellbeing of all, globally, into the future.
EC231 Ecological sustainability is compatible only with much reduced consumption. To ensure universal acceptance, and in the interests of fairness, the benefits of economic activity must be shared equally.
EC232 Therefore business models should be focused on the delivery of good or services that support people’s wellbeing and not on the extracting of rent from ownership of scarce assets.
EC241 Economic power should be devolved to the lowest most appropriate level for a given activity and context.
EC242 Increased community self-reliance, through prioritising local economies and provisioning, will allow reduction in international trade and increase regional resilience.
EC251 The public must exercise ultimate economic power and elected government must play a leading role in shaping our economy.
EC252 Every individual, company, and government body has some level of influence over the shape and nature of our economy. Transparency over which actors have more than average influence and how they use that influence is critical for democracy.
EC253 The UK’s current systems of governance and democracy are not fit for purpose to deliver.
EC254 Information flows must support informed decisions by being accurate and inclusive (in ways that the market price mechanism cannot capture) and be characterised by transparency. EC255 Global problems require global cooperation.
EC256 The precautionary principle should be applied where the impacts of activity or potential activity present unknown but potentially very severe danger for wellbeing compared to that activity not happening.
EC257 Our Economy is a complex dynamic system which is linked to multiple other economies as well as earth systems, so it needs to be managed in a joined up, coordinated way.
EC258 The use of mass behaviour manipulation (e.g. through advertising) for private purposes must be restricted.
EC261 Economic policy is the servant of political objectives.
EC262 Economic policy should promote sustainability and fairness.
EC263 There should be a presumption in favour of collective provision of public goods, especially in respect of “natural” monopolies.
EC271 Taxes and Taxation as a whole should be:
EC281 International trade should be reduced alongside a shift from globalisation to localisation
EC282 The resolution of global economic and ecological crises requires a new order of cooperation between nations with the development of new international institutions and agreements.
EC301 In large complex soceities the collection of data is critical to faciliate effective and accountable governance. To a large extend to get measured is what gets done, but it is important to recognise that assigning targets to metrics creates political incentives to over or under report (see Transparency & Accountability Section below). It is also critical to acknowledge that not everything that matters can be practically measured. What the public will and won’t accept without civil unrest or widespread non-complience is critical to governence, but often difficalt to measure proximity to objectively.
EC302 Our Society already collects does a lot of measurement, but in may ways fails to collate useful data on some of the most important issues whilst being fixated on single measures of economic activity (e.g. GDP - Gross Domestic Product) as indicators of progress, dispite their flaws. Instead out soceity should acknowledge he complexity of our economic objectives (See EC101), and adopt a dashboard of indicators. This must cover both indicators of our soceities Ecological Impacts (see EC321-322) and Wellbeing indicators (see EC311-314) as well as indicators of use and utilisation of the physical constrains to our economy. These include:
EC303 It is critical in determining useful indicators to accept that there are limitations to what can and can’t be usefully assigned a monetary value, and cultral implications of doing so (See MC201). There are also practical limits to what can be effectively measured monthly or annually. Our soceity must take the long view and work towards goals whether progress might not become clearly within a parlimentary term.
EC311 Adequate (perhaps a minimum standard) provision of the following: water, food, health, education, income and work, peace and justice, political voice, social equity, gender equality, housing, networks and energy tend to indicate well-being.
EC312 The well-being of individuals, communities and ultimately the whole world depends on an adequate provision of some or all of the above, depending on the culture and condition of the countries and societies to which they apply.
EC313 The official definition of well-being is ‘the experience of health, happiness and prosperity. It includes having good mental health, high life satisfaction, a sense of meaning or purpose, and the ability to manage stress.’
EC314 The following indicators of well-being should be considered: connect, be active, take notice, keep learning and give.
EC321 Planetary Boundaries are not external constraints, only boundaries that globally humanity can choose whether to cross. There is as a result a global collaboration and fair sharing aspect to determine the boundaries each nation must choose to say within. If our soceities uses up more of the global ecological space, then other soceities must use less for planetary boundary not to be exceeded.
Biosphere Integrity: (See RR1000-1006)
EC323 Policies for a Sustainable Society as a whole is a response to this, but the governance for our economy in particular is critical for England and Wales to make it’s contribution to saying within these boundaries. To do this the following will be necessary:
EC401 Ensuring effective and appropriate economic governance and accountability systems are in place is critical to maintaining a functioning democracy, let alone delivering the economic objectives set out in EC101. The purpose of these systems and the public administration structures that support them is to steer economic activities in an environmentally sustainable and socially just direction, while minimising imbalances in economic power and their associated corruption, misappropriation and regulatory capture. See PA101-3.
EC402 Our Government is responsible for:
EC403 All levels of government share responsibility for economic governance. Subsidiarity, decentralisation, direct participation and greater freedom of information will radically transform democratic processes (PA101-07, PA912) and lead to greater localisation of economic activity (EC241-2). This will allow closer accountability at multiple levels of economic decision making. Delivering this isn’t just about bringing economic decision making into public sector, it’s also about re-defining the private sector roles to give workers and wider stakeholders a wider role in independent economic activity.
EC411 Economic Accountability require not just the publishing of plans and discussions and the collating of additional statistics, but funding the scrutiny of the published information (PA202-3, PA857). Effective participation in economic decision making is time consuming and can be facilitated through funding of broad range of independent scrutiny mechanism:
EC412 Therefore the state should make provision for the following through independent agencies and commissions:
EC422 The central government exclusively has responsibilities which constrain local and regional government:
EC423 All national and subnational governments are responsible for:
EC424 The power to deliver services will reside with Local Government unless Local Authorities agree to pool resources and delegate delivery upwards to a Regional Authority.
EC425 All levels of government will then collaborate under the principle of subsidiarity (EC241) to determine Strategies and plans to deliver Economic objectives (EC200). See EC4## below.
EC426 All tiers of government are empowered to use taxation and subsidies as financial policy levers to shape economy and deliver changes to daily practices, business practice and systems of provision. However national and subnational governments are not permitted to use local taxation primarily as a revenue raising mechanism so their taxation and expenditure on subsidy policy levers must balance each other.
EC427 All national and subnational governments can request central government funding for either essential or additional projects/services along with details of employees, skills, energy, material and infrastructure implications. Central government must approves these request providing that: they are for activities within that authorities scope they haven’t already been funded The authorities is meeting or has a sufficient plan to meet it’s targets/budget (EC4##, EC800) and minimum social foundation The authorities is compiling with all other UK law Due democratic process and transparency is being followed
EC428 Central government reserve the right to withhold payment on approved funding for particular activities or resource needs when necessary to manage inflation or manage resource limits (EC504, EC10##). Where payment are scaled by must be done so proportionally across all equivalent request from all authorities. In these circumstance central government has to make a political decision as to how to balance resource demand between central government, national and subnational government, and private sector demand.
EC431 Our economy is a dynamic complex system with millions of participants. It is interdependent with ecosystems and wider earth systems which are also dynamic complex systems that humanity doesn’t fully understand and shouldn’t assume it can control (PB204-5). Therefore economic management has to acknowledge that not all outcomes can be predicted and untended consequences are likely. This means taking a strategic and adaptive approach to both planning (EC4##) and Managing Necessary Economy Disruption (EC001, EC10##).
EC432 Strategic planning will need to be heretical to ensure decision are made at lowest most practical level with greatest accountability. This means tiers of strategies (e.g. Jobs Strategy - IN302) plans (e.g. Land Use plans - LD501) and budgets/targets (e.g. carbon budgets - CC###) at UK, national, regional and local levels. Each tiers will set constraints necessary and determine aspect of planning required at that level and pass remaining detail to be determined at lower levels. The duty to cooperate and each tier having authority over splitting up allocations between authorities on tier below will all UK level targets and budgets to be delivered even if delivery detail is determined locally.
EC433 UK wide Economic Strategy (IN401-3)) must coordinate the follow strategies outline in other Chapter of Policies for a Sustainable Society:
Industrial Strategy (IN209, IN409)
EC441 Economic power to the lowest appropriate level and the formal economy should not be prefered to the informal economy. Human scale decision making, whether through collective ownership structures of business or through derivative processes to shape public decision making will give communities much great control of our economy (Core Value 7, PA100-7, PA912).
EC501 To deliver the economic objectives set out in EC101 it is crucial that a proportion of economic resources are allocated for public goods and ensuring well-being for all. Taxation policy (EC###) determines how these resources are collected, and overall must ensure that contributions are fairly collected based on ability to pay. This not only helps correct the inequitable drift of the last decades, but also adjusts distribution of wealth and opportunity without our economy. In order to effect the reduced consumption of physical resources which must accompany the shift to living within ecological limits, there is a need to ensure everyone has access to sufficient resources to support their wellbeing before others can accrue significant luxuries. This applies within communities, across the UK, and globally.
EC502 Globally, redistribution will take the form of global public investment (IP224, 226), including debt relief (IP230), and especially measures to address the UK’s historic contribution to a situation where those most at risk from the climate emergency are those who have done least to cause it (CC014).
EC503 Inequalities between different areas of the UK will require a redistribution of wealth and resources between districts and regions in order to ensure that public services can be fairly and adequately paid for across the whole country. This redistribution should be overseen by a commission, independent of central government (PA403, LD301), and should take account of criteria such as net migration, poverty and social deprivation, industrial base, natural resources, and environmental damage, as well as the capacity of a local or regional authority to raise its own funds.
EC504 A strategic and adaptive approach to resource allocation will be necessary as our economy is bound physical limitation including: availability of labour, skills, energy, materials, machinery and infrastructure capacity. This limits often apply regionally rather than just for UK as a whole. Some of the constraints can be overcome over time through strategic interventions such as Industrial Strategy and Jobs Strategy (see EC4##) or infrastructure investment (see IN500). When there are difficault decision to be made these priorities should be considered:
EC505 Across and within the UK, collective provisioning and resource distribution will be delivered through:
a) provision of public services (EC###)
b) price controls (e.g. H401b)
c) subsidies (e.g. TR102) and removal of existing subsidies (TR541)
d) taxation of wealth (EC###)
e) taxation of personal income(EC###)
f) taxation of material and energy consumption(EC###)
g) taxation of pollution and goods/services harmful to public and associated public dividends(EC###)
h) Taxation of Business Profits/surpluses or the distribution of them (EC###)
i) Citizen’s Income and Citizen’s Pension(EC### and EC###)
EC505 Of the mechanisms outlined in EC##4 the most significant will be the provision of public services (a), Citizen’s Income and Citizen’s Pension (I) as collective goods using revenue generated by taxations (d-h). Overall taxation should be progressive in the sense that those with greater means, make a proportionally bigger contribution to funding of collective goods.
EC506 It is critical to create a safety net for all (see Delivering Social Foundation Section) and for society to embrace the risk of supporting new ideas and scaling up of business in uncertain times. This entails generous funding for community/local/regional/public banks etc., to create as many opportunities as possible for new low-carbon local business to meet local needs, since other approaches can be surprisingly high-carbon. Without opportunities there cannot be hope, and disruption will feel like pain rather than flux.
EC1000 The term intellectual property covers a number of different areas, such as cultural products (see EC1011 below), software, physical inventions, drugs and natural entities protected by different means such as copyright, patents and trademarks. There are differences within and between these areas, and there can be no single intellectual property policy. The crucial balance in policy is between ensuring that there is adequate funding and incentive for innovation for socially and environmentally valuable activity and encouraging the widest possible sharing of these rights, which are public goods.
EC1010 Our general presumption is to encourage the Green value of greater sharing and to make it more difficult to obtain patents and similar forms of protection than at present. Specific policies are below.
EC1011 On cultural products (literature, music, film, paintings etc), our general policy is to expand the area of cultural activity, that is ways that culture can be consumed, produced, and shared, reduce the role of the market and encourage smaller and more local cultural enterprise (see CMS200 onwards). Specifically we will introduce Universal Basic Income (see EC730), which will allow many more people to participate in cultural creation; legalise peer to peer copying where it is not done as a business; liberalise ‘fair use’ policies to operate outside the academic environment, and allow greater development from existing copyright material; and make it impossible to patent broad software and cultural ideas.
EC1012 So far as concepts embodied in physical objects are concerned, we would generally shorten patent terms and relate them to the timescale of innovation in the industry concerned. We believe too that specific measures are needed to spread already patented ideas needed by many people who may not be able to afford them and to promote research in socially useful areas where the poverty of the potential customers makes rewards unlikely (eg drugs for tropical diseases): in the long term we would promote international funding to buy out the owners of certain patents, based entirely on global social and environmental usefulness, with the patent becoming available to all once the payment had been made; in the absence of such an international regime, we would enable the government effectively to nationalise a patent where it was in the public interest to do so. Such a patent would be publicly available and the creators of the patent compensated; we would fund a programme of government research in socially and environmentally useful areas where the prospect of inadequate rewards is inhibiting research activity.
EC1013 We would encourage and make easier the voluntary use of the open source model, not just for software.
EC1014 All published material created in the public sector (eg maps, government publications, university research) would be available to all free of financial restrictions, distributed in open standard formats, and Crown Copyright would cease to exist.
EC1015 We would impose a national ban and seek an international ban on the patenting of living material (see ST360, AR410).
EC1016 As part of the proposed dissolution and replacement of the WTO (see IP122), the GP would seek to abolish the TRIPS Agreement and transform WIPO into a body that would help poor countries to acquire the knowledge required to develop on an ecologically sustainable basis. The requirements of the Convention on Bio?diversity must take precedence over trade rules for all aspects of IP that are ecologically sensitive, including seeds, genes and other life forms.
EC1017 We would restrict the value of claims for intellectual property violations to a proportion of the monetary gain made by the commercial exploitation by the user, and not allow damages.
EC601 Business needs to operate in the interests of the majority in society and in a way which is environmentally responsible. A combination of policies will encourage this shift and will address the concentration of unaccountable economic power.
EC602 The right of the shareholders to dividends must not be the single most important criterion for company policy making.
EC603 The Companies Act 2006 (section 172) will be amended such that directors of a company must prioritise the well-being of all living entities (including all nations, all species and future generations, as well as all people alive today) and avoid negative environmental and social consequences. This means that companies will need to invest profits in a just transition of their company before distributing dividends to shareholders. Companies will also be required to include a clear purpose in their Articles of Association aligned with this change to the Companies Act.
EC604 Those with a stake in the company’s decisions must have the right to make informed input into those decisions. These stakeholders will be named in company documents. These ‘stakeholders’ include the shareholders, the workers, the local community (where appropriate) and advocates for the environment. New legal and institutional structures will be created to enable these stakeholders to have a voice in the running of companies and other relevant organisations. Companies must publicly disclose ultimate beneficial owners with significant control.
EC605 Large businesses will be subject to increased controls and requirements as a means of discouraging inordinate size and to link power with responsibility. This will include increased transparency and reporting requirements.
EC606 The Competition and Markets Authority (CMA) will be encouraged to fully use its powers to shift the business sector away from monopolies and oligopolies and to ensure fair competition. This will involve greater controls on mergers and the active deconcentration of existing monopolies.
EC607 Economic policy levers such as taxation will be used to discourage monopolies and to redistribute monopoly profits, for example the use of variable rates of corporation tax.
EC608 Economic incentives will be used to encourage the co-operative model of business ownership. Such businesses remain bound by the Companies Act. In line with WR633-639, the conversion to co-operatives will also be made simpler and will be encouraged by government policy. In line with WR610, employees will have the legal right to buy out their companies and turn them into workers’ co-operatives. Buyouts would be funded by the Green National Investment Bank (Check this is still in our monetary policy or different name?). In line with WR642, the government may, under certain circumstances, use the ‘golden share’ approach to restore businesses to worker control.
EC609 Independent social and environmental audits will be mandatory for all medium and large companies. Action on improving standards will also be mandatory so that the emphasis shifts from reporting to acting. In line with IN627, triple bottom line reporting will be mandatory and links with ECxxx (currently EC652) on business purpose.
EC610 All companies will be required to pay a living wage and to offer contracts with proper provisions and protections. The maximum permitted pay ratio will be 10:1 (see xxxx (need to find correct x-ref)).
EC611 No individual or company will be permitted to rely on devices such as limited liability to evade the costs of environmental damage caused by their economic activities.
EC612 Businesses will be subject to tighter regulation around marketing and advertising. This is in the interests of maintaining the ability of individuals to make decisions free of commercial manipulation. In some instances, products themselves will be subject to restrictions or bans in the interests both of individuals themselves and wider society which includes the rights of future generations to a liveable planet.
EC6#1 The banking system is a critical to our economy and should be largely brought under democratic control to ensure it is run in the interests of the common good. The follow policies are steps towards that aim:
EC6#2 A publicly owned Bank to provide current accounts, payment systems, and other retail banking services for all UK citizens will be established. Local branch services will be delivered in partnership with existing community-based finance providers (such as Credit Unions, Building Societies and Community Savings Banks) and post offices.
EC6#3 A network of local and regional Community Banks (incorporating existing not-for-profit bodies such as Community Development Financial Institutions) will be established to provide funding to small and medium businesses to further the creation of self-reliant, zero-carbon and resilient local and regional economies.
EC6#4 Private retail and investment banking will be separated, such that a company (and its subsidiaries) may carry out one but not both activities. Limits will be set on the size of private banks, measured in terms of market share, and an approved list of permitted banking activities will be introduced. Investment banking will not be allowed to benefit from limited liability. All financial institutions will be required to observe a fiduciary duty towards their clients, which can only be varied for specific ethical reasons agreed with a client.
EC6#5 National Savings and Investments’ (NS&I) Green Savings Bonds will be actively promoted as an opportunity for people to invest in our future.
EC6#1 …
EC701 Definition: Wellbeing is a state of being healthy, happy and comfortable both physically and mentally.
EC702 Wellbeing can only come about for the individual if the state, where necessary, is capable of providing the basics of life. They include the following items which go to make up the Social Foundation: sufficient food, clean water and decent sanitation; access to energy and clean cooking facilities; access to education and to healthcare; decent housing; a minimum income and decent work; access to public transport; and access to networks of information and to networks of social support. Additional elements which need to be considered are gender equality, social equity, political voice, and peace and justice. See the United Nations’ sustainable development goals which it is hoped will be achieved by 2030.
EC7#1 The provision of public services is key for limiting inequality, meeting basic human needs, and distributing surpluses. See Universal Public Services below (EC###). The principle of universal access to essential services, either free at the point of delivery or at below market price, will be retained and, to keep pace with changes in society, extended, e.g, to communications technologies (CM672) and social care (SW609).
EC7#2 Whilst there should be scope for regional and local governments to enhance and diversify public service provision within their jurisdiction (PA111, PA380-6, PA400-4, PA413-4, PA500-3), universal access to, at minimum, the following public services should be guaranteed across England and Wales:
EC7#1 Every citizen would receive an unconditional Citizen’s Income or Citizen’s Pension to secure their basic social security (see EC730–733 below). Citizen’s Income is an unconditional, non-withdrawable income payable free of tax to each individual as a right of legal residence in the UK. It will not be subject to means testing and there will be no requirement to be either working or actively seeking work. A reduced amount will be payable for each child to a parent or legal guardian. People with disabilities or special needs, and single parents, will receive a supplement.
EC7#3 Universal Basic Income sufficient to cover an individual’s basic needs will be introduced. Universal Basic Income is an unconditional, non-withdrawable income payable to each individual as a right of legal residence in the UK. It will not be subject to means testing and there will be no requirement to be either working or actively seeking work.
EC7#4 Universal Basic Income will eliminate the unemployment and poverty traps, as well as acting as a safety net to enable people to choose their own types and patterns of work (See EC400). Universal Basic Income will thus enable the welfare state to develop towards a welfare community, engaging people in personally satisfying and socially useful work.
EC7#5 Children will be entitled to a reduced amount which will be payable to a parent or legal guardian. People with disabilities or special needs, and single parents will receive a supplement.
EC7#6 Initially, the housing benefit system will remain in place alongside Universal Basic Income (see HO600-02) and will also cover contributions towards mortgage repayments for people in those situations previously covered by the Support for Mortgage Interest scheme. This will subsequently be reviewed to establish how housing benefit could be incorporated into Universal Basic Income.
EC7#7 We appreciate that introducing Universal Basic Income as a sudden single change is probably not feasible. Instead we would propose to gradually introduce its main features into the existing social security system, beginning with removing conditionality, reducing the number and complexity of payments, and reducing withdrawal rates.
EC7#8 Consolidated Income Tax Personal allowances could be adjusted and perhaps eventually removed to take account of the introduction of Universal Basic Income. See: RR709, SW200, SW402, SW905, HO600
EC7#1 This section need writing…
EC7#1 …
EC7#1. It is therefore necessary to introduce publicly administered pension schemes which will enable people voluntarily to provide for their retirement without recourse to the current private pension providers. People will be able to contribute to a national additional scheme in which they will get fixed rate pension investment bonds in return for their contributions. They will also be able to invest in Local Community Pension Schemes, which would be administered by local authorities/community banks and would re-invest the money paid into them within the local community. These could offer the options of either fixed rate local bonds, or an equity-based scheme which would give variable returns from investment in appropriate local businesses which satisfied various criteria concerning environmental and social standards. Those who have contributed to such publicly administered pension schemes should receive an annual statement detailing the current value of their pension fund, and an estimate of the future level of an annuity purchased by that fund on retirement.
EC7#2. Stakeholder pension legislation will be amended so that employers need only offer entry into such publicly administered schemes. There will no longer be any tax relief for contributions to additional pension schemes, whether privately or publicly administered. It would still be possible to use the accumulated pension fund to buy an annuity, but no longer compulsory to do so. A publicly run annuity scheme would be set up to offer a secure alternative to those which are privately run. Income received from annuities, whether public or private, would no longer be taxed on receipt.
EC8#1 Management of our economy is a central enabler of a transition to a society which thrives within planetary boundaries and is based on key principles EC201-203 and CC120. This management takes several forms: public expenditure to manage the transition to a lower energy society use of levers including taxation and regulation to change behaviour and social practice change the purpose of institutions such as banks and businesses a shift away from globalisation and international trade towards more localisation support global action towards a liveable planet for all drive a narrative for our Economy which shifts public understanding and expectations
EC8#2 Public expenditure will be directed towards change in the following key areas: investment in a clean energy system (see Energy chapter) investment in public transport and active travel infrastructure (See Transport chapter) retrofit of buildings to increase energy efficiency and to shift to clean electricity (CC130, EN020, EN021) changes to land use (see Land Use, Forestry, Wildlife and Habitats chapters and CC141) a shift from intensive to regenerative agriculture (see Food and Agriculture, Wildlife and Habitats chapters) investment in R&D for new technologies (see CC160, CC170, EN051, EN081, ST211, NR427) reskilling the workforce for the transition (EC610, EN060) EC8#3 Investment will be reduced in areas which are unhelpful to staying within planetary boundaries (see chapters on Transport, Local Planning and the Built Environment, Housing, Peace, Security and Defence).
EC8#3 Levers to drive behavioural and social change range from taxation through to regulation prohibiting damaging activities. The balance of these will shift according to the evolving nature of the planetary crises and the urgency of action.
Carbon Tax (EC777, CC121, EN080)
Green/eco taxes, carbon border tariffs, import duties (EC776, IN405, EC779)
Land Value Tax (IN408, EC???)
Natural Resource Tax (NR423)
Locally applied taxes (EC791)
On products that are zero carbon and zero waste (IN406, EC771) On improving energy and water efficiency to homes (HO405)
EC8#4 The purpose of institutions will be aligned to staying within safe planetary boundaries.
EC8#5 Localisation will be supported by policies in the section: Local and Regional Policy
EC8#6 Global action will be supported by policies in the section: International Interactions – Pink Book
EC8#7 Alongside our economic policies themselves, the language we use to communicate economic policy will gradually shift the public and media understanding and expectations. See Context, Objectives of our Economy, Principles and What Should We Measure.
EC911 The UK should strive to build common global structures and alliances to deliver a safer, just and environmentally stable international system (PDG) at the same time as aiming develop a UK economy that is self-reliant, meetings it’s international obligations and secure.
EC921 A Green government will encourage trading of resources between countries to deliver just outcomes and to fight the climate and biodiversity emergency. This will include increased cross border electricity transfer (EN011) and cooperation in managing waste flows (PL400).
EC922 As part of these a green government will work towards a trading system that does not shift our problems aboard (CY510, EU450), though dangerous disposal of waste (PL400 NR431), exporting carbon emissions(EN112) or depend on exploitation (IP235) and environmental destruction (CC150).
EC923 Governments, or firms trading with the UK will need to respect human and environmental rights (EU101,IN616,IN617) and trade agreements should support countries sustainable development (PP112, I233). Specifically this should respect the rights of indigenous peoples (N431).
EC924 Specifically, the UK government will withdraw from the current energy treaty and IDSS arrangements.
EC925 To ensure safe and sustainable products the UK will work with other countries towards common standards ensuring products imported into the UK meet the same standards as those produced in the UK.
EC926 The UK should work with other countries to establish carbon border taxes to prevent carbon leakage. (EN110) EC927 Part of UK’s global public investment should be in infrastructure for appropriate levels of low carbon trade including rail and shipping. Freeports and Special Economic Zones (SEZs) will be abolished as well as other trade related tax exemptions in line with EC271.
EC931 With some economic activities the UK should aim predominantly for self-reliance and security. These include:
EC933 To meet social objectives we will end the export and import of certain products that do not perform a useful function in the global system these include: animals for slaughter (Ar404, Ar408), Foie gras(Ar413), fur, Ar1414, race horses (Ar28) and any tradable good from international wildness areas such as Antarctica (N4431).
EC934 There are also various activities that we would encourage, such as: sustainable travel and tourism (Ht021), educational goods, health information and conservation
EC935 Greens support local governance and this can mean local control of business this includes: community right to buy, measures by local communities to control their local high street and particular measures to support local businesses or cooperatives.
EC941 International trade requires cross governmental cooperation to ensure regulation. The power governing international trade should rest with governments and society and not with transnational corporations. EC942 All corporations should respect human rights and the natural persons controlling them should be accountable for their actions wherever they take place in the world and aim for sustainable outcomes alongside shareholder profit(See the reform to the companies motion that is not yet policy)
EC943 International regulation should prevent transfer pricing (IN616) and ensure minimum taxation on corporate profits (Tax policy passed at conference but not on the website as far as I can see but also EU445) this should be captured by the countries where firms are operating (IP235).
EC944 UK should work towards common global arrangements and standards on shipping, fossil fuel non-proliferation, payment for nature, Carbon accounting, ESG standards, climate risk and trade union representation. However, given the urgency of the climate emergency we will work with like-minded countries to support initiatives and ensure a level playing field for economic actors participating.
EC951 International finance like other sectors should be regulated by national governments and international arrangements. Secrecy and tax havens should be abolished(EU424, In616).
EC9352 Finance flows out of the city of London should be clear about their climate and biodiversity impacts and risks. This would likely include ending financing of and insurance of new fossil extraction and divestment from their assets in these sectors. It would also likely involve greater flows of climate finance and technology to global south countries(EN111).
EC953 The UK government should facilitate the cancellation of some international debt (IN233) and in some circumstances reparations for actions of the UK government in its former colonies [reparations motion].
EC955 A Green government would commit to a fair share of global public investment as a replacement for ‘overseas development finance’.
Polices should cover:
Green book is about rules on investment:
EC1001 Government should manage taxation (fiscal) and monetary policy in a coordinated fashion in order to manage inflation, fund government expenditure, regulate the banking sector and ensure adequate liquidity in the wider economy.
EC1002 An emergency response requires managing the money supply, taxation, borrowing and public spending to navigate shortages of certain skills, materials, types of energy or geographical availability of labour, and to create bold economic drivers of change to business and daily practices for a limited period of time. To maximise the speed of decarbonisation the effect of taxation (e.g. Carbon Tax) on reducing non-essential demand may need to be supplemented by regulation.
EC1003 Inflation will be managed through measures including restricting the use of scarce resources by polluting and non-essential sectors and targeted taxation. There will be a flexible inflation target so inflation can be used as a tool to deliver significant relative price adjustment without risking problems of negative equity, and to avoid deflation In some sectors, which can be more damaging than excessive inflation.
EC1011 The government should democratically control money creation and direct it towards good economic use, which is in line with social and ecological objectives, including curtailment of harmful economic activities, acceleration of the green transition, ensuring minimum living standards, and developing resilient communities.
EC1012 Money creation should be overseen by a Parliamentary Select Committee, which will oversee regulation of the money supply and interest rates while monitoring utilisation and availability of labour, skills, energy, materials and infrastructure/machinery.
EC1013 Banks will no longer be permitted to create money. Instead banks and other funding bodies will be required to fund lending by attracting savers’ deposits, borrowing from investors, and utilising a revolving loan facility provided by the Bank of England to access newly created money. Such Bank of England loans will be made available only for socially and environmentally sound onward lending purposes, at reasonable rates of interest.
EC1021 The main reasons for taxation are: to provide money to fund public expenditure, to redistribute income and wealth, to influence behaviour, including behaviour that promotes ecological sustainability and public health, and to support broader management of the economy. (See EC###, …)
EC1022 A simple and fair tax system which makes it hard to evade or avoid paying what is owed will tend to have few exemptions and allowances. Exemptions and allowances should be confined to cases where there are clear environmental or social aims, or where fairness demands them. For example, avoiding double taxation, or where they make taxes easier to collect.
EC1023 The proceeds of particular taxes should not normally be specifically allocated to particular areas of spending, and nor should the spending on a particular area be restricted to the proceeds of a particular tax. In cases where such hypothecation is a precondition of public acceptance or where transparency and accountability make it desirable, there must be a duty on the level of government concerned to provide reliable and verifiable information on the extent to which the policy of earmarking is being respected in practice.
EC1025 We recognise that some of the changes to taxation we propose will need to be introduced gradually and in stages and in many cases with appropriate transitional measures.
EC1026 Approaches and measures to promote tax compliance will include: a general anti-avoidance principle; obliging banks to provide information about companies automatically to HMRC; abolishing the rule that allows non-domiciled residents not to pay tax on foreign income (though we would respect the normal double taxation conventions); internationally, pursuing efforts through the G20 and other bodies to secure an international agreement to eliminate or restrict the pernicious effects of tax havens; and domestically, requiring offshore companies to reveal their beneficial ownership before being accepted as competitors for publicly funded contracts.
EC1031 The current complex system of individual taxation whereby different sources of income are taxed differently should be replaced with a far simpler and fairer system of income taxation and social security support. This would have two principal elements: Every citizen would receive an unconditional Universal Basic Income to secure their basic social security (see EC### above); and A new Consolidated Income Tax (see EC##2).
EC1032 Consolidated Income Tax will apply to all income, benefits in kind and realised gains received by an individual. It will exclude transfers related to disability (which would continue). The Consolidated Income Tax will cover: earned income, such as wages, salaries; private pensions; income from self-employment after the deduction of reasonable expenses; unearned income, such as interest, rental income and dividends; and realised capital gains.
EC1033 Personal allowances could be adjusted and perhaps eventually removed to take account of the introduction of Universal Basic Income. There will be a small, standard personal tax-free allowance for capital gains from non-financial products. Tax will be levied on all consolidated income above any personal allowances.
EC1034 Tax rates will be banded and will increase progressively so that those on higher consolidated incomes pay higher marginal rates of tax.
EC1035 As a consequence of the Consolidated Income Tax, Capital Gains Tax and Employee National Insurance will be abolished.
EC1041 A Land Value Tax will be introduced on all land. This will ensure that the holders of land contribute to the common good. The rate will apply to the capital value of the land itself, not including any buildings etc. built upon it.
EC1042 Local authorities may levy an additional local percentage (subject to EC792?) for which they would receive all the revenues.
EC1043 The Land Value Tax will be collected by the relevant Common’s Trust (see LD303) but surplus revenue will be distributed to local and regional government (see EC###).
EC1044 Land Value Tax will be introduced gradually and in time, replace other land- and property-based taxes (see HO603). There will be no exemptions for different land uses from this policy. Where obligations are placed on landowners to conserve wildlife habitats, archaeological sites or other landscape features, the capital value of the land may be assessed as zero or negative, and LVT would then become a subsidy. The effect of LVT on UK Agriculture will be managed through changes to farming subsidies in line with objectives laid out in the Food and Agriculture chapter. As a transitional measure, where land necessarily attached to a domestic dwelling was subject to a mortgage on the day the tax was introduced, the tax would apply only to the value of the land net of the mortgage. Owner occupiers aged over 65 years will not be exempt, but they will be able to ‘roll over’ payments until the home is sold. (See HO401, HO603, IN408, TM043)
EC1051 There should be a progressive wealth tax applied to the wealth of all UK residents above a certain threshold (excluding Land – See LVT, EC###). In addition, we would work with governments around the world to agree a global wealth tax.
EC1052 The main UK tax on consumption of goods and services is Value Added Tax: a) The broad structure of both VAT and duties should be retained; b) Other taxes to compensate for the regressive tendency of VAT; c) VAT rates and levy duties should be set at higher levels for luxury goods and lower levels, including exemption, for essentials; d) VAT should have higher rates and duties should be imposed to discourage harmful behaviour, in particular environmentally damaging and ecologically unsustainable behaviours and consumption; e) It is critical to recognise that c and d above may conflict in particular cases (e.g. domestic energy, and if so, seek to achieve a balance between them; and f) Duties should be used in preference to VAT where it is primarily the physical quantity we want to control, and the supply chain provides a convenient point for doing so.
EC1052 In an effort to promote sustainable behaviours, we will seek to reduce VAT on, or the prices of, non-polluting and pollution-reducing goods and services by up to the amount raised by any eco-taxes introduced or increased (EC776).
EC1053 Taxes designed to encourage changes in behaviour do not, if they are successful, provide large amounts of Government revenue in the longer term. Their effectiveness should be judged in conjunction with other non-fiscal measures that aim to reduce the prevalence or impacts of the behaviour that is being tackled.
EC1054 Taxes on the consumption of alcohol and tobacco will be extended to other recreational drugs that remain or become legal, to the extent that their use imposes costs on the health system. Taxes on alcoholic drinks will be broadly proportional to their alcoholic content.
EC1055 Resources will be provided at a cost-effective level to ensure that the aims of this kind of taxation are not undermined by smuggling from countries where a lighter regime prevails or where enforcement is weak.
EC1056 The current range of environmental tax measures (such as taxation of pollution) will be expanded to promote sustainability and combat pollution more effectively. These taxes too will be combined with remedial measures such as regulation, as set out, for example, in the Energy chapter. They will take a variety of forms, but the common aim will be to ensure that the environmental costs of emitting and polluting activity are borne by those responsible, and hence, to promote more environmentally benign processes. In cases of local pollution, taxes may be imposed and collected locally (EC796).
EC1057 A carbon tax will be introduced whereby a steadily rising price will be placed on sources of greenhouse gas emissions in the UK, and those embedded in imports (EC779). The exception to this will be all (non-built environment) emissions from land and livestock management, which will be discouraged via land management investment support (see FA301, FA602, LD505), or restricted via the planning system (see LD502, LD504).
EC1058 Fuel duties currently address different detrimental effects of road traffic – congestion, local pollution and noise, accidents and greenhouse gas emissions. Only the last of these is appropriately tackled by a uniform nationwide tax. it only takes account of engine efficiency and miles travelled. The others will gradually become a local responsibility, underpinned by increased local authority powers to tax, charge and regulate vehicle movements (EC791).
EC1059 Import duties will be levied on both raw materials and finished products which will reflect the ecological and social impact of the production, extraction and transportation of such goods where sufficient eco-taxes are not considered to have been levied in their country of origin, or ecological or social regulation is inadequate.
EC1061. Corporation Tax will continue to be levied on the net profits declared by companies operating in the UK. In addition, any profits distributed abroad, which currently avoid further UK incomes taxes, will be subject to an additional ‘withholding tax’. This should seek to equalise the overall rate of tax levied with the basic rate of Consolidated Income Tax.
EC1062 We would extend Stamp Duty on Shares to all shares. This will include all publicly traded shares, as well as shares in private companies with an annual turnover in excess of £100million, with the exception of ‘market-maker’ and similar intermediary transactions.
EC1063 We would retain the Bank Asset Tax (Bank Levy), levied at a rate sufficient to capture a large part of the value of public assets, subsidies and protections routinely extended to the banking sector.
EC1081 Additional vision for localisation and decoupling from economy global here? This section needs to include policies covering: Local economic management and planning Local investment Local government finance cross reference to governance section….(see EC422-8) Local taxation (with redistribution of revenue – Common’s Trusts or a commission?) See: PA501, PA 503, LD400, TR069-70, TR542
EC1091 There maybe some odds and ends of economic policy that don’t fit anywhere else in structure above and need including at the end. Follow topics are cover in existing chapter and might be worth including her if not elsewhere: The ‘Personal’, ‘Informal’, & ‘home’ Economy Policies and research into home-based economy and enterprise Post Office
EC1092 In a Green society the informal sector will eventually gain in significance so that formal transactions and money generally will have a lesser role than at present.
=== End of Economy Chapter ===
Make the following Consistency Changes to other parts of party policy:
If any…
Culture Media & Sport CMS640-7 –> TV licence - CMS641 General Taxation
CMS672 –> BT & Broadband – Levy on all users to support remote communities rather than it being funded by general taxation. (hypothecation?)
Is this just a recommendation to BT (a private company)? If so, probably could remove and just leave the requirement in place.
CJ500 -> Gun Licencing (hypothecation?)
FA602 - Add cross reference to UBI in Economy Chapter.
HE130 –> ?
HE1412 –> ?
###Housing HO401 (d) Add cross reference to Banking Policy HO401 (f) Add cross reference to Regional Redistribution Policy EC503 - may change numbering HO500 Add cross reference to Funding Local Government HO501 Local authorities should be able to borrow at prudential limits without interference from central government. This should no longer be necessary if the new approach to Funding Local Government is adopted. So consistency change would mean deleting this policy. HO515 Update to new number for cross-reference to community banking policy. HO516 Update to new number for cross-reference to Economy policy on Land Value Tax. HO600 Update to new number for crossreference to UBI policy HO603 ‘Housing Finance - Council Tax’ Note that the policy is to replace council tax with LVT and the changes to council tax are steps towards that. HO604 Change to reflect approach taken to Funding Local Government. Remove reference to repayment as not required and, in any case, based on latest calculations in 2024, payback period would be too long.
PA308 –> Remove reference to Council Tax and just say automatically registered to vote?
IN309-10 –> Needs a cross reference to/from Economy Chapter IP policies.
IN312 –> Needs a cross reference to/from Economy Chapter Citizens Income policies. Might need language change for consistency.
IN405 –> References EC780 on LVT - Cross reference will need updating.
IN406 –> References EC771 on VAT - Cross reference will need updating.
IN408 –> Various cross references may need update. LU VP changes not yet online.
IN415-18 –> Policy on Community Banking that has cross references to EC512 (Local Economy), EC664 (Sovereign Money Reform). Potential duplication with new EC chapter to resolve & cross referencing needed.
IN601-29 –> May duplicate Setting terms of engagement section - Will need cross references
###Public Administration and Governance PA912 –> To expand the ability of a local councillor majority or council deparment executives to go beyond forums into other forms of deliberation if they wish to or have a mandate to do so. Also adding some responsibilty of central government to create guidlines for some of these mechanisms.
TR062 –> Amending discussion of hypothecation
TR069-70 –> Road charging, vehicle excise duty and parking levies
TR540-44 –> Financial Measure to address aviation
HO101 Housing as speculative investment. Reference to Land Value Tax as one way that this would be tackled.
HO102 Regional inequality in housing. Reference to ECxxx (relationship between national and local government) and ECxxx (regional redistribution).
HO401 Cross reference to Land Value Tax ECxxx HO501 Local authorities should be able to borrow at prudential limits without interference from central government. Need to check this matches to economic policy on Banking.
HO513 Community led housing organisations will be assisted by provision of easier access to sources of finance and simplification of the conveyancing process and other regulations. The Green Party would ensure revenue and capital funding is available on terms that are suitable for the variety of local projects communities develop. We would also require the Bank of England’s regulatory bodies to enshrine the International Cooperative Alliance’s Cooperative Principles in their policies and practices, for example to better tackle demutualisation. Consistency change required to match to Banking policy.
HO607 Add reference to ECxxx Change to Companies Act and ECxxx Strengthening of CMA.
HO801 Change to say UBI instead of Citizen’s Income.
WR361 and WR370 Change from Citizen’s Income to UBI
To be determined…
Delete Spring 2009 statement titled “Campaigning for an alternative economic strategy” –> Need to makes sure everything in this is incorporated by VP - see #54
Last updated on 2024-11-02 at 12:44