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BrexitJanuary 31, 2020, was a historic day for the European Union, for it marks the day the United Kingdom left the Union based on a public vote (referendum) held in June 2016. Seventeen point four million citizens opted for Brexit in 2016 and, after several negotiations and talks, the U.K. is now the first former member of the European Union. An important and large-scale decision such as this has the ability to distort economic stability greatly.

Trade

The EU is the world’s largest single market that allows free trade among all its members. It is also responsible for negotiating trade policies on behalf of its members, establishing a single, strong voice throughout various negotiations. Since Britain is no longer a member, it must create its own suitable trade policies with the countries it wishes to trade within the Union. Britain also needs to negotiate for its own demands. It was projected that the U.K. stood to lose $32 billion after Brexit, with no trade agreement in place between the U.K. and the EU. Losses incurred are more likely to increase as the EU accounts for nearly 46% of the U.K.’s exports. Researchers project that Ireland’s exports to Britain may drop by at least 10%. This creates a serious trade imbalance and hence contributes to the national deficit of the nation.

Food Poverty

British citizens consume a significant amount of imported food. Brexit could lead to a rise in food poverty, as about 30% of food is imported from the EU and 11% is from countries whose trade policies were negotiated by the EU. Since there is no trade policy in place, food insecurity is bound to rise. Food prices will likely rise 6% by June 2020, according to researchers. Overall, an increase in food poverty may be on the horizon.

Immigration

The U.K. had announced that post-Brexit only highly skilled immigrants will be able to secure jobs and the additional requirements have already created an impact on the economy. Immigrants mostly work low-skilled jobs and the implementation of this policy has already lead to shortages. At least one in 11 posts are vacant. Also, immigrants occupy nearly one-sixth (140,000) of the 840,000 care worker jobs. The new regulations will soon prompt vacancies and greatly affect people with disabilities and the elderly.

The Potential Solutions

Trade talks between the U.K. and the EU are taking place effectively. British Prime Minister Boris Johnson proposed a “Canada-style free trade agreement” which the EU is prepared to accept, given the fact that the agreement would demand no tariffs or quotas from them. This shows that negotiations are productive and that the U.K. is trying to cause very little disturbance to the economy. Aware of its reliance on imports from the EU, the U.K. has opted for a mutually beneficial free trade agreement. As the cost of imports and exports are reduced, the trade imbalances are corrected. This in turn will influence food poverty as the general price levels will decrease and imported food will become affordable.

Additionally, there are multiple organizations and government schemes that help combat food poverty in the U.K. For example, The Trussell Trust and other independent foodbanks have distributed nearly 3 million food packages between 2018 and 2019. The organization Healthy Start allows the purchase of basic food necessities for pregnant women and mothers with infants.

What Are the Benefits of Brexit for the UK?

The U.K. is free to trade with other nations such as Japan, the U.S. and India without EU restrictions. This will stimulate growth in all nations involved in possible free trade and help tackle domestic issues, such as unemployment and hunger. Effective trading can lead to increased employment opportunities and better living standards.

The U.K. has given almost half a trillion pounds to the EU to be a member of the bloc. The amount the U.K. will save is significant enough to be directed at rising food insecurity, short-term deficit and unemployment. The U.K. is also able to craft specific policies to suit its needs instead of being subject to the ones crafted by the EU. The ability to do this helps the U.K. and other nations involved, as all policies will be tailored to be mutually beneficial and appropriate.

Overall, Brexit is a challenge. It is difficult to adjust to and likely poses serious threats to economic stability in the near future. However, this is only a short-term issue. Once the transition period is over, a structured agreement between the E.U. and the U.K. will help their economies regain stability.

 Mridula Divakar
Photo: Flickr

Poverty Rate in the United Kingdom

A recent study from the U.K.’s Office for National Statistics (ONS) has shown that the poverty rate in the United Kingdom fell slightly between 2014 and 2015, dropping from 16.8 percent to 16.7 percent. This rate puts the U.K. roughly in the middle of all E.U. member countries, and just below the E.U. average of 17.3 percent.

The report of a fall in the overall poverty rate in the United Kingdom also came with a reported rise in the persistent poverty rate. The persistent poverty rate is defined as being below the poverty line in the current year, as well as in 2 of the previous 3 years. The persistent poverty rate jumped from 6.5 percent in 2014 to 7.3 percent in 2015. The jump means that 700,000 more people were persistently poor in 2015 than 2014. However, this rate ties for the fifth-lowest in the E.U. and is well below the E.U. average of 10.9 percent.

The rise in the persistent poverty rate did lead to concern from different parties. Justin Watson, the head of the Oxfam U.K. Programme, welcomed the relatively low persistent poverty rate compared to the rest of the E.U. while expressing concern about the 4.6 million people experiencing persistent poverty. Others expressed concern about rising child poverty rates and a disparity between male and female persistent poverty rates.

Addressing the U.K.poverty rate will require more than employment expansion. Median earnings are down 5 percent in the U.K. since the 2008 global recession, even while employment is up 1.5 percent in that same period, hitting a record high in July 2017. A government official cited multiple steps being taken in addition to employment in the attempt to address the overall U.K. poverty rate. In fact, the government spends £90 billion a year  on working age benefits, the National Living Wage is rising and income tax is being lowered or eliminated for millions of people.

Erik Beck

Five Main Causes of Poverty in the UKThe U.K. has been one of the wealthiest countries on the planet for centuries. Despite this, however, poverty remains a serious issue in the country. An estimated 13.5 million people live below the poverty line. Last year, one in five people struggled to put food on their table, with more than half a million reliant on food banks in order to feed themselves and their families. The question remains as to what the primary causes of poverty in the U.K. actually are.

  1. It may seem counter-intuitive to think that for a country recording its lowest rates of unemployment, that employment could be a cause of poverty. While work is assumed to be the main way for people to escape poverty, this is not always the case. For those in low-paid jobs or part-time work, income can be limited. Coupled with such positions often have little potential for progression, certain employment opportunities seem to exacerbate poverty rather than offer the relief many people need.
  2. A lack of education and technical skills is another primary cause of poverty in the U.K. Around five million U.K. adults do not have basic literacy and numeracy skills, leaving them at a serious disadvantage when it comes to finding gainful employment. Compounding matters, 12.6 million lack any form of digital skills, since many employment opportunities involve at least a small amount of computer use.
  3. Issues in home life can facilitate a fall into poverty, for example, domestic violence, substance abuse or underemployment. Children are often at risk in situations such as these, with research showing that boys raised in a difficult household are far likelier to be excluded from school or become involved in criminal activity. For girls, the situation is similar, with those growing up in similar circumstances show to be more at risk of mental health problems as well as more likely to enter into early parenthood, at times characterized by further abuse.
  4. Inadequacies in the benefits system can also cause further poverty. For many, the system can be difficult to understand and navigate, which can lead to mistakes or delays in payment. For many, the benefits they receive are simply not enough to help them avoid poverty. In fact, it is estimated that for a family with one child claiming benefits, receives around 65 percent of the required amount to keep them above the poverty line.
  5. The final primary driver of poverty in the U.K. is the cost of goods and services. Between 2008 and 2014, living costs increased three times faster than the average wage. The cost of housing, food and utilities have quickly risen in recent years, with increased childcare costs also placing a strain on families’ finances.

While these issues are problematic for many people across the U.K., attempts have been made to alleviate the damage. The national living wage, introduced in 2016, was created in order to reflect the costs incurred by working people in the country. There are charities such as the Child Poverty Action Group and End Child Poverty that target vulnerable families. Though it may take time, the fight is certainly underway against poverty in the U.K.

Gavin Callander
Photo: Flickr

Common diseases in the United Kingdom
According to the CIA World Factbook, the United Kingdom is home to 64,430,428 people, many of whom fall victim to various illnesses. The list of common diseases in the United Kingdom includes the following:

  1. Coronary heart disease causes nearly 74,000 deaths each year, which amounts to approximately 200 individuals dying every day from the disease. A significant amount of people with coronary heart disease are younger than 75, and, as such, additional health checks are being emphasized in the country.
  2. Respiratory diseases such as asthma and chronic obstructive pulmonary disease (COPD) are categorized as some of the most common diseases in the United Kingdom. In fact, England has one of the highest rates of asthma prevalence in the world. While the primary cause of COPD is smoking, a small percentage of cases are triggered by exposure to fumes, chemicals and dust at work.
  3. Stroke is the third leading cause of death in the United Kingdom and the leading cause of disability, with more than 150,000 people suffering from strokes every year.
  4. Cancer has become incredibly common, partly due to the fact that the United Kingdom falls behind other European countries in terms of accessible treatment and cancer survival. It is estimated that, by 2030, three million people in England will have had some form of cancer.
  5. The number of deaths from chronic liver disease in people under 65 has risen about 20% in England, while other European countries have seen improvement and a decrease in diagnoses.
  6. Health inequalities continue to play a role in poor health outcomes for those in the lowest socio-economic groups. Tuberculosis (TB) is one major infectious disease concentrated in the most deprived areas of the United Kingdom. In 2015, the rate of TB was 20.5 per 100,000 people in the 10% of the population living in the most deprived areas, compared to only 3.6 per 100,000 in the 10% in the least deprived areas.

With the pervasiveness of such diseases, immunization and cost-effective healthcare are highly prioritized in the U.K. Nevertheless, most common diseases in the United Kingdom are preventable, and individuals should consider taking the necessary steps and precautions to follow healthier lifestyles. According to a country profile health report conducted by the World Health Organization (WHO), a few adult risk factors responsible for contributing to the increase in common diseases in the United Kingdom include tobacco smoking, alcohol consumption, raised blood pressure and obesity.

Mikaela Frigillana

Photo: Flickr

Foreign Aid From the UK
During the G20 conference in Hamburg, British prime minister Theresa May announced a new financial plan for aiding disaster-stricken countries, which included opening the London Centre for Global Disaster Planning. The center will be aimed at helping developing nations plan for times of crisis. If successful, this could eventually reduce the amount of money spent on emergency foreign aid from the U.K., create private jobs in affected countries and allow countries to respond more efficiently to various crises.

In addition to the proposed £30 million going towards creating the center, the British government will be investing £60 million into the African financial market. The overall goal of this plan is to create more stable insurance markets in foreign countries. While this immediate boost in foreign aid from the U.K. is in direct opposition to the Conservative Party’s recent push to cut spending on foreign aid, the end result could greatly benefit Britain financially. As May stated, these changes will benefit the U.K. by “helping to build Britain’s trading partners of the future, creating real alternatives to mass migration and enhancing our security.”

The Centre for Global Disaster Planning will help prepare African countries for emergencies such as the ever-increasing problems with drought in East Africa. “This will reduce the need for expensive humanitarian aid, reassure private investors and help people rebuild their lives,” stated a senior Downing Street official.

In addition to the investment into the Centre for Global Disaster Planning, the U.K. plans to allocate £60 million to Tanzania, £30 million to Somalia, £35 million to Ethiopia and £11.8 million to Rwanda. Each investment will target areas of financial weaknesses in its respective country. While there may not be immediate economic gains for the U.K. economy, results will ideally begin in poorer African countries and eventually result in new markets for Britain.

For example, the money going to Rwanda will hopefully boost private investment, which can alleviate poverty, create jobs and promote sustainable development. According to Sally Waples, head of the Department for International Development in Rwanda, the ultimate goal is a “self-financed exit” from poverty through private sector growth.

While this plan requires a great amount of initial investment, its success would reduce Africa’s reliance on foreign aid from the U.K., strengthen its economy and create a multitude of new markets for trade. In preparing Africa for crises such as environmental disasters, this investment will reduce the amount of money spent on recovery in the long-term.

Julia Morrison

Photo: Flickr


The United Kingdom and Indonesia have signed a cooperative agreement that establishes a 10-part research project investigating numerous aspects of social and economic development in Indonesia.

Indonesian Research, Technology and Higher Education Minister Mohammad Nasir, along with the British Ambassador to Indonesia, ASEAN and Timor-Leste Moazzam Malik, signed the agreement at the first-anniversary celebration for the UK-Indonesia Science and Technology Fund, established March 23, 2016. This fund was developed by The Newton Fund, a collaborative development program established in 2014 for research and innovation between the UK and Indonesian governments.

One year prior, at the UK-Indonesia Science and Technology Fund commencement, Malik announced the UK’s commitment to the equivalent of nearly $12.5 million each year until 2021. This amount of aid would be used in support of improving research and innovation geared towards development in Indonesia.

The mission of the fund is to make significant contributions toward expanding and developing systems of research and innovation in Indonesia through increased cooperation. At the time of the fund’s inauguration, independent funding was planned to be the primary means of expanding the relationship between the UK and Indonesia.

The core initiative within the fund’s scope was to increase the demand and response for research proposals focusing on health, food and energy sustainability, maritime preservation, disaster relief and urban development in Indonesia. The anniversary event — held on April 5 in Jakarta, Indonesia — was evidence of the fund’s success.

Before the UK and Indonesian representatives signed the accord, researchers had the opportunity to present their projects and share their findings. The presentations were in recognition of the researchers’ vital role in advancing resources and benefits for development in Indonesia and in an effort to demonstrate that collaborative research and innovation produce better results.

Nasir described the agreement’s significance, stating, “In order to achieve the goal, international collaborations, such as that with the UK, are necessary, so that we don’t have to start from scratch. Together, we can find a better way to improve the global society.”

As per the agreement, the UK and Indonesian governments have both made the commitment to apportion the equivalent of nearly nine million dollars collectively to a joint commitment fund. The contributions will be used to carry out collaborative research in the areas of science, technology, innovation and development in Indonesia.

Jaime Viens

Photo: Flickr

Fight Global Poverty ODA Spending
David Cameron will be remembered by history as the Prime Minister who called the “Brexit” referendum, but during his last days in office, Cameron sought to stress a different achievement: lifting Official Development Assistance (ODA) spending to 0.7 percent of national income.

The target was met during a time of economic austerity and in spite of intense criticism from members of Cameron’s own political party. This resolve should inspire other wealthy countries to do their part in fighting global poverty.

Looking at the data, several facts jump out. The UK has a clear lead among G7 countries and is the only one to meet the UN’s recommended 0.7 percent target. The United States, despite being both the wealthiest country in the G7 on a per capita basis and the largest economy in the world, comes in last in ODA spending relative to national income.

If America spent the average 0.35 percent of other G7 countries, it would spend an additional $33 billion a year. Reaching the level of the UK would mean over $90 billion more.

Warren Buffet and Bill Gates have given away over $54 billion total as part of their philanthropic efforts. The Giving Pledge, Gates’ and Buffet’s initiative to encourage the wealthy to give away their fortunes, has so far attracted total pledges of around $360 billion from 139 of the wealthiest individuals in the world.

The yearly contribution America could give by rising to the UK’s level of ODA spending is larger than the total lifetime donations of two of the richest men in world and a third of the total amount pledged by 139 billionaires. This is a powerful reminder that the political process is a central part of the struggle against poverty.

The first of the post-2015 Sustainable Development Goals is to “end poverty in all its forms everywhere.” This ambitious goal calls for a concerted effort on the part of wealthier countries. Since the UN adopted the resolution in 1970 which stated ODA spending in developed countries should be at least 0.7 percent of their gross national product, only a handful of countries have risen to that level.

Aid skeptics often point out that waste, fraud and corruption mean that much of the aid meant for poor beneficiaries ends up lining the pockets of kleptocrats. This problem is exaggerated, but it should serve as a call to action for reforming aid distribution practices, rather than a reason to cut off support for those who need it most

Jonathan Hall-Eastman

Photo: Flickr

International_Gender_Inequality
A new collaborative study published by the Great Initiative and Plan UK, two development organizations who work to promote female rights, has reported that the United Kingdom’s Department for International Development (DfID), has reached a great success in the implementation of a new legal statute that will measure the impact of the agency’s foreign aid operations in reducing the prevalence of international gender inequality.

The International Development (Gender Equality) Act, which was put into effect last May, places a responsibility on the United Kingdom to continually assess and implement strategies designed to strengthen international gender equality within countries receiving funding for development.

The report praised DfID for establishing a new international precedent for the integration of the issue of gender inequality into broader humanitarian efforts, and noted the U.K. should encourage other Western nations to take similar measures.

Many developed nations have become involved in the battle against gender equality in recent years, including the Netherlands Ministry of Foreign Affairs who launched the Millennium Development Goal 3 Fund in 2008. This investment of nearly $100 million proved to be the largest ever government gift to support development organizations working to support gender equality efforts. According to the Association for Women’s Rights in Development, the fund impacted the lives of 220 million people, including 65.5 million women and girls, and provided assistance to over 100,000 women’s rights organizations.

The study concluded, “We were delighted to find that the act has both driven, and joined forces with, other measures to promote gender equality. At the time of our analysis (May 2015) 64 percent of the business cases in our sample contained a clear statement addressing gender impact and only 18 percent of business cases lacked this statement,” referring to 44 development projects analyzed as part of the study.

A specific case-study included within the report analyzes the impact of a DfID-funded program to repair and resurface a road within Western Uganda on gender equality. Mariella Frostrup, a founding trustee of the Great Initiative familiar with the study, stated, “It surprised us, and indeed it turned out to be one of the most transformative projects we found in our evaluation. It identifies women’s land ownership, violence against women, women’s employment and social norms and stereotypes as issues to be addressed.”

She continued in explaining, “It mandates that 25 percent of jobs on the project are reserved for women, that women’s safety and security is guaranteed and that gender sensitization and awareness projects are run alongside the actual construction.”

Justine Greening, the International Development Secretary of the UK, explained in a June interview that DfID was determined to continue pursuing the issue of gender inequality, specifically working to reduce the occurrence of female genital mutilation and child marriage. Two of the largest issues associated with gender inequality, officials hope to reduce the persistence of such human rights violations by providing continual funding and assistance to developing and impoverished regions.

James Thornton

Sources: The Guardian, Devex
Photo: Flickr

UK_Foreign_Aid_for_Flood_Victims
On February 12, over 140,000 people signed a petition created by The Daily Mail to have foreign aid money go to victims of recent destructive flooding in Britain.

The floods took place over six weeks ago and many British citizens are trying to put pressure on Prime Minister David Cameron to put more funds towards helping flood victims. Cameron has refused to use foreign aid money for these purposes, saying, “I don’t think it’s needed to go for the aid budget because we will make available the money that’s needed in Britain.”

Many global poverty experts have spoken about this campaign, calling it “outrageous.”

Several prominent experts including And Etharin Cousin, the executive director of the World Food Programme called this campaign to use funds dedicated to foreign aid in Britain an “extremely worrying” minority view and hoped that it would be ignored by governments. Experts have further called the campaign “inexcusable and unforgivable” as well as “disgraceful.”

World Vision chief executive Justin Byworth has said that this situation is a “political excuse” to put foreign aid in a negative light. Byworth has also said, “Anything that politicizes poverty here and in the UK, makes me angry, we are promoting a political agenda on the backs of the poor. It should be our humanitarian agenda that drives us.”

In the article published in The Daily Mail, writers use a one-sided viewpoint in addressing any foreign aid that Britain has given, attempting to show that relief money has been used poorly. The comments on the site seem to reflect these views and the site even offers a link to contact the prime minister to express concern about the use of funds.

Poverty experts have cited the importance of realizing that foreign aid helps everyone, as it is an essential investment. Cousin has said, “The reality is that we live on a very small planet. Food security in one part of the world means security for another part. We are hopeful government [will] recognize the need to support both population[s].”

Experts are imploring that people need to understand better the impact that foreign aid has on its recipients. Dr. Kanayo Nwanze, president of the International Fund for Agricultural Development, urges people to understand, “The mistake we make, we do not see the connection between instability and how it affects global peace. As the rural areas are destabilized, people migrate to urban areas, and there they often become even poorer, more frustrated, desperate and susceptible to rhetoric.” Nwanze attributes this to how so many end up living in militancy.

Urgency can be found on both sides of this argument, with one side demanding action on behalf of British citizens and the other reminding world of how important it is to maintain humanitarian action. What Cameron and Britain ultimately decides to do regarding this issue could have an impact on the way other countries use foreign aid. As poverty experts continue to emphasize the effect foreign aid has on a global level, and not simply the effect it has on the recipient, it will be up to the British government to make the best possible decision.

– Julie Guacci

Sources: Huffington Post, The Daily Mail
Photo: Daily Mail

uk_poverty_unemployment
The Organisation for Economic Co-operation and Development (OECD) said the United Kingdom’s high levels of youth unemployment will lead to widespread poverty in the elderly when this generation reaches retirement age.

The Guardian reported that the pension schemes in place right now, which “are built on monthly contributions, will be undermined if younger workers stay unemployed for long periods.”

The OECD projects that people will live to be 100 years old and will reach retirement at 70, reported the Guardian. The OECD said “the weakness of the British state-funded system meant workers in the UK were among the most vulnerable.”

According to the OECD’s “Pensions at a Glance” report, only Mexico has a lower state pension, with an average of 28.5 percent of their working income. The U.K. has 32.6 percent, and the Netherlands top the list with 90.7 percent.

According to Express Newspaper in the U.K., workers will have to wait until they are 80 to retire with an average income of £25,500 a year. And then, Express said, “they would need to have saved nearly £350,000 almost 12 times the average pension pot of just £30,000.”

By 2050, men and women in most countries will have to be at least 67 years old when they retire. The OECD found a 3.5 year increase with men and a 4.5 year increase on average for women.

The OECD said governments need to encourage their citizens to work longer and save more money for retirement to “ensure that benefits are adequate enough to maintain standards of living in old age.”

Stefano Scarpetta, employment specialist at OECD, said it is of great concern that so any countries are building these contributory pension systems when they have such high numbers of unemployed young people who cannot save for their retirement.

On most measures, the U.K. comes in in the lower-half of the “pensions league table.” This includes public expenditure on pensioner benefits and pensioner living standards, which fall short.

The Netherlands, which tops the list of state pensions, also has the highest standard of living for retirees.

The OECD said the “U.K. had raised the average incomes of people above the retirement age and introduced plans to expand coverage through the workplace pension savings scheme Nest, which is expected to automatically enroll 10 million workers over the next three years,” the Guardian said.

The Guardian said this has a “knock-on effect of policy reforms,” which can protect the benefits of older workers, but put younger workers at a higher risk for poverty as retirees.

The OECD said many countries have “failed to construct adequate protection for low earners.”

– Alycia Rock

Sources: OECD, The Guardian, Express, Employee Benefits