Budgets & fiscal events· Public spending· Economy and public finances· Tax· Political parties and elections Time for revision: why the Chancellor needs to look again at his plans for tax cuts in the Budget 14 March 2016 by Stephen Clarke and David Finch and Matthew Whittaker This briefing note considers possible tax cuts that could feature in the Chancellor’s upcoming Budget, and looks at how these policy choices can be made in a way that better benefits lower earners. READ MORE
Pensions & savings· Tax Save it for another day: pension tax relief and options for reform 10 March 2016 by Adam Corlett and Matthew Whittaker The Treasury has reportedly backed away from pension tax reforms, at least temporarily. Given the scale of existing tax relief, its particular benefits for higher income savers, and the potential wider impact of any change, this is perhaps understandable. But there remains a strong case for making the current system cheaper, fairer and better targeted. … Continued READ MORE
Living standards· Incomes· Inequality & poverty Living Standards 2016: The experiences of low to middle income households in downturn and recovery 15 February 2016 by Adam Corlett and David Finch and Matthew Whittaker This is the Resolution Foundation’s seventh annual state of the nation report on living standards, and it is testament to the depth of the downturn that has gripped households since the financial crisis hit that average incomes only just appear to be returning to the level they were at when we published the first one in the series. In … Continued READ MORE
Economic growth· Macroeconomic policy Renewed Interest: The role of monetary policy in crisis and beyond 28 January 2016 by Matthew Whittaker Interest rates are at an all-time low. The Bank of England’s base rate is about to enter its eighth year at 0.5 per cent – the lowest level in its history and its longest period of non-movement since the Second World War. Yet still UK inflation remains well below its 2 per cent target, bumping … Continued READ MORE
Budgets & fiscal events· Public spending· Economy and public finances O, blessed revisions: fiscal windfall and what to do with it 26 November 2015 by Matthew Whittaker Resolution Foundation’s Autumn Statement analysis, including: Economic outlook Public finances outlook Taxes and benefits Public services The changing state READ MORE
Public spending· Fiscal policy· Economy and public finances Shape shifting: the changing role of the state during fiscal consolidation 10 November 2015 by Matthew Whittaker and Adam Corlett and David Finch Resolution Foundation’s latest analysis looks at the changing size and shape of the state and what decisions the government will need to make going forward. READ MORE
Economic growth A recovery for all? The evolution of the relationship between economic growth and pay before, during and since the financial crisis 14 September 2015 by Matthew Whittaker In this note, we use the latest wage and National Accounts data to consider how the ‘wedge’ between productivity growth and median pay growth that arose prior to the financial crisis in the UK – and which appears to have become a feature across a range of advanced economies in recent decades – has developed … Continued READ MORE
Labour market Completing the job: the pursuit of full employment 20 July 2015 by Matthew Whittaker and Paul Gregg While there is some consensus around the merits of pursuing full employment, there is no widely agreed definition of what constitutes ‘full’. Nor have we heard much on quite how any given target might be achieved. In this briefing– which marks the launch of a major piece of research on the topic which will conclude before … Continued READ MORE
Living standards Time to catch up? Living standards in the downturn and recovery 12 March 2015 by Matthew Whittaker width=”476″ height=”400″ frameborder=”0″ marginwidth=”0″ marginheight=”0″ scrolling=”no”> READ MORE
Tax Missing the target: tax cuts and low to middle income Britain 1 December 2014 by Adam Corlett and Matthew Whittaker and Gavin Kelly This report has two main objectives. First, to assess the main political parties’ leading proposals on tax cuts for the next Parliament. Second, to consider whether there is a different approach to that advocated by the main parties that would better serve low and middle income Britain. READ MORE
Public spending· Economy and public finances In the balance: public finances in the next parliament 25 November 2014 by Matthew Whittaker and Adam Corlett With the Coalition government expected to have delivered around half of its intended fiscal consolidation programme by the end of the current parliament, debates over public finances are set to loom large in the coming election campaign. To date, we have only very broad outlines of the preferred approaches of each of the main parties. … Continued READ MORE
Pay Why 2014 hasn’t been the year of the pay rise 7 November 2014 by Matthew Whittaker and Laura Gardiner A downward shift in the mix of occupations across the workforce towards lower-paying cleaning and caring roles, along with a welcome return of younger and less experienced workers to the labour market, has prevented 2014 from being the year of the pay rise, as many economists predicted. This analysis looks at the impact of changes … Continued READ MORE
Labour market Low Pay Britain 2014 30 October 2014 by Adam Corlett and Matthew Whittaker This report is our fourth annual audit of low pay in Britain. It describes in detail the scale of the problem in the latest year for which data is available (2013) and the people it affects. As with many advanced economies, the British labour market has been characterised in recent decades by a growing polarisation. … Continued READ MORE
Low pay· Pay Turning Point? The minimum wage in 2014 and beyond 1 October 2014 by Matthew Whittaker and Adam Corlett With the National Minimum Wage (NMW) rising on October 1st, this briefing note provides some background by setting out the evolution of the wage since its introduction in April 1999. It looks at the rate’s real value over the intervening period, and its relationship with median pay. It also considers the number of people affected by the NMW … Continued READ MORE
Wealth & assets Hangover Cure: Dealing with the household debt overhang as interest rates rise 24 July 2014 by Matthew Whittaker and Katie Blacklock The UK is entering a period in which interest rates are expected to start rising again – with the first moves potentially coming later this year – having insufficiently dealt with the debt overhang. This leaves the UK economy vulnerable to even modest increases in interest rates. Deconstructing the debt overhang will not be costless, but it is in everyone’s interests – borrowers, lenders, government and taxpayers alike – to adopt a pro-active measured approach rather than simply allowing it to collapse. We favour an orderly and managed dismantling of the debt overhang. This report sets out a series of recommendations for lenders, borrowers and policy-makers to make that happen. READ MORE
Household debt· Wealth & assets· Housing Mortgaged Future: Modelling household debt affordability and access to re-financing as interest rates rise 20 May 2014 by Matthew Whittaker One in ten of today’s mortgagors risk being imprisoned by borrowing deals which are likely to make their repayments unaffordable as interest rates rise over the next four years. Around 770,000 households are both at risk of being ‘mortgage prisoners’ due to a limited ability to switch to better mortgage deals and therefore insulate themselves against future rate rises, and at risk of being ‘highly geared’ where monthly mortgage repayments are eating up at least one third of their disposable income by 2018. READ MORE
Budgets & fiscal events· Public spending· Economy and public finances Have we lost our bouncebackability? 21 March 2014 by Matthew Whittaker In the light of latest OBR forecasts and the 2014 Budget, this paper considers where anticipated growth can come from. In the absence of widely-shared wage growth, can the UK economy grow above trend without a surge in credit? Or, must we resign ourselves to a period of subdued recovery? READ MORE
Living standards The State of Living Standards 11 February 2014 by James Plunkett and Alex Hurrell and Matthew Whittaker Household incomes are set to start rising again in 2015 after six years of decline according to the Resolution Foundation. The findings come in a detailed and authoritative assessment of the state of Britain’s living standards. However, the report from the independent think tank also finds that growth in disposable income for the typical household … Continued READ MORE
Household debt· Wealth & assets Closer to the edge? Debt repayments in 2018 under different household income and borrowing cost scenarios 29 December 2013 by Matthew Whittaker Britain faces the mounting prospect of a household debt crisis as analysis from the Resolution Foundation suggests that a least a million British families, and possibly as many as 2 million, could be spending more than half their disposable income on repayments by 2018 The study uses the latest five-year growth projections from the Office … Continued READ MORE
Pay· Economic growth Growth up, wages down: something has to give 5 December 2013 by Matthew Whittaker In Growth up, wages down we consider the relationship between growth, consumption, investment, incomes and earnings in order to ascertain just how far wage growth might need to rise in order to set the economy back on track. For the purposes of illustration we consider the magnitude of wage growth that might be required to return GDP … Continued READ MORE
Low pay· Labour market· Pay Low Pay Britain 2013 4 September 2013 by Matthew Whittaker and Alex Hurrell Economic downturn has pushed a further 1.4 million employees below the Living Wage – the rate deemed necessary for a basic standard of living. Low Pay Britain 2013 shows that 4.8 million Britons (20 per cent of all employees) earn below the Living Wage – a leap from 3.4 million (14 per cent) in 2009 – at … Continued READ MORE
Household debt· Wealth & assets· Housing Closer to the Edge? Prospects for household debt repayments as interest rates rise 11 July 2013 by Matthew Whittaker The number of families in Britain with perilous levels of debt repayments could more than double to 1.2 million if interest rates rise faster than expected in the next four years and household income growth is weak and uneven. The figures suggest that the ongoing squeeze on households could leave Britain seriously exposed if interest … Continued READ MORE
Budgets & fiscal events· Public spending· Economy and public finances Narrowed Horizons: The fiscal choices at Spending Review 2013 and beyond 20 June 2013 by Matthew Whittaker The government’s plans for deficit reduction have increasingly stark implications for public spending as their deadline draws nearer. While overall expenditure is set to remain relatively flat in 2015-16 (the period covered by the latest Spending Review) the pace of reduction in total government spending is due to increase significantly in the two subsequent years. READ MORE
Budgets & fiscal events· Public spending· Economy and public finances Resolution Foundation analysis of the 2013 Budget 8 April 2013 by Vidhya Alakeson and Alex Hurrell and Matthew Whittaker The Chancellor’s fourth Budget was a relatively quiet affair. While pre-announced changes mean that millions of households will face further reductions in benefit and tax credit receipts from April, the latest financial statement said nothing new about welfare cuts (though it confirmed that departmental spending is set to be tightened still further). READ MORE
Incomes· Living standards· Inequality & poverty Squeezed Britain 2013 13 February 2013 by Matthew Whittaker We now know that the squeeze on living standards will be longer and deeper than projected this time last year. Average wages are not expected to rise in real terms until late 2014 after a period of stagnation and decline. Despite stronger than expected job growth in the private sector, many people continue to work … Continued READ MORE