As the Chancellor’s autumn statement approaches, all eyes turn to economic policy, but does the public have enough of a voice? Drawing on the recently released results of the Citizens’ Economic Council on the Cost of Living project, Christopher Holmes argues that there is potential to improve.
At a recent event held by the Policy Institute at King’s College London, the former Bank of England Governor, Mark Carney, suggested that citizens’ assemblies could be an important part of the process of forging consensus on difficult policy problems. Given the cost-of-living crisis and a current widely held sense that the British economy is in terminal decline, do citizens’ assemblies have something to offer on economic policy?
Firstly a quick primer: citizens assemblies, along with citizens’ councils and juries, are examples of deliberative democracy, which gather small groups of citizens, randomly selected from the population but controlled for various characteristics (age, gender, location, income etc.) to get a good spread of public opinion. Pitched as a compliment to representative democracy – i.e. voting for parliamentarians to represent citizens’ views – the emphasis in deliberative approaches is on providing high quality information, diverse arguments, access to experts and plenty of time to discuss with fellow citizens from all walks of life.
Such approaches have become popular recently, with the Irish and Scottish Parliaments, for example, both commissioning large-scale citizens’ assembly projects to produce recommendations on contentious issues from constitutional change to abortion policy and climate change.
The case for greater use of deliberative approaches in the economic policy space is, on the face of it, strong. Whilst economic issues are often at the top of citizens’ minds when they cast votes at the ballot box, few people understand major economic concepts like inflation, unemployment and GDP, meaning that many are unable to accurately judge how well the government is performing. On top of this, information about the economy available in even the most established outlets can be misleading on the actual choices facing government, and faulty metaphors can end up shaping public opinion in unhelpful ways.
Responding to these issues, King’s College London and Ipsos recently ran a project designed to test the potential for deliberative approaches in economic policy. The Citizens’ Economic Council on the Cost of Living gathered 39 citizens from across the UK to discuss a variety of difficult policy problems arising from the cost of living crisis, from energy bills support and windfall taxes through to long-term investment in the UK economy. Citizens were given access to a variety of leading experts and were presented with a range of simulated policy scenarios, encouraging the participants to confront the hard trade-offs that government actually faces when deciding how to tax and spend.
The topics were challenging and technical, but the participants rose to the task, offering unique and nuanced recommendations. Some of these recommendations centred on the way politicians and economists engage with the public. Many participants strongly valued the chance to hear good quality information and diverse perspectives about the economy. Most felt their views had changed considerably over the course of the process in response to the information and scenarios provided for them.
Other recommendations related to the balance of taxation and spending. Here, participants tended to support relatively progressive policy packages. For example, when asked to choose between a crisis-response spending package that provided similar amounts of help to all households via energy bill credits and VAT cuts, and a second package that directed more help through the benefits system instead, the latter was the consistently favoured choice. For many participants, the distributional impact of different types of tax and spending were surprising, and the project allowed them to really get to the bottom of how such policy changes affect different citizens.
Participants also strongly emphasised the need to think long-term about the UK economy. The words ‘what about the next crisis?’ came up many times, and participants were on the whole supportive of a variety of long-term public investment schemes presented to them, even when the risks and consequences for public finances had been explained. The basic case that public investment could improve the nation’s fiscal position long-term was generally persuasive.
The project demonstrated that deliberative approaches do have something to offer on economic policy, especially on long-term priority-setting, but the question is whether politicians and policymakers will adopt them. The Bank of England has been forward thinking on public engagement, convening regular citizens’ panels to discuss economic issues. But participants in that scheme are self-selecting, and it’s not clear to what extent citizen input influences decision-making. In contrast, the Scottish and Irish assemblies are tied into parliamentary processes. By comparison, Westminster in general, and the Treasury in particular, are lagging.
A ‘gold standard’ economic council would have democratic legitimacy based on random selection of participants and would have clear links to decision-making, either as part of the policy consultation process or via required parliamentary or government departmental response. At a time when UK citizens place a relatively high degree of trust in each other, and a relatively low degree of trust in the politicians governing them, the institutionalisation of deliberative approaches might be just the thing to restore confidence in policy process.
By Dr Christopher Holmes, Senior Lecturer, International Political Economy.
To find out more about the project, you can read the final report here.