Commission calls for ‘a new economic settlement’

An independent commission has warned the British economy is not working and needs ‘fundamental reform’.

The IPPR Commission on Economic Justice – whose members include the Archbishop of Canterbury (pictured) – has published a new report which warns real wages and the living standards of tens of millions of people in Britain have stagnated over the last decade.

The report also states young people have seen their life chances deteriorate and the economic gulf between London and the South East and the rest of the country has grown wider.

Instead of simply redistributing the proceeds of growth, the economy should be ‘hard-wired’ for justice, so that fairer outcomes are built in to the way it works.

Among the report’s many recommendations are an immediate increase of around £1 an hour in the minimum wage to the Real Living Wage, and a requirement for all those on zero-hours contracts to be paid 20% above the higher rate, along with a package of measures to revitalise trade unions.

The report also calls for a  new ‘economic constitution’ for the UK, devolving more economic powers to the nations and regions through new ‘Economic Executives’ for the North, Midlands, South West, and South East of England,

‘For decades the UK economy has not worked as it should, with millions of people and many parts of the country receiving less than their fair share,’ said the Archbishop of Canterbury, Justin Welby.

‘The widening gulf between rich and poor, and fears about the future among young people and their parents, have damaged our nation’s sense of itself.

‘Our report shows that it doesn’t have to be like this. By putting fairness at the heart of the economy, we can make it perform better, improving the lives of millions of people. Achieving prosperity and justice together is not only a moral imperative – it is an economic one,’ added the Archbishop.

IPPR Director and Chair of the Commission on Economic Justice, Tom Kibasi, added: ‘The economy belongs to us all and this report shows that we can change it so it works for everyone. We can bridge the gap between the country we are and the country we would like to be.

‘The Commission has reached a remarkable agreement on a new direction for the UK economy. Our proposals are unashamedly ambitious. Taken together, they offer the prospect of the most significant change in economic policy in a generation. We aim to spark a national conversation on the economic change this country so desperately needs.’

To read the full report, click here.