Posts Tagged ‘Economy and Society’

Why the ‘Life in the UK’ test alienates new citizens

The UK’s citizenship process subjects immigrants to requirements intended to enhance their identification with ‘British values’. Does the current process do that, or does it exacerbate immigrants’ marginalisation? David Bartram finds evidence in support of the latter: citizenship policy does more to alienate new citizens than it does to facilitate their political integration.

Have you taken the ‘Life in the UK’ test? If you’re already a UK citizen, then of course you don’t need to – but if you did it out of curiosity you’d likely find it very difficult to pass. Some of the questions involve obscure historical dates (in what year did Richard III die?). Even for more meaningful events it is not clear why one should know the year (e.g. re when women gained the vote – an important issue, but why is knowing the date a basis for citizenship?).

Immigrants wishing to gain citizenship (or even permanent residence) have to pass it. The only way to succeed is to study. Now, some of the questions pertain to more useful matters, so perhaps there’s some benefit from the learning one does. And, once you’ve passed, perhaps you’ll feel (on the basis of the knowledge gained) that you’ve earned an entitlement to participate more fully in British public life and core institutions. Academics tend to be critical of the test requirement, but the idea that some good could come of it – possibly even a set of outcomes that looks something like enhanced integration – is not completely implausible.

Propositions of this sort can be tested, with the right data. With colleagues at the University of Leicester (and funding from the ESRC), I have investigated whether becoming a UK citizen (thus, passing the test and participating in a citizenship ceremony) helps foster integration specifically in terms of political engagement. My answer: the core citizenship requirements do more to impair integration in the political sphere than to enhance it. Immigrants who become UK citizens end up less interested in politics, relative to those immigrants who remain non-citizens. That’s a very counterintuitive result; only slightly less shocking is that new citizens do not participate more in civic/public organizations than those who remain non-citizens.

That finding comes from analysis of data from ‘Understanding Society’ (the UK household panel survey). The longitudinal nature of the data helps minimize the prospect of reverse causation (the possibility that it’s a matter of naturalization by already less-engaged people). The analytical sample comprised almost 1000 people who in Wave 1 (2009/10) were not UK citizens. By the time of Wave 6 (2014/15), roughly half of these respondents had gained citizenship – and the core of the analysis involved comparing them to those who remained non-citizens while taking into account their initial conditions including their extent of political engagement.

Now, perhaps it’s somehow misguided to connect the empirical pattern to the specific requirements for UK naturalization. Maybe naturalization led to decreased political engagement even before the introduction of the test and ceremonies. Not a terribly plausible idea, surely. We can’t test it directly: the ‘Understanding Society’ project began several years after the policy was implemented in 2005 (and the predecessor dataset, the British Household Panel Survey, doesn’t enable tracking changes in citizenship status). We do however have earlier research on the question more generally in Europe including the UK – and in analysis of data from 2002-2003 they find that naturalization is generally associated with increased political engagement (in other words, the outcome one would expect). So, perhaps something did in fact change in the UK after the requirements were put in place.

We can then ask: why would the UK citizenship process lead to lower political engagement? The process involves jumping through some meaningless hoops, so it might be a simple matter of annoyance, possibly to the point of fostering alienation. We can however go a bit further, via further consideration of the types of questions the test poses about political matters.

Many of these questions strike me as having something significant in common. There is a clear tendency to ask about the ‘rules of the game’. For example: what is the role of the Whips in Parliament? Or, what is the current minimum voting age? Or, what time of year are local government elections held? Questions like this imply acquiescence to ‘the way things are’: we tell you what the rules are, and you can then play by those rules. There’s nothing about fundamental rights of citizenship – say, the right to demonstrate and to participate in other forms of collective action. The subtext here is a politics of obedience, perhaps even docility. If this is what we tell immigrants about the nature of our politics, who can blame them if they then say: who needs it?  Why bother? Democratic politics is supposed to engage big questions, about justice, fairness, freedom, equality – but through the ‘Life in the UK’ test Britain teaches new immigrants that it’s all just a matter of fitting in and doing what is expected of you.

There is another significant angle to consider. Anne-Marie Fortier argues (very persuasively) that the real motivation behind the requirements of the UK citizenship policy is not to achieve integration for immigrants but rather to alleviate the anxieties of ‘natives’. The policy sends a signal to people worried about immigration: we hear you, and we’re doing something about it. Whether it has any impact on the immigrants themselves is decidedly secondary. One might be sanguine about that idea as long as the impact is merely nil (rather than positive). But if instead the tests and ceremonies have a genuinely negative impact on immigrants in the UK it becomes less feasible to justify an attempt to mollify voters this way.

The original goal of the requirements (as articulated by the then-Home Secretary, David Blunkett) was to foster participation, in hopes of reinforcing ‘social cohesion’. The requirements are plainly not helping to achieve that goal and might be actively undermining it – even for those who succeed in demonstrating knowledge about ‘Life in the UK’ that most ‘natives’ don’t have.


Note: the above draws on the author’s published work in Sociology.

About the Author

David Bartram is Associate Professor in the Department of Sociology at the University of Leicester.



All articles posted on this blog give the views of the author(s), and not the position of LSE British Politics and Policy, nor of the London School of Economics and Political Science. Featured image credit: Pixabay (Public Domain).

Business rates: how reform can benefit both business and public services

Organisations across the political, public, and business sectors see business rates as outdated and problematic. Reforming the system could have profound consequences for business vitality and regional development, while also having the potential for securing the proceeds of local wealth creation, explains Kevin Muldoon-Smith.

Business rates – originally a simple property tax based on a periodical Treasury assessment of rateable value – is being asked by government policymakers to face in multiple directions at once. Business rates are required to be fair, consistent with economic conditions, and to support growth and fair competition. More recently, in 2013, Business rates were also commandeered by Central Government to fund shortfalls in local government funding through the Business Rate Retention System. Local income from business rates has affectively replaced the previous Revenue Support Grant. Business rates are worth almost £30bn per year to the Treasury and are being used to counter the impacts of austerity.

This impossible contortion has resulted in a complex system that is very difficult to follow. Businesses face various multipliers, reliefs and exemption thresholds. In the economic sense, the incidence of the tax also falls negatively on both tenant (in the short term) and property owner (in the long term). While the local government Business Rate Retention Scheme relies on a convoluted web of tariffs, top-ups, safety nets, and levies. It also remains the case that the existing system only rewards business rate growth generated from new property development. Growth derived from existing property is stripped out during the national revaluation exercise – ignoring the value created by local regeneration. This balancing act creates a sense of pity for the business rate system: by asking it to serve so many agendas, it serves none.

Any change in favour of one interest has the knock on impact of undermining the other. For example, the decision by Central Government to maintain a consistent or increasing Business Rate Multiplier following national property revaluation has helped retain more business rates for public spending purposes. Concurrently the call for small businesses to be removed from the business rate system all together has resulted in lower tax rates, rate relief, or a tapered arrangement. However, the consequence is that this higher business rate burden is shouldered by an ever-decreasing number of businesses with larger floorplates. To put this in context, following the 2000, 2005, and 2010 national revaluation exercises, the Business Rate Multiplier was reduced to between 41.6p and 42.2p in the Pound. Following the 2017 revaluation exercise, the multiplier was only reduced to 47.9p and quickly increased to 49.3p in 2018 – one of the highest levels on record.

Business rate reform

A lot of the press attention for business rate reform falls upon the retail sector. However, although clearly an important consideration for retailers, Business rates are not necessarily the cause of market disruption in this sector. Business rates are often relatively high for retailers because they have paid a premium for centrality of location. Rather, the sector is currently beset by myriad structural, macro and micro concerns, which magnify the cost of business rates.

Consequently, business rate reform should not be led by one agenda. Instead, the opportunity should be taken to unite the various considerations and priorities that are reliant upon or demand a reformed commercial property tax in England. This will then provide the opportunity to work backwards to understand how a new system of property tax could be implemented. These considerations and priorities include:

  • Being responsive to economic conditions and incentivising investment in property and business;
  • Being sensitive to the new world of work that favours hybrid and online business models;
  • The need for transparency, legibility and simplicity;
  • Sympathy for how business rates fall on various property sectors and locations – for example retail, leisure, office and industrial, all of which experience property tax in different ways and locations;
  • Tackling the perversity inherent in empty property rates that at times rewards vacancy more than occupation and has driven a sub-industry in Empty Property Rate avoidance techniques;
  • The demand for local government financing which is only projected to increase as society lives longer;
  • The need to capture the value created by public spending on physical, social and knowledge infrastructure in local areas.

In facing up to the demand for reform, there is a concurrent interest in Land Value Tax as an alternative arrangement. In contrast to business rates, Land Value Tax is based on location and is levied upon the value of land (with or without in situ property). The central contention is that the value of land is defined by what is happening in the immediate location and wider region. For this reason, Land Value Tax is considered progressive because it captures value invested by society in a given location and potentially aids current calls for local wealth building and inclusive growth. This certainly remedies one of the central concerns with the Business Rate Retention Scheme, that any value increase due to local investment is stripped out during the periodical national revaluation exercise – known as the ‘wash through.’

However, England should be wary of viewing Land Value Tax as a panacea for concerns with business rates. A great deal of land simply has no value and demands a certain degree of investment for development readiness. In addition, any reduction in tax may capitalise into higher rents as property owners price in the change. Concurrently, it is not clear how Land Value Tax would deal with the new world of digital platforms that do not have physical footprints, nor the dynamic reality of commercial business that increasingly must switch between use in quick succession – necessitating repeated valuation.

A very English compromise

The economic and ethical argument for Land Value Tax is relatively well made. However, the practicality of moving to this system is not straightforward. It would require massive change to the English institutions of tax, another national revaluation exercise (for residential and commercial land) using a new method of site appraisal (although other countries use automated methods) and the development of a new valuation skill base. Perhaps the biggest obstacle will be political. A switch to Land Value Tax would shine a light on the deeply ingrained practice of wealthy property owners who may not take kindly to disturbance.

The eventual reality may be a compromise. For example, a semi-permanent transition that combines elements of land value, property, and turnover related tax. This balancing act would be similar to the split-rate tax (where land is taxed at a higher rate than property) seen prominently in North America but also include elements of business gain not easily captured in bricks and mortar – for example a Digital Sales Tax. The Digital Sales Tax, announced by Philip Hammond in the 2018 Budget aims to capture value from firms that shift sales and profits between administrative jurisdictions.

The situation is multi-faceted and therefore calls for a partnership based solution that brings together business, property owners, the various tiers of government, and those administering tax. The situation must not be distilled into respective political agendas or departmental budget silos. Nor should it be examined through simplifying principles of economic supply and demand or reduced to cash flow, expenditure ,and finance settlements. Rather cross party consensus must be found that views land and property based tax through a dual prism of business profitability and the payment of local public services.

Any solution must capture the value held in the new world of work and recover the investment put into National and Industrial Strategies and the bottom-up civic efforts of local communities, towns and cities. Such a system reaches into the institutional fabric and identity of local government and how, as a nation, we support, reward and recapture investment in business and economic development.


About the Author

Kevin Muldoon-Smith is Lecturer in Built Environment Adaptation and Investment in the Department of Architecture and Built Environment at Northumbria University.




All articles posted on this blog give the views of the author(s), and not the position of LSE British Politics and Policy, nor of the London School of Economics and Political Science. Featured image credit: Pixabay (Public Domain).

Austerity in English local government: why collaboration was not the answer after all

To cope with austerity, local councils were encouraged to pool resources and share back-office administration (e.g. legal counsel and internal audit). Was this type of collaboration worth it? Thomas Elston and Ruth Dixon find no evidence that sharing administration or tax services has helped councils manage budget cuts.

Whether by historical standards, or compared with other parts of the public sector, the financial settlement awarded to English local government in 2010 was undoubtedly tough. As the Coalition Government sought to manage a perilous fiscal situation through a combination of modest tax rises and far more significant spending cuts, grants to councils were reduced in cash terms by 28% over four years, amounting to a real-terms cut of 40%. Faced with limited ability to make compensatory increases in local taxes, and growing demand for public services following the recession and long-term demographic changes, local government finances and services were at serious risk.

But all was not lost. Councils could, the government urged, alleviate some of the pressure by working collaboratively to pool resources and overcome diseconomies of scale. Indeed, for a number of years, Whitehall had encouraged greater “sharing” of services across council areas – as is widely practiced in Europe and the USA, but not typically in England. By 2012, the government had published guidance, Fifty Ways to Save, which ranked shared services first out of 50 promising examples of “sensible savings.” And while not known for enthusiastically embracing central government reform edicts, on this occasion English councils acquiesced. By 2016, over 75% of local authorities (including nearly 90% of lower-tier district councils) were party to one or more arrangement for sharing back-office administration (HR, audit, legal services, etc.) – an area of council activity widely regarded as among the easiest and most-obvious of candidates for consolidation.

Of course, this style of public management reform was very much in vogue in Britain and internationally at the time. What is more, scores of top-performing multi-divisional firms had already moved to shared back-office operations and, reportedly, achieved savings of 20-40%. A significant advisory industry of consultants and management “gurus” emerged to help public managers replicate these remarkable successes. And yet, as so often is the case, the pace of reform far outstripped that of evaluation. Independent, quantitative evidence of the financial impact of sharing (in the public or private sector) was almost non-existent (and did not support the alleged benefits), while qualitative evidence focused on reform processes rather than outcomes. Consequently, at a time of great resource scarcity, policymakers took a gamble in investing so heavily in this unproven fix.

So, was collaboration part of the answer to austerity? Did sharing back-office administration help councils to manage “the worst financial settlement in living memory”? To investigate, we performed multi-wave change-score regression analysis on organizational and financial data from the 317 (out of 353) English local authorities for which sufficient financial data was available during the period 2008-16. Our focus was on changes to councils’ administrative spending relative to frontline spending – known by organizational researchers as “administrative intensity”. Councils that share back-office services were identified from the Local Government Association’s “Shared Services Map” dataset, which we coded for the level of participation in such collaborations. To allow for a realistic lag period between the adoption of the reforms and any observable savings, only shared services established before 2015 were included in the analysis.

We found that administration costs fell on average relative to total spending across the period 2008-2016. The size of this reduction varied by council type, with, in particular, district councils showing a greater relative fall than other types of council (though from a much higher baseline). However, there was no evidence of a relationship between the degree of participation in shared services and the change in relative administration costs, either for all councils taken together or for upper- and lower-tier councils separately, as demonstrated by the near-horizontal best-fit lines in Figure 1 below. (This finding was robust to the inclusion of demographic control variables, and also to various definitions of the dependent variable based on staff and/or non-staff costs).

Figure 1. Increase or decrease in administration/total costs for shire districts (SD) and other council types for different levels of shared back-office service participation. Figure from Dixon and Elston 2019.

We next tested whether reform outcomes varied by type of administration shared (clerical or professional) and by diversity of frontline activities undertaken by individual councils and across partnerships (“structural complexity”). Contrary to expectations, we found no evidence that lower structural complexity improved reform performance. And sharing of labour-intensive professional (rather than automated clerical) services actually showed a small but significant positive relationship with administrative intensity. This likely reflects the limited potential for scale economies in activities that are not capital-intensive, combined with the costs of coordinating multiple partners.

In a follow-up study, we re-tested our main hypothesis on an analogous field of activity – council tax collection. As shire districts are the only type of council that participated in shared tax services to an appreciable extent (44 councils, equating to 22% of shire districts), the analysis only includes that type of council. Again, we found no significant relationship between participation in sharing arrangements and the change in council tax collection costs per dwelling, as demonstrated by the near-horizontal best-fit line in Figure 2 below.

We also tested for changes in the quality of tax collection services, in terms of council tax collected as a percentage of the maximum collectable amount. If sharing did not improve efficiency, perhaps it improved effectiveness? In 2016, collection rates ranged from 90.7% to 99.5% for all local authorities, and 94.1–99.4% for district councils. There was no significant change from 2009 to 2016 for all councils, or for districts alone. District councils that shared tax services had slightly worse collection rates in 2016 than those that did not: an average of 97.6% for participants versus 98.0% for non-participants, p=0.02, though this is clearly not a material difference. Tax collection rates deteriorated by an average of –0.19 percentage points from 2009 to 2016 for participants and –0.03 percentage points for non-participants, a non-significant difference (p=0.1).

Figure 2. Increase or decrease in gross council tax collection costs per dwelling versus participation in shared tax collection services (district councils only). Figure from Dixon and Elston 2019.

Overall, then, we found no evidence that sharing either administration or tax services has helped councils to cope with the budget cuts brought by austerity. Nor does our research suggest that imposing strict “scope conditions” on sharing arrangements – limiting participation to organizations with high baseline administrative intensity; only forming partnerships of low structural complexity; and only sharing capital-intensive (technology-based) functions – is a promising way forward.

While we do not exclude the possibility that individual sharing arrangements can and have produced efficiencies for their participant councils, great caution is needed by those advocating and implementing this type of reform.


Note: The above draws on the authors’ work published in the Journal of Public Administration Research and Theory and Public Money and Management. The analysis was funded by the British Academy and Leverhulme Trust.

About the Authors

Thomas Elston is Associate Professor in Public Administration at the Blavatnik School of Government, University of Oxford.




Ruth Dixon is Research Fellow at the Blavatnik School of Government, University of Oxford.



All articles posted on this blog give the views of the author(s), and not the position of LSE British Politics and Policy, nor of the London School of Economics and Political Science. Featured image credit: Pixabay (Public Domain).

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