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Why a new definition of prosperity and radical ideas are needed to build back better post-pandemic and how to achieve this

Using GDP alone to determine prosperity is inadequate and misleading, leading policy makers to draw faulty conclusions about levels of prosperity and appropriate interventions.

Published: Friday 12 November, 2021



Image: Dimitry Anikin from Pexels


As we emerge from the shadow of COVID-19, governments around the world face an unprecedented triple threat of global recession, a degrading environment and enduring and widening inequality. The pandemic has exacerbated international, national, and regional disparities, from access to digital services and housing, to education and health outcomes. Traditional macro-economic approaches to building prosperity have failed.

Politicians and policymakers have a choice to make. They can either continue with the decades-old orthodoxies that dominate social, political and economic policy, or they can take inspiration from radical thinkers such as William Beveridge and Beatrice Webb, whose work influenced policymaking and prosperity in the wake of the last global catastrophe of this magnitude, and implement bold, courageous new policies that build prosperous futures for all.

It’s clear we need a radical rethink of how we understand prosperity, how we think about the economy and what it does for people and planet, which has been the UCL’s Institute for Global Prosperity’s (IGP) mission for the past five years — to research and redesign prosperity for the 21st Century.

Based on an extensive research programme, documented in ‘Rebuilding Prosperity: A Report for Change, and carried out in partnership with citizen scientists and local communities in east London, we have now identified what prosperity means to people in today’s society and how community led policy-making can shape effective and sustainable place-based prosperity.

Central to this is the pioneering development of the UK’s first citizen-led Prosperity Index, a new methodology for defining, measure and acting to create shared prosperity. Using GDP alone to determine prosperity is inadequate and misleading, leading policy makers to draw faulty conclusions about levels of prosperity and appropriate interventions. But this new index is based on the theory that by sharing knowledge and trying radical new approaches, more innovative policy options that are targeted to specific local communities and effective at improving quality of life will open up. Without it, it’s impossible for policymakers to map successful pathways to prosperity for different places.

From initial implementation of this methodology in east London, UK, we now know that secure livelihood is the most important factor to people’s prosperity in the communities there. People also explained how livelihood security depends on several overlapping factors: good quality work that provides a reliable and adequate income; affordable, quality housing; access to public services; and social and economic inclusion.

Ultimately, measuring prosperity through lived experience enables stakeholders such as NGOs and local governments to more effectively use their resources to respond to people’s needs. And most importantly the prosperity index can be used as a tool for monitoring and evaluation of policy goals by the citizens to hold other stakeholders to account.

Another key call to action identified from our research is the need for welfare systems that actually work. In the UK, our welfare system was struggling to respond to the challenges of the 21st Century, long before COVID-19 struck — from the social care crisis to the climate emergency to the unequal impact of new technologies and automation on jobs and wages. As the pandemic has unfolded, the need for a new concept of universality that can effectively reduce inequality and rebuild prosperity has become ever clearer. We need a welfare state that reflects the lived experience of the 21st century, acknowledging that health, education, employment, and poverty are not issues that are experienced in isolation but are inextricably linked.

An effective welfare system must be expanded to include new services essential to our modern lives, such as child and adult care, food security, digital access and transportation. This is what we have called Universal Basic Services (UBS). UBS is universal provision of a public services to enhance people’s capacities and capabilities to respond to today’s challenges as well as future challenges.

From a UK perspective, if we start now, by the time of the next general election in 2024, every city and area of the UK could have its own secure livelihoods strategy; its own citizen-led Prosperity Index and its own pathway to levelling-up based on local experiences; and Central Government could have scoped and begun to deliver Universal Basic Services to provide the framework for successful local interventions.

We must rebuild the connection between macro-economics and the socio-economic realities that citizens live, and struggle, with daily and which differ across communities. We can’t rebuild Prosperity in the 21st Century based on ideas from the early 20th.

We have a moment of opportunity here to bring permanent, positive change to global society and communities — let’s not waste it.


(This article was published by Medium. Please read the whole article HERE.)



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