Like many others I’ve been watching the debate about energy company profits and price rises. I find myself disillusioned with the whole thing; I feel helpless and outside of the discussion; I don’t feel I have a voice and neither do the people I work with. Individuals are of little relevance or consequence – it’s about the wants of corporate finance, majority shareholding institutions concerned more with money than the needs of people. Those on the margins don’t matter, dividends do!

Whilst politicians consider whether levels of profit are too high or if it should be made easier to switch supplier, what I and my colleagues know, and can evidence, is that many people are suffering real hardship. One of the services we run at Birmingham Settlement is a debt advice service and the numbers of people coming to us for advice has spiralled this year. Yesterday we had 53 people through our door seeking financial help and advice – the largest number we’ve ever had in a single day.

I would like politicians and energy company CEOs to spend time with some of the people who through circumstance beyond their control cannot afford the fuel needed to heat their homes or cook their food. We work in partnership with others such as food banks to provide support where it is most needed and I’m afraid a response we are increasingly hearing from clients is ‘there’s no point, I can’t afford the fuel to cook the food’.

I was involved in a discussion a few days ago about whether the UK was the 5^th, 6^th or 7^th largest economy in the world – it seemed to depend on which report you read; the discussion went on to whether it was right for people to be limited to three food parcels per family, irrelevant of circumstance. I was amazed that the idea of food banks now seems to be an acceptable concept, everyday language – is it really acceptable in 2013 that the second largest city in one of the biggest economies in the world has such a problem; that its own citizens cannot cook the contents of a food parcel because they have no fuel?

I am reminded of Maslow’s Hierarchy of Needs – the most basic human life needs include food, drink, shelter, warmth – how on earth can we expect people to grow and prosper if they can’t cook a meal?

Winter is almost on us and for too many this means additional hardship as they will not be able to meet the costs of soaring fuel bills; they will no doubt face the consequences of not being able to contribute to the billions handed out in dividends to the privileged few.

At Birmingham Settlement we have suggested a practical measure that could really make a difference. We are asking the energy companies to give every household access to an hours’ supply a day irrespective of debt and personal circumstance. This means if prepayment meters have no credit fuel would still be available for one hour everyday – we suggest between 12 noon and 1 pm. Energy providers (electric and gas) have the technology to make this happen. The residential supply of water cannot be legally disconnected, where as fuel is increasingly disconnected; and to the poorest families in our society. This is wrong! Profit making energy companies need to show social responsibility – support society by putting more back, and now!

Birmingham Settlement has begun an e-petition to ask the Government to legislate for the basic human right for every household to be able to cook a hot meal each day under a Fuel for Food campaign – you can support us by signing the e-petition here.

Migration and productivity: employer’s practices, public attitudes and statistical evidence found three main reason for why employers recruit from outside the UK; when the supply of skills from inside the UK is deficient, to recruit high skill levels which are in short supply across the globe and top complement the skills of non-migrants.

This stands in contrast to the perceptions of focus group members who tended to focus on low skilled, low paid Eastern European migrants when think in migrant workers in the UK.

Employers believed that the varied experiences and perspectives that migrants can bring to the workplace create teams with different strengths and more dynamic workplaces. This was accepted by the focus group participants. However, both participants and employees could see the challenges of diverse teams, particularly when language skills and cultural understanding were deficient, but these were considered to be minor issues with positives of diverse teams outweighing the bad.

An analysis of data between 1997 and 2007 found that the number of migrants working in more sectors has increased, and migrants tend to be more educated and work longer hours than those born in the UK. There was a positive correlation between the share of migrants in region-sectors and labour productivity as well as a significant positive association between increases in the employment of migrants and labour productivity.

Read the full report online here.

Last week’s spending review brought little positive news for key departments and affected individuals; the prison budget was were reduced by £180m, a 6% cut to the transport resource budget has been proposed and civilian posts on the armed forces have been cut. Some specific components of the review have great implications for charities and those rely on in their services, notably cuts to the welfare budget, local government spending and the Charity Commission’s budget, meaning that times will only get tougher for the sector.

The review sees a 10% cut to local government spending making it particularly hard hit. This comes in addition to the previous 33% real terms cuts to council budgets directly affecting their service provisions. However, Local Enterprise Partnership (LEPs) can bid for funding from a local growth fund of £2bn (lower than the £70bn recommended by Lord Heseltine in his review of economic policies), a move declared to be: “a welcome step in the right direction” by Alex Pratt, chairman of the Buckinghamshire Thames Valley LEP.

Changes to the welfare budget will likely have the greatest immediate impact on many beneficiaries of charities working with vulnerable communities. A new cap will be introduced to the welfare system affecting housing benefit, tax credits and disability benefits. Alongside the welfare cap comes a cut to the benefits of claimants who do not speak English unless they take language courses and a ‘temperature test’ for winter fuel allowance preventing pensioners living in warm countries from claiming it.

Dubbed the ‘Wonga Week’ by some, the waiting period before jobseekers are able to claim benefits will be extended to seven days from the previous three, which has been perceived as a change that could encourage greater take-up of payday loans. Payday loans have received heightened attention due to an increased reliance on their services, alongside and increase in the sheer amount of debt stemming from payday loan. On average, the average amount owed on payday loans has increased by £400 to £1657.

Particularly in light of a greater reliance on food banks and increased payday loan debt, the consequences of the welfare cap are potentially significant for both charities and their beneficiaries; as a result, analysis of this will soon be published by NCVO.

The Charity Commissions’ budget will be reduced from £21.4million to £20.4million and the department for Culture, Media and Sport will be cut by 7%.

The resource budgets for the Treasury and the Cabinet Office will be cut by 10%, whilst the Office for Civil Society will retain its funding of £56m and additional support will be provided for the National Citizenship Service.

Issues arising from cuts affecting the sector are twofold, as cuts to welfare and local government spending may lead to a further increased demand for their advice and support services, whilst the Charity Commission faces a direct cut to its funding, potentially reducing it’s ability to support and champion the sector. In the coming weeks NCVO will be working to build a fuller picture of the impact of these changes on voluntary and community organisations.

Voluntary sector irrelevance or key to a successful and inclusive economy?

When we saw the “new ideas in economics” strand of the Barrow Cadbury Trust’s Poverty and Inclusion programme [now the Resources and Resilience programme], we were surprised, and pleased. It’s long been an ironic state of affairs that charitable trusts have shown limited interest in exploring the systems by which we organise our livelihoods that cause the social problems the trusts exist to solve.

To us, it was an opportunity to research the assumption at the heart of Localise West Midlands’ mission: that in a more localised economy, more people have a stake, which redistributes economic power and resilience, reducing disconnection and inequality. Not, perhaps, a ‘new’ idea, when you consider 1960s Schumacher – but newly in need of exploration in the face of growing inequality and economic failure.

The chasm between charity and economic development thinking is mutual. There are plentiful ideas around what we have been calling community economic development: social inclusion as CSR, community-led job creation, co-ops and social enterprises, local procurement initiatives. To many economic development practitioners these are very nice projects that go into a little box labelled “voluntary sector” and have little to do with the real economy, which is about big sites, tax breaks for multinational corporations – “prostituting ourselves for inward investment” as the Centre for Local Economic Strategies‘ Neil McInroy colourfully puts it.

Our project, Mainstreaming Community Economic Development, is an attempt to take localised economies out of this little box. Firstly, to see the social potential not only of voluntary sector initiatives with social objectives, but also of private sector activity that is locally controlled and based, where the community’s participation is as owners, investors, purchasers and networkers.

And secondly to challenge what is given economic priority. Given the benefits of localised approaches, shouldn’t we try to integrate them better into our economic interventions? Shouldn’t they get a fair crack at subsidies and support structures? Shouldn’t we use cost benefit analysis to see which types of activity most maximise the returns to the local area and to those in disadvantage? It doesn’t fit into a little box, it’s just a consideration in all good decisions.

Localised economies are more successful and inclusive

In its first stage, a review of the literature evidence for the benefits of localised economies, we found good evidence that local economies with higher levels of SMEs and local ownership perform better in terms of employment growth (especially disadvantaged and peripheral areas), social inclusion, income redistribution, health, civic engagement and wellbeing.
Such economies also support local distinctiveness and diversity, which we see as positives because of their contribution to economic resilience, economic options to suit a diversity of people, sense of place and belonging, area quality, added interest and richness of experience.

Absentee landlords vs local commitment

We found that a local economy largely controlled by ‘absentee landlords’ – distant private and public sector controllers with little understanding of the local area – is a recipe for economic failure. Locally-inappropriate decisions and ‘footloose’ businesses leaving the area for better economic conditions seem to combine to weaken local businesses and create a self-reinforcing cycle of decline and exclusion.

Many of our private sector case studies showed local commitment. From Birmingham Wholesale Markets to renewable energy consultancies, they demonstrated ‘enlightened self-interest’ in understanding their interdependency with local communities. Their role in an inclusive economy can’t be underestimated. If only their voices were louder than those of absentee landlords in today’s ‘pro business’, London-centric political environment.

Mainstreaming and scaling up localisation

Informed by this and our case studies we set out proposals for a strategic approach centred on local supply and demand chains, participation and control. Taken strategically, every regeneration project, every economic development decision, every spatial plan, would be based on maximising benefit to and ownership by local people, and particularly its excluded communities.

While much can be done locally, to enable CED to scale up requires national change to decentralise economic and governmental power and make changes around policy, support services, subsidies, tax, banking, infrastructure and measures of success, creating a level playing field for indigenous economic activity.

Politically, it’s helpful that localisation approaches are inherently pro-business, but also respond to public concerns over the concentrations of wealth and power that created the 2008 Crash. As we take it forward, civil society interest, international examples like Mondragon and careful use of language may help this agenda to stay out of that little box long enough to contribute towards a better economy.

The UK’s minimum wage is to rise to £6.31 for adults and £5.03 for 18-to-20-year-olds with business secretary Vince Cable stating that “Nobody in the country should be paid less than the minimum wage”. Some commentators have raised the question of whether the minimum wage keeps up with the cost of living and this question is an interesting one, as despite the number of times it has been raised and words expended asking it, the answer is quite simple: alas, no. Since 2009 minimum wage increases have regularly fallen behind the rate of inflation leaving minimum wage earners paying more for goods and services without their wages rising in line with this. Vince Cable is just in saying that there is a wage that nobody in the country should be paid less than, but is this wage a minimum wage?

When we speak of the cost of living, this is often within the context of the welfare state and whether benefit payments are too great or too small. However, in-work poverty is common with many simply not earning enough to provide for themselves and their families. This is a problem that the younger sibling of the minimum wage, the living wage, looks to address.

When advocating the living wage, there is a tendency to separate between moral and economic benefits, however, any discussion should give consideration to both. Ensuring employees are paid a sum that doesn’t leave them living in poverty or on the brink of poverty is the ethical thing to do and is one of the soundest means of “making work pay”. Since the inception of the Living Wage Campaign in 2001, 45,000 have been lifted out of poverty as a result. More than just a concept that politicians pay lip service to, the living wage has elicited change in the way its advocates intended, and with the Trust for London estimating that all low paid workers in London alone being paid the living could save the government £823 million per annum, the economic benefits are apparent.

Young workers are much more likely than their older counterparts to be working for a low wage. In addition to this, there is the expectation that many young people work for no pay as a precursor to finding a paid position. Whilst youth unemployment continues to rise, in many sectors young people are pressured to take on unpaid positions simply to get their foot in the door.

As an intern I’m highly aware of the trope of the suffering unpaid intern, forever bearing a heavy load of work that should be assigned to a paid staff member. Tanya De Grunwald of Graduate Fog has waged a war against this calling out organisations that take on unpaid interns for positions that should be filled by paid staff. One firm that has incurred her wrath is French fashion house Balenciaga for their request for unpaid sales assistant interns; a position involving all the features of working as a sales assistant with none of the financial returns. An option only available to those financially stable enough to generate no income for a prolonged period of time.

In a period where youth employment prospects are particularly low, many see these unpaid options as a necessary stepping-stone. At first glance it may seem counter-intuitive to spend four weeks working as a sales assistant for no pay, but the opportunity to say that you’ve worked for a high-brow fashion house may be just what someone wishing to crack the seemingly impenetrable world of fashion is looking for.

What this says about employment prospects is sad, at a time when youth unemployment is rising; numerous organisations take advantage of a desire for that coveted concept – experience.

An adoption of the living wage for all workers including interns is not something that will happen overnight, but whilst it is accepted that some people are paid less than they need to survive on, or nothing at all, the problem of in-work poverty will continue to increase and some sectors will continue to have barriers to entry which exclude those from a lower socioeconomic background. Organisations becoming living wage employers begin to solve these problems and in doing so, they step closer to becoming ethical workplaces that practise equality and diversity through genuinely facilitating inclusion.