Jagjit Chadha's picture
Affiliation: 
National Institute of Economic and Social Research
Credentials: 
Professor of economics

Voting history

Assisting Households Facing Rising Energy Costs

Question 3: Should a windfall tax be used to (fully or partially) finance support to households?

Answer:
No opinion or other
Confidence level:
Very confident
Comment:
Like do many industries, we desperately need business investment. It is no different for energy companies, at a time when the supply chain and inventories need building up and we are concerned about energy security. So we should not think of a windfall tax as something the state can just have back. We need to design tax and investment credits to push foward the investment agenda. One could imagine the tax being used as an incentive to invest, if credit were given against specific investments.

Question 2: Which of the following is the best way to address the impact of rising energy costs on household finances?

Answer:
Price caps based on energy use
Confidence level:
Very confident
Comment:
Energy usage is highly correlated with income. So increasing costs with usage is not only progressive but also encourages economies of usage and would pay for itself i.e. with increasing public debt. We do though also need some direct support for the poorest households with large families and/or those in poorly insulated housing. Again Universal Credit can help here. As would the old Child Benefit.

Question 1: Overall, which of the following best characterises how the government’s proposed energy policies will leave the average UK household over the medium term:

Answer:
No better nor worse
Confidence level:
Confident
Comment:
The costs of the cap will increase public debt so over the medium or long term, households may have lower energy costs today but higher public debt in the future. There are some benefits from an element of progressiveness but direct financial support and an extension of Universal Credit would have been better targetted. That inventories and other measures to stabilise supply are absent is a failure. It is also important that there are price incentives to economise of the usage of a scare-pollluting energy source.

Levelling Up Productivity Gaps in the UK

Question 2: Which policies could best help reduce regional productivity disparities?

Answer:
Other or no opinion
Confidence level:
Very confident
Comment:
Again. All of the above. Let uis take these as a set of interventions that if appropriately targetted and calibrated woudl help. The missing factor than is a commitment to delivery of these objectives over the long run, so that firms and households believe that a significant shift productivity prospects will occur and then act accordingly. We ned to create a focal point around a markedly different equilibrium.

Question 1: What is the primary factor driving regional productivity disparities in the UK?

Answer:
Other or no opinion
Confidence level:
Very confident
Comment:
All of the above. A systematic failure to address shortages in capital (human, physical and financial) across the country. As much as anything this secualr failure has resulted from a policy churn in the UK that has focussed on crisis management rather than seeking long run solutions and mechanisms that will tie the hands of successive waves of political leadership. The first report of the UK Productivity Commission is clear on these points: https://www.niesr.ac.uk/publications/productivity-uk-evidence-review?type=uk-productivity-commission

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