 | Housing Secretary Michael Gove announced a “long term plan for housing” this week, while Prime Minister Rishi Sunak committed to “step in” to sort out London’s housing crisis. These forthright declarations, however, are less impressive in detail than headlines.
The announcements contained many individually worthy ideas. This includes making it easier to convert commercial buildings into homes and highlighting Mayor Sadiq Kahn’s unnecessary obsession with maintaining industrial land in inner London (despite market signals that this should be used for housing). But the individual measures do not amount to anywhere near enough to fix Britain's housing crisis. There was also the usual unhelpful rhetoric (brownfield good, greenfield bad).
The UK’s planning system remains excessively command and control – a 1940s socialist relic. It is an outlier among developed countries in its sheer restrictiveness. It is highly inflexible and takes no account of market signals, while failing to deliver good design and critical infrastructure. Instead, the system churns out vast quantities of pointless petty requirements. A recent typical application for just two homes in Norfolk was 29 documents and hundreds of pages.
The abolition of our 1947 Town and Country Planning Act might be politically impossible. But a market-led reorientation of the planning system could work – to increase the flow of land, allow people to upgrade their homes, reduce bureaucracy and counterproductive rules, and make it easier for people to build and commission their homes (again, the UK’s tiny self and custom build is an outlier). If the government is not prepared to deliver genuine supply-side reform, it could at least join up immigration and housing policy, requiring more land for homes if it won’t reduce migration.
Housing policy matters. The failures generate hostility to markets among younger (and increasingly older) people – despite government failure driving the housing crisis. Sadly this week’s announcements will do little to alleviate suffering or anger. |
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| Alex Morton
IEA Director of Strategy |
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| |  | Alcohol AdvertisingWhat does the evidence show?
This week, the IEA published ‘Alcohol Advertising: What does the evidence show?’, authored by Head of Lifestyle Economics Christopher Snowdon. It finds that there is a lack of empirical evidence that banning advertising reduces consumption: The Scottish government has consulted on severely limiting alcohol advertising but recently announced it would go “back to the drawing board” on the proposal. The economics literature shows that advertising can increase the sale of individual brands but, in mature markets, does not increase aggregate sales of the product type being advertised. In 2014, a Cochrane Review – widely considered the ‘gold standard’ of evidence in health policy – found that “There is currently a lack of robust evidence for or against recommending the implementation of alcohol advertising restrictions.” For example, three Canadian studies, based on advertising restrictions in British Columbia, Manitoba, and Saskatchewan, found no effect on consumption. A 2010 cross-sectional study from 17 OECD countries between 1975 and 2000 similarly found “advertising bans do not reduce alcohol demand”. Econometric studies examining the relationship between expenditure on alcohol advertising and per capita alcohol sales using objectively measured variables have consistently found no association. A few randomised controlled trials have examined whether exposure to alcohol advertising acts as a cue to drink alcohol in the short term. They have produced mixed and contradictory results. Studies favourable to restrictions have tended to ignore confounding factors or been replete with biases – like cultural differences, measurement problems, and selection and recall bias. For example, studies that show heavier drinkers report viewing more alcohol advertising are likely examples of ‘reverse causation’.
Following the publication of the report, the Scottish government signalled that the advertising ban would not be going ahead. A Scottish Government spokesperson said:
“As the First Minister has said, he wholeheartedly supports the aims of the recent consultation on alcohol advertising – particularly to reduce the harm caused by alcohol to young people – but is keen to take a fresh look at the issue, balancing that aim with careful consideration of the impact restrictions may have on business.” | | | Dozens of UK and Scottish news outlets covered the report, including The Times, The Daily Mail, The Sun [Pictured], The Scotsman, The Daily Express, The Independent, The Courier, The Herald, Lancashire Times, Insider.co.uk and many more. |
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| The report was also covered widely in radio news bulletins, including on LBC, TalkSport, Smooth Radio Lake District, and Wave 105. |
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| | Christopher also recorded an explainer of his paper, which can be viewed on the IEA YouTube channel. |
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| | | | | | Director General Mark Littlewood, The Times | Time to trade… The cost-of-living crisis is hurting Britons and Prime Minister Rishi Sunak has pledged to lower inflation. Liberalising trade would be a quick win for consumers. |
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| | | | Director of Public Policy and Communications Matthew Lesh, CityAM | Free to choose… Coutts’ debanking of Nigel Farage, in part over his political views, has led to calls for a new duty on banks to uphold free speech. But before intervening, perhaps the government should address regulations that encourage the account cancellation.
Matthew also discussed this topic with writer and former MEP Ben Habib on this week’s podcast. |
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| | | | Law and Economics Fellow Cento Veljanovski, CapX | Uncompetitive regulation… The CMA is in a quagmire over its controversial decision to block Microsoft’s acquisition of Activision. What would the liberal economist F.A Hayek have made of it? Cento builds on his recent paper, Hayek on Competition: A liberal antitrust for a digital age? |
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| | | | Head of Political Economy Dr Kristian Niemietz, GB News | Get building… Rishi Sunak has pledged to address London’s sky-high housing prices by reviewing the London Plan, with the goal to identify new sites to build tens of thousands of new homes. While this is a welcome first step, more significant supply-side reform is needed to make London’s homes more affordable. |
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| | | | | State religion… The NHS is on its knees in the face of record waiting lists and frequent strike action. Why does the NHS retain its golden calf status in public discourse? |
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| | | | Matthew Lesh, Daily Express | Go for growth… The IMF’s latest update predicts that the UK economy will perform better than expected. While this is good news, plenty more needs to be done to unlock Britain’s economic potential. |
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| | | | Editorial and Research Fellow Prof. Len Shackleton, ConservativeHome | Making jobs work… Many British workers aren’t happy with long hours, low pay or a lack of flexibility. But trying to resolve these issues with more state intervention could backfire. |
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| | | | Communications Officer Reem Ibrahim, IEA YouTube | The viciousness of youth… Reem recently attended the Objectivist Standard Institute’s LevelUp conference in Arizona and asked attendees why socialism is so popular among young people. |
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| | | | Head of Cultural Affairs Marc Glendening, ConservativeHome | Unintended consequences… Labour leader Keir Starmer has shocked many with his recent reversal on his definition of a woman. But to ameliorate enraged campaign groups such as Stonewall, Labour have also pledged to punish hate crimes against trans people with longer sentences and ban conversion therapy. Although well-intentioned, these measures will likely have negative consequences for free speech. |
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| | | IES Europe Summer University | | IES Europe Summer University… Upholding classical liberal values whilst tackling crises – be it health, economic, or geopolitical – is always tough. Yet, this is exactly what the 2023’s IES Summer Academy discussed. Our very own Steve Davies, Syed Kamall, and Adam Bartha contributed to the discussion with 150 students from across Europe, all keen to learn about liberal principles. |
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