Who subsidises whom in the UK?

A much argued question with some clear answers

1/ on.ft.com/3b4Sr6Q
Sunak now faces pressure to lower tax on the Red Wall northern seats because they say they are unfairly treated on tax, paying too much and on spending, not getting the transport spending of London

Eg Miriam Cates, new Tory MP for Penistone and Stocksbridge

There are now loads of funds for levelling up
- the towns fund
- the levelling up fund
- the shared prosperity fund
- changes to the green book for investment

You’d have thought that London and the South East had been partying on the backs of northern tax revenue

But no, it’s not true - never has been and the subsidies from London and the South East to the rest of the U.K. have grown substantially since 2010

The pandemic has seen levelling down, with the capital having the disproportionately large increases in UC and furlough, complicating the levelling up story further

And median living standards (net incomes after housing costs) are below the UK average in London too.

So there is a disconnect between GDP figures and living standards.

The capital’s streets aren’t paved with gold
So, if Londoners, on average, aren’t rich and heavily subsidise the rest of the country, what is going on?

Answer: There are many more working age people in London, and a big chunk of the rich.

And the UK state redistributes from these groups to others


Also wise words from Tony Travers on the futility of looking at regional spending levels looking for unfairness

It does mean looking to create more dynamism, more graduates, more easy career paths outside the South East for people. That probably means big cities action, not a focus on seeking future prosperity (pretax) from small towns

See @thomasforth


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More from @ChrisGiles_

21 Feb
There is a vaccine effect now in the UK, but it is dwarfed by the lockdown effect
- With case numbers still high, suggests a need for caution
- but a delicate balance on opening up because the virus and lockowns hurt

latest with @jburnmurdoch

@jburnmurdoch The obvious thing here is that the decreases have been almost as large in unvaccinated groups
@jburnmurdoch And the UK's lockdown and health policies have been more successful than in Israel, even with far fewer vaccinations
Read 4 tweets
16 Feb
The US is undertaking the greatest economic experiment since the Reagan reforms in the early 80s

Will this be Biden’s moment, or will it resemble Mitterrand’s France in 1981?
1/ on.ft.com/3qpW50u
The US economy did well last year, not by controlling Covid, but by borrowing and spending. A lot.

Now it plans to go further, using more borrowing and spending to put its economy on a better path than pre pandemic

The assumption is it can do better. Quickly. Complete reversal from post financial crisis where everyone accepted lasting economic scars and painful fiscal consolidation

Read 5 tweets
6 Feb
Disappointingly, there isn't a vaccine effect in the English coronavirus case data yet when looked at by age

There seem to me to be three plausible explanations
1) Be patient
2) English over 80 cases were affected by other forces - eg outbreaks again in care homes
3) The one-shot vaccine isn't as effective as two for older groups

These are not mutually exclusive
Read 5 tweets
2 Feb
UPDATE: After today's @ONS data, the latest estimate for the number of excess deaths in the UK linked to coronavirus is


Note that 50,000 of these have happened in the second wave, so don't let anyone say death numbers are normal

@ONS The one thing that is true is that in the second wave, excess deaths (compared with the 5 year average) are lower than the count of deaths wihtin 28 days of a positive test and coronavirus mentions on death certificates

@ONS There are two valid interpretations of this

1) Some would have died anyway eg from flu in a normal year. See @d_spiegel

2) Now we're better at preventing flu with social distancing the 5 year average is wrong, so excess deaths is an underestimate @statsgeekclare

Read 5 tweets
26 Jan
Here is the grim UK death total by different ways of measurement - all above 100,000

28 days since positive test

Death certificates with Covid mentioned

Excess deaths
And how the charts look on a daily basis

Charts courtesy of @jburnmurdoch
Excess was higher in first wave because testing for the virus was so poor.

It's lower in the second wave because there have been fewer non-Covid-19 deaths than usual - likely to be due to social distancing limiting other respiratory illnesses
Read 5 tweets
19 Jan
UPDATE: Following today's @ONS data for England and Wales, my estimate of the number of UK excess deaths linked to coronavirus since mid March 2020 has surpassed a new grim milestone of


Of these, 94,745 have been recorded officially, the remainder are estimates

@ONS There is now strong evidence that the number of excess deaths accelerated as the second wave became more intense towards the end of December - estimates of the daily totals rise significantly

But are still well below the spring peak

@ONS It no longer appears true that excess deaths in the second wave are lower than the daily death totals

Why? My hunch is that as waves intensify, hospitals find it harder to save those who would have survived when pressures lighter

Read 9 tweets

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