Politicians should stop trying to regulate a porn industry they don't understand

The Adam Smith Institute has reacted with dismay at the suggestion by the Government's Digital minister, Matt Hancock, that users of porn websites should have to hand over credit card details to access sites hosting pornographic content.

Sam Dumitriu, Research Economist at the Adam Smith Institute, says:

"Requiring adult websites to force users to provide their credit card details poses a dangerous threat to privacy and will enable widespread credit card fraud.

"Consenting adults shouldn't be forced to announce that they're looking at pornography to their credit card company.

"There are massive fraud risks. It could mean that users are nudged into handing over data to unsafe sites - leaving them at the risk of fraud. Pornography is especially attractive to fraudsters as victims are often too embarrassed to flag up unexpected payments to adult sites to their credit card company.

"Politicians should stop trying to regulate things they don't understand."

To arrange an interview or further comment please get in touch with Matt Kilcoyne on 07584778207 or via email matt@adamsmith.org

Entire generation risks never knowing their grandchildren

• New paper reveals Britain’s housing crisis risks turning into a fertility crisis
• Unaffordable housing is causing a fertility crisis in Britain
• Homeownership has collapsed among young people, as house prices and rents continue to rise
• This has forced people to have fewer children and put off having children until later in life
• 157,000 children were not born due to the cost of housing between 1996 and 2014
• Cheaper housing allows people to have as many children as they want, as early as they want

High house prices are preventing a generation of people from having children, says a new report by the Adam Smith Institute. Unaffordable housing has forced people to have smaller families and delay starting a family until later in life, threatening an entire generation of children who may never meet their grandparents.

With Brexit likely to lead to a decrease in immigration, the report argues, there is also a clear economic need to raise the birth rate in order to pay for Britain’s ageing population’s pension, healthcare and social care costs. As the country ages and immigration falls after Brexit, the government must remove barriers to population growth within Britain, or else face a demographic time bomb where taxes on working-age people spiral to pay for looking after their parents and grandparents.

Chief among these is the cost of housing, which is strongly associated with couples having fewer children than they would like and delaying having their first child until much later in life. The average age of women when they first gave birth has risen by four years since the 1970s, and looks to continue rising.

Though rising house prices increase the birth rate among existing homeowners, they keep people off the housing ladder and stuck renting, where they are less likely to have children.. With falling homeownership rates in the UK, especially for young people, this means that the net effect of rising house prices is highly negative on our national fertility rate. Between 1996 and 2014, a ten percent increase in house prices resulted in a 4.9% decrease in births among renters but just a 2.8% increase in births to homeowners – a net decrease of 1.3%. House price rises between 1996 and 2014 are estimated to have stopped approximately 157,000 children from being born, compared to if housing had not become more unaffordable.

The report warns that this trend is set to get even worse without radical action on housing supply from the government. The population over 85 years of age doubled between 1985 and 2010 and is expected to constitute almost 5% of the population by 2035. The median age rose from 35.4 to 40 between 1985 and 2014 and will rise to 42.9 years by 2039 unless action is taken.

The report’s author, Andrew Sabisky, argues this has serious cost implications for British taxpayers, with the over 85s costing the NHS three times as much as the average 65-74 year old whilst the number of working-age people for every pensioner is likely to fall from 3.2 to just 2.7 by 2037.

In the ten years between 2004 and 2014 homeownership fell from 60% to 35% among 25-34 year olds—the key childbearing demographic. In 1991 nearly two thirds of 16-25 year olds would have purchased property - that figure stands at just one in ten now.

Properties that young people do buy, the paper warns, will often be too physically small to fit a large family and the saving required pushes women towards older motherhood – in 2010 the average age of women giving birth went above 30 years of age with more than a quarter of births (26.5%) to mothers born outside of the UK. More and more young women are being forced to wait to have the children they want and, by both age and inappropriate housing, are forced to have fewer children than they want. These trends will mean that more and more grandchildren will be born after it is too late to meet their grandparents and great-grandparents.

This demographic decline is our choice, says the paper. To change course and allow people to start their families earlier the government must take radical action to allow more homes to be built. Without more homes and greater supply many babies will simply never be born.

Andrew Sabisky, Independent Researcher and author of the report, says:

“The housing crisis is a well-known immediate economic problem, but this report showcases how it is wrecking the lives of the people of this country, preventing them from having the children they want to have.

"This private tragedy will, in the long-run, entail massive knock-on costs to public finances. Housing market liberalisation is something the Government should do anyway, but this report outlines a new set of pressing reasons for it to act.”

For further comments or to arrange an interview, contact Matt Kilcoyne, Head of Communications, matt@adamsmith.org | 07584 778207.
 
The report ‘Children of When’ is available to read in full here.
 
The Adam Smith Institute is a free market, neoliberal think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

Adam Smith Institute welcomes the Taylor Review on the gig economy

The Adam Smith Institute welcomes the Taylor Review out today reporting on the Gig Economy.

Sam Dumitriu, Research Economist at the Adam Smith Institute, says:

"It's good news that Matthew Taylor has resisted Labour's call to ban zero-hours contracts. They provide flexibility that benefits both workers and bosses. People on zero-hours contracts actually have higher job satisfaction that ordinary employees and when McDonald's offered staff a choice most chose flexibility over security.

"Gig Economy firms like Uber, Deliveroo and CitySprint are good for both consumers and workers. They deserve a lot of the credit for Britain's record high employment rate. We should be wary of attempts to regulate new flexible forms of employment.

"One of the Report's findings suggested forcing platforms to calculate 'average' and expected hourly wages. But that would impose administrative burdens that established players can handle but new entrants might struggle with.

“We don’t want to punish employers for giving workers more rights by hitting them with higher taxes, and raising taxes on the self-employed is unpopular and will simply be seen as a money grab. The Government should be bold instead by combining National Insurance and Income Tax while expanding the personal allowance to help out those on low incomes.”

To arrange an interview or request further comment please contact Matt Kilcoyne on 07584778207.

CASH-STRAPPED COUNCILS CAN COUNT ON PLANNING REFORM

New paper identifies another way to grow Britain
•    Government could unlock billions in extra funding for councils
•    Councils should be allowed to buy land grant planning permission on it and then sell at higher value – capturing the uplift in value themselves
•    Could bring in almost £30bn from the first million permits issued by cash-strapped councils
•    This proposition would raise growth and revenues for local authorities; with no taxes imposed and no extra borrowing
 
Councils should be empowered by Government to purchase land, grant themselves planning permission and sell it on – with funds retained locally - the Adam Smith Institute argues today in a report released today.

The report’s author Dr Madsen Pirie, President of the Adam Smith Institute, says that devolving power to local councils to purchase land and grant themselves permission on it can deliver money into their coffers and bring a house building revolution.

The report argues that the Government should let councils buy land, grant it planning permission and then sell it off – benefiting from the corresponding increase in its value. This process could yield billions of pounds to pay for public services - £30bn from the first million units according to the paper’s estimates.

Land with planning permission is extremely scarce. One estimate found that an acre of land was worth £2,500 without planning permission and £4m with it. By granting permission to land they own, councils can capture the monetary benefits for themselves and their residents.

A further advantage of this new initiative is that it would clear the way for many new houses to be built where people want them – relieving the pressure on the housing market and enabling young people once again to aspire to home-ownership.

The paper says that by allowing councils to purchase land and grant themselves planning permission there would be no need to impose new taxes nor increase borrowing with a burden on future generations. It would, however, boost growth with the accelerated house-building programme it facilitated creating jobs. This in turn would increase tax revenues without the need to hike rates.

With austerity under attack from both the political establishment and the electorate it might be an opportune time to try a new approach. The paper argues the Government will find it extremely difficult to meet its spending commitments while softening some of its expenditures without seriously exploring options such as this.
 
Sam Bowman, Executive Director at the Adam Smith Institute, said:
“Right now, if you own a field that gets planning permission, you could stand to gain one or two hundred times in value what the field was originally worth. That massive uplift is called “planning gain” and the fact that local communities mostly don’t capture it is one reason they oppose new development so much – they only stand to lose from new houses being built near them.

“We need to change that. Not only would a system like the one we’re proposing make housebuilding much easier in the places it’s needed most, it would create a large and lucrative source of revenue for local government. That would truly be a win/win for everyone: more houses, more money for locals, and less of a drain on central government which can redirect some of the money saved to other areas.”

To read the full paper please click here.

For further comments or to arrange an interview, contact Matt Kilcoyne, Head of Communications, matt@adamsmith.org | 07584 778207.

Sadiq Khan should drop his loony language tests for cab drivers

The Adam Smith Institute supports Uber's appeal of the bonkers English language tests for minicab drivers that Sadiq Khan and TfL have made compulsory.

Sam Dumitiru, Research Economist at the Adam Smith Institute, says:

"Uber is right to appeal against Sadiq's bonkers written English language tests for private hire drivers.

"Passengers rightly expect to be able to communicate with their drivers in English but Sadiq's written English tests are excessive. London minicab drivers of twenty years or more must pay £200 to answer essay questions about topics like the Aurora Borealis, snowboarding and Mars. What next? Three paragraphs on Macbeth?

"The test is even hitting native English speaking drivers who've been working in London for 30 years and can't dig out their old O-Level certificates. It defies common sense. These tests risk putting hard working minicab drivers out of work – pushing prices and wait-times up for ordinary consumers.

"Most Londoners will want a driver who can get them from A to B not an expert on the Northern Lights. Sadiq should drop these loony language tests."

For further comment or to arrange an interview please contact Matt Kilcoyne, via email (matt@adamsmith.org) or phone 07584778207.

Kind regards,
Matt

The European Commission fining Google will end up hurting users in a misguided quest to help them

On Tuesday 27th June it was announced that the European Commission had fined Google €2.42bn for breaching EU antitrust laws. The Adam Smith Institute is damning in its criticism of that ruling.

Sam Bowman, Executive Director at the Adam Smith Institute, said in reaction to this morning's news:

"In fining Google this morning for giving prominence to its Google Shopping service European Regulators made the same mistake that regulators did in the 1990s when Microsoft was fined for bundling Internet Explorer with Windows products.

The basic error is to assume companies like Google and Microsoft are akin to 'Natural Monopolies.' If a user experience is made worse by Google Shopping being prioritised then users will have the option of moving to a search engine like Bing - not to mention there would be an incentive for large existing rivals like Facebook to create their own rival platform. If people can switch between platforms it doesn't matter much if, within a platform, there isn't that much competition.

The core issue here is whether we need to force competition within software platforms if competition exists between them. Just as use of Windows declined steadily as users moved to other operating systems so Google users have plenty of alternatives they can switch to if bundling worsens the platform's quality enough. Bundling has benefits as well as costs, because it pays for the free things Google does, and trying to stamp it out will end up hurting users in a misguided quest to help them."

For further comment or to arrange an interview please contact Matt Kilcoyne, via email (matt@adamsmith.org) or phone 07584778207.

Kind regards,

Matt

Tories should follow Celtic FC and score an open goal to win over English football fans

The Adam Smith Institute welcomes Celtic Park winning the Outstanding Achievement Award at the Stadium Business Awards and news that other clubs in England are looking to try the policy. We call on the Government at Westminster to repeal the ban on standing at football stadiums in England and Wales.

Ben Southwood, Head of Research at the Adam Smith Institute says:

"No surprises: Celtic’s safe standing section has won Celtic Park the Fan Experience Award from Stadium Business, in its very first year. It proves yet again that standing in football stadiums is the future—the Conservatives should seize on this to provide a liberal reform that makes a real difference to people’s lives.

We now know, from numerous reviews, that standing was not responsible for the disasters and tragedies of the 80s: that was bad policing, stadium design, and management. These problems have gone away: technology is incomparably more advanced and safer now. This is why standing operates across the continent, divisions outside the top two, and in other sports without incident.

Standing provides a much improved atmosphere—which is why 80-95% of fans surveyed in polls say they favour bringing it back time and time again. It may also allow clubs to reduce the price of the cheapest tickets: the gap between the priciest and most affordable ticket is far bigger at European clubs that have standing sections.

Many in politics already understand this, especially those MPs who are football fans: it would be a zero-cost reform that the government could do today to show fans across the country it cares about them."

The Adam Smith Institute has called for the ban on safe-standing in England and Wales to be lifted before - releasing a paper in 2016 supporting this position.

For further comment or to arrange an interview please drop matt@adamsmith.org a line or call 07584 778207.

Kind regards,
Matt

Queen's Speech - A missed opportunity?

The Adam Smith Institute (ASI) reacts to the Queen's Speech delivered earlier today.

Sam Bowman, Executive Director of the Adam Smith Institute says of the speech:

"The Queen’s speech was worryingly narrow. The Government has a slim working majority, so of course many of its more stupid manifesto commitments have been dropped. But it would be a grave political mistake to do nothing with this Parliament – voters will want something to show for this government’s time in office, and if it does nothing but Brexit and small niche Bills the voters will punish them at the next election.

Hopefully this speech won’t actually define the next two years. We need serious action on housing to bring down rents. We should seriously reform tax to boost productivity to deliver more high wage jobs. And we need to unlock private investment in infrastructure to renew parts of the country that have missed out on growth. The government ignores the problems that ordinary voters face at its peril."

For any further comment or to arrange an interview please contact Matt Kilcoyne via email matt@adamsmith.org or via phone 07584 778207

Medical monoliths can be smashed after Brexit

New report reveals opportunity for UK to be a leading medical innovator after Brexit

Britain can become a world innovator in healthcare technology following Brexit, according to a new report from the Adam Smith Institute released this morning (you can read the report in full here).

The report argues that Britain should streamline the approvals process for new medicines and health technologies, as well as allowing the use in Britain of medical products already approved by regulators in other countries with safe track records of medical regulation.

Brexit is an opportunity for Britain to overhaul and streamline its regulatory regime, giving it a unique chance to encourage more medical innovation, says the paper. Once dominated solely by multi-billion dollar companies, medical developments are increasingly coming from small start ups, which are often held back by slow and risk-averse regulators.

The UK’s Medicines & Healthcare products Regulatory Agency (MHRA) is in desperate need of reform as it struggles to adapt to new technological advances, warns the paper. Mark Lutter, the report’s author, suggests two strategies to boost the Britain’s regulatory regime. First, recognise decisions from the world’s best drug and medical device regulatory practices. Second, lower the cost of innovation here in Britain.

Under MHRA rules many new technological innovations, such as phone apps that magnify text for the short sighted, are currently counted as medical devices and subject to close oversight which deprives patients easy access to tools which would be able to improve their health or even save their lives.

As well as relaxing regulation at home, the UK should also look to use regulatory decisions made by partners in the EU and beyond. Drugs and medical devices approved by sensible regulators overseas would give Brits access to an increased number of safe and effective drugs, while at the same time cutting costs.

The world of medical innovation is rapidly changing and Brexit gives the UK the opportunity to become a leader in it. The UK can create a regulatory system that can attract the most innovative companies, says the report.

The MHRA should focus on becoming a partner to innovation, not a hindrance.Delaying lifesaving technology costs lives, the UK must seize this opportunity for regulatory reform for the health of its citizens.

Sam Bowman, Executive Director at the Adam Smith Institute, said:

“Britain has a chance to make itself a global hub for medical regulation after Brexit forces us to rethink the old ways of doing things. But we need to balance that innovation against the need for safety. This report’s solution to that need is ingenious: continue to require regulatory approval, but outsource some of that to the regulators of Japan, Germany, Canada and other safe, developed countries that also trial and approve medical products. Let’s hotwire the approvals process and unleash a new era of research and development in the field of making people live longer, happier lives. ”

Mark Lutter, author of the report and Lead Economist at NeWAY Capital, said

“The world is on the cusp of major innovations in personalized medicine, gene therapy, medical devices, and 3d printed organs. Unfortunately, regulatory agencies have slowed innovation. The MHRA, for example, classifies apps which magnify text for the visually impaired as medical devices. With Brexit, the time is right for regulatory change, to create the environment to cultivate the next generation of medical innovation.”

If you would like further information please do contact Matt Kilcoyne, Head of Communications, via email at matt@adamsmith.org | or via phone on 07584 778207.

The Adam Smith Institute is a free market, neoliberal think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

Make sure you read the report today!

Labour’s fare cap is a bung to train passengers

Commenting on Jeremy Corbyn's pledge to cut commuter rail bills by £1000, Adam Smith Institute Head of Research Ben Southwood said:

Labour’s fare cap is a bung to train passengers which will be paid in higher taxes on those who cycle, drive, or get the bus instead.

Railway improvements cost money. The government already pays around a quarter of the price of a ticket—although very little of this goes to commuters—and the more of the cost they take on, the less money we have to modernise and improve our railways.

Under British Rail, the government chronically underinvested in the railways and they dwindled for decades and half the network had to be mothballed; since we returned operating companies to the private sector passenger journeys have more than doubled. HS2 effectively rebuilds, at great cost, the high speed line that already existed—built by the private sector, and scrapped by the state.

Before privatisation there were 17 trains a day from London to Manchester—now there are 47.

The franchise system isn’t perfect, but nationalisation is a step backwards. To move forwards we must learn from the most successful systems, like Japan’s, where integrating track and train in a private system has unlocked a torrent of investment—newer and faster bullet trains every year.

For further comment or to arrange an interview please get in touch with ben@adamsmith.org or call 020 7222 499