Hundred Pockets

There’s a new blog in town, currently being e-mailed round (despite not having formally launched yet): LeftFootForward. Billed as an evidence-based progressive blog (they draw actual graphs and everything), and seemingly connected to IPPR and Progress, I’m sure they’ll make a fine addition to the UK blogosphere. I’ll add them to the blogroll as soon as I get round to putting in a ‘UK’ section.

Surely the best welcome I can offer, though, is to disagree (respectfully) with one of their posts. Martin McCluskey’s critique of Conservative school policy (’Unaccounted £1bn cost of Tory school reforms‘) makes what I think is a fairly basic mistake.

For the uninitiated: the Tories have proposed new powers for charities, co-ops, non-profit companies and/or parents to set up new schools. Crucially, these schools will be allowed to open even if their area already has ‘enough’ school places. The reasoning is fairly simple – some school places are terrible. Refusing to allow a new school to open – simply because a failing school exists down the road – is not a recipe for driving up standards.

We’ll leave the knotty literature on ‘School Choice’ to one side for now, and focus on Martin’s post. After expressing some (healthy) scepticism about the Swedish school system, which the Tories are using as a model, he makes his big accusation:

In their 2007 paper [Raising the bar, closing the gap], the Tories proposed an extra 220,000 school places (p. 9). Maintaining current levels of funding per child (set at £5,250 for 2010-11) would result in annual costs of £1.2 billion.

These annual costs cannot be covered by the proposed savings of £4.5 billion from the Building Schools for the Future programme (p.39) since this has been earmarked “for the building of New Academies.”

What’s the error here? Martin is confusing school places with children. Schools in the UK system, are funded per pupil, not per place. And while the Tories have proposed 220,000 new school places, they have not proposed 220,000 new children (eye-catching as that would be in any manifesto…)

The Individual Schools Budget received by a school is heavily dependent on the number of pupils enrolled, weighted by their age  (’Age Weighted Pupil Units’ or AWPUs [pronounced oar-poos] in the terrible jargon). Schools get a few dollops of cash for their fixed costs, but empty places (to a first approximation) aren’t funded at all.

So creating 220,000 new places requires a capital budget (to physically build/kit out thousands of new classrooms), but need hardly affect the annual (’recurrent’) cost of funding schools at all – because funding is ‘per-pupil’, and we have the same number of pupils we had before.

The annual £1bn ‘unaccounted cost’ of the post’s title is the result of a misunderstanding.

The second (smaller) error in the paragraph above is the claim that the ‘Building Schools for the Future’ budget (a gigantic pot of cash earmarked for school construction/refurbishment) can’t be used to fund these new places “because this has been earmarked for the building of New Academies”.

Of course, the current Government can earmark its funds for whatever it likes. But an incoming administration can also ignore those earmarks, because under the UK’s unwritten constitution, no Parliament can bind its successor. There may be costs involved in renegotiating already-agreed contracts, but incoming governments are often willing to incur such costs (as some companies are already discovering). And it costs nothing to reshuffle contract-free ‘earmarks’.

So welcome to the Blogosphere, LeftFootForward. I look forward to the conversation.

Megan McArdle has long been sceptical of those sermonizing government ads, begging us to lay off the smoking/drink-driving/over-eating/…

Government coercion has also proven somewhat effective – cigarette taxation and anti-smoking laws have, as far as I can tell, helped cut into smoking quite a bit. But the middle ground, where they just try to persuade us to change our ways… [has] not made any noticeable dent in the behavior they were trying to change. Now, if there were great misapprehension out there about the downsides of being overweight, the government might make a difference . . .  But I don’t think there are a lot of people in America who are under the illusion that being overweight is in any way desireable.

The idea here is that if the government has new information to impart to its citizens, then its campaigns can be effective ( e.g. “From next Monday, we will drive on the other side of the road.”) . But if the government is just moaning (”Thing X, which you already know is bad for you, is, like, reeeaaallly bad for you…”), then its efforts are doomed to failure. Possibly laughable failure – see e.g. Boing Boing’s fabulous compendium of British Public Service Ads.

If Megan is right (and I tend to think she is), then governments are pouring millions of pounds down the toilet every year. Is there anyone left in the UK who doesn’t know that smoking causes cancer? That won’t stop them telling us again. And again.

That said, there’s at least one area where preachy government ads may (may) have made a difference, at least in the UK: drink driving. It has become far, far less socially acceptable to drink and drive in the past twenty years. Even the young and carefree (/moronic) have become more conscientious about it – more conscientious than their parents, in many cases.

I remember working in a restaurant (I was a waiter long before I was an economist) with some otherwise lovely South African staff, some of whom thought drink driving was actually kinda fun. Enjoying a beer after work, the British staff would smile politely through tales of ‘hilarious’ drunken derring-do on the roads of Jo’burg – but with that rictus grin commonly seen at family get-togethers (let’s call it the ‘Oh god, Gran’s about to say something racist’ grimace).

So did the government ads really manage to affect our behaviour?

Or was it a cultural change which would have occurred anyway?

Or should we update John Stuart Mill ‘On Liberty’…?

The only purpose for which adverts can be rightfully screened by governments towards any member of a civilized community, against his will, is to prevent harm to others. His own good, either physical or moral, is not sufficient warrant.

Chris Dillow at Stumbling and Mumbling draws an interesting chart of life expectancy against health spending in OECD countries. While there appears to be a strong correlation, he makes an important point about what’s driving it:

The strong correlation between health spending and life expectancy exists largely because there are a handful of poor countries (such as Turkey, Poland and Mexico) which spend little on health and have low life expectancy. If we exclude the seven countries in our non-US sample with health spending below 7.5% of GDP, the correlation between spending and life expectancy falls to a statistically insignificant 0.16.

We see something very similar looking at education spending. Take the chart below, showing education spending against maths scores in OECD countries (from the OECD’s gigantic and increasingly misnamed Education At A Glance document)

Spending vs. Maths scores (source: OECD)

There definitely appears to be a positive correlation between spending and achievement. But what if we redraw the chart, leaving out Mexico and Turkey?

Spending vs. maths score, excl. Turkey and Mexico

Positive correlation eliminated. No-one’s saying that spending is completely irrelevant to education outcomes (or health outcomes for that matter). But when politicians and pressure groups clamour for funding increases, it’s worth remembering that money isn’t everything. (And I’m an economist saying that…)