PATCHWORK PHILANTHROPY Philanthropic & Public Spending Blind Spots & the Brexit Vote
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PATCHWORK PHILANTHROPY Philanthropic & public spending blind spots & the Brexit vote Author: Dr. Sandra S Cabrita Gulyurtlu With contributions from Sonja Jutte, Giselle Cory, David Kane and Victoria Boelman BACKGROUND In 2016, the UK voted to leave the This piece of work sought to explore European Union. This result not only these relationships in England and epitomised a clear division and lack whether there is a link between levels of of understanding between people, philanthropic giving (split between trust communities and institutions, but also a and foundation funding, and charitable discontentment with the status quo. The spending), public spending in the build vote took place in the context of rising up to the referendum, area deprivation, and inequality1, with communities across the EU referendum vote (see Appendix for the UK being altered and reshaped, technical details on the data sources used). sometimes radically, by the disruptive effects of austerity and poverty. It has Philanthropy and Brexit been argued that the Brexit vote was, in part, a result of the effects of these It is already well-known that there are disturbances, particularly austerity. deprived areas in England that receive lower levels of public spending per head We know that communities have compared to other local authorities. been experiencing the effects of cuts Likewise, Mohan’s work on charity to public services and support, while deserts (2015)4 highlighted that charitable government and many charitable funding is not spread equitably, and some trusts and foundations are increasingly deprived areas receive less philanthropic ‘turning to place’ as the answer to many funding than others. This leaves many of these challenges. Recent studies on already struggling communities lacking inequality and austerity, however, such the support they need from both the as the JRF and Localism Commission public and charitable sectors. reports2, have shown that Government and Local Government are often failing Goodwin and Heath (2016)5 found that to address inequality in the UK and meet the poorest households (i.e. with incomes the needs of local populations3. What is less than £20,000) were more likely to vote less known is the combined impact that Leave than the richest households. They trust, foundation, and charity funding is also found that this was the case for the having on communities and whether these unemployed, people in low-skilled and institutions are further compounding a lack manual occupations, and people who feel of public sector funding and investment in that their financial situation has worsened, some areas of greatest need. and those with no qualifications. Becker 2 THE YOUNG FOUNDATION et al (2017)6 also found that little or no qualifications was a strong predictor for voting Leave, as were areas with relatively low pay and high unemployment. They also found that the quality of local public service provision had an impact on an area’s share of Leave votes. Therefore, it doesn’t come as a surprise that our findings suggest that the fewer resources and provisions available to a community, the more likely they are to want to vote for change. However, whereas previous studies have looked at deprivation and public service provision, studies looking at philanthropic funding and Brexit have tended to look at the impact of Brexit on philanthropy and not vice-versa (for example, see Charitable Aid Foundation, 2017)7. In addition to the existing data on the impact of deprivation and public service provision, our findings show that a lack of philanthropic funding is also a strong predictor for local authority areas voting to leave the EU. Charts 1-4 illustrate this by comparing average charitable spend, trust and foundation funding and core public spend per head, as well as average IMD for that local authority, in Leave and Remain areas. PATCHWORK PHILANTHROPY: PHILANTHROPIC & PUBLIC SPENDING BLIND SPOTS & THE BREXIT VOTE 3 FUNDING AND DEPRIVATION BY BREXIT VOTE OUTCOME As illustrated, Remain areas not only tend to be less deprived but on average, they have also benefited from more funding and expenditure from philanthropic and public bodies. The difference is particularly striking for charitable spend and public core spending, which are highlighted in Table 1. Charitable spending per head Trust and Foundation funding per head Spend per person (£) Spend per person (£) Leave Remain Leave Remain Public spending per head Average index of Multiple Deprivation score Spend per person (£) Average of Index Multiple Deprivation Leave Remain Leave Remain Sources: Electoral Commision (2016); Charity Commision (2015/16); 360giving (2015/16); Ministry of Housing, Communities & Local Government (2015 and 2017) 4 THE YOUNG FOUNDATION COMPARISON OF AVERAGES ACROSS OUR SIX INDICATORS IN LEAVE AND REMAIN LOCAL AUTHORITIES Table 1. Showing the average Trust and Foundation funding per head, IMD average, Public Spending per head, Charitable spending per head, Average number of local charities, Combined Metric score for Leave and Remain Local Authority Areas Indicator Leave Remain Measure Explanation (Average) (Average) 1.Trust and Foundation Funding £11.29 £19.14 £ funding per Total amount for each category per head 100,000 divided by relevant population 2. IMD Average Score 19.97 18.04 IMD unit The average of IMD scores 3. Public Core Spending Power £456 £618 £ spend per Total spend for given areas, per head head divided by relevant population 4. Charitable Spend per head £172 £350 £ spend per Total spend for given areas, head divided by relevant population 5. Average number of local 144 128 Average Total number of charities charities number of local divided by relevant population charities in 100,000s 6. Combined Metric – overall score 150 201 Average rank Standard average of four ranks (indicators 1-4 above)8 Our analysis reveals that the less funding When we looked at trust and foundation available to a local authority, the more funding, we uncovered similar results. The likely residents are to have voted Leave percentage of Leave voters and amount in the referendum. Similar to Becker et al. awarded per head are significantly (2016)9 we found that the percent of Leave correlated12. This suggests that a lower vote and total spend in an LA area are amount of funding awarded per head in significantly correlated10, suggesting that a local authority in 2015/16, the higher a lower amount of core LA spending in the percentage of the Leave vote. 2015/16 is a strong predictor of voting Leave. In this analysis we excluded the City of London and Newark & Sherwood Turning to charitable spend, our analysis because they were significant outliers. also reveals a significant correlation Nonetheless, for all remaining areas, between the proportion of a population our findings suggest that - in addition to voting Leave and local charitable deprivation and a lack of public spending spending per head11. This suggests that - a lack of charitable spend and trust the lower the charitable spending in and foundation funding is also a predictor a local authority in 2015/16, the more of voting Leave. As always, correlation likely residents were to vote Leave. does not necessarily imply causation. PATCHWORK PHILANTHROPY: PHILANTHROPIC & PUBLIC SPENDING BLIND SPOTS & THE BREXIT VOTE 5 PATCHWORK PHILANTHROPY When we looked at the geographic England and London the lowest. Boston, spread of the Leave vote (Map 1) public South Holland, Castle Point, Thurrock spending (Map 2), deprivation (Map 3), and Great Yarmouth were the individual charitable spend (Map 4) and trust and local authority areas with the highest foundation funding (Map 5), we found percentage of Leave voters and Lambeth, significant variations across the board. Hackney, Haringey, City of London and At a regional level, the Midlands had the Islington had the highest percentage of highest percentage of Leave voters in Remain voters. Map 1 Leave vote share across Local Authorities in England Leave vote share 70% and over 60% – 69% 50% – 59% 40% – 49% 30% – 39% Up to 30% Source: Electoral Commission (2016) 6 THE YOUNG FOUNDATION PUBLIC SPENDING AND DEPRIVATION ACROSS ENGLAND The pre-referendum public spend figures by Keep and Brien13). However, because (Map 2) show that London is the region we looked at local authorities rather than that benefits from most public spend per regions, we also observed significant head in England (2015/16) and the South variations in public spend across local East benefited from the least (echoing authorities within regions. findings from a 2016 parliamentary report Map 2 Core spending power per head for Local Authorities in England Core spending power per head £250 and over £200 – £249 £150 – £199 £100 – £149 £50 – £99 Up to £50 Source: Ministry of Housing, Communities & Local Government (2017) PATCHWORK PHILANTHROPY: PHILANTHROPIC & PUBLIC SPENDING BLIND SPOTS & THE BREXIT VOTE 7 When we ranked the local authority to keep pace with even the national deprivation levels (Map 3 - highest average. In all of these local authorities, scoring 1 and lowest scoring 326) over 60% of the population voted Leave. and public spend per head (lowest Conversely, the Isles of Scilly, Richmond scoring 1 and highest scoring 326) upon Thames, Rutland, the City of London and combined these scores, we found and Wokingham had the highest scores. Chesterfield, Breckland, Mansfield, With the exception of Rutland which Tendring and Ashfield had the highest marginally voted Leave, all these local scores – representing pockets of relative authorities voted Remain. deprivation where public spend is failing Map 3 Index of Multiple Deprivation (average score) for Local Authorities in England Index of Multiple Deprivation 30 and over 25 – 29 20 – 24 15 – 19 10 – 14 Up to 10 Source: Ministry of Housing, Communities & Local Government (2015) 8 THE YOUNG FOUNDATION CHARITABLE SPEND AND TRUST AND FOUNDATION FUNDING AWARDED ACROSS ENGLAND The data on trust and foundation funding awards from trusts and foundations, underscores the significance of the Big and the East of England the lowest.