Social Science in a Policy Context Richard Price Director of Policy Analysis and Chief Economist Defra 27 January 2011

1. Social Science in a Policy ContextRichard PriceDirector of Policy Analysis and Chief EconomistDefra27 January 2011

2. Presenting an overview of the policy context for Defra and some core interests for evidence • The political background • Defra’s approach to evidence • Reflecting the environment and social impacts • Drawing it all together

3. Defra’s priorities are set out in our business plan. Social sciences support delivery of our priorities • Support and develop British farming and encourage sustainable food production • Help to enhance the environment and biodiversity to improve quality of life • Support a strong and sustainable green economy, resilient to climate change Defra Business Plan 2010

4. The wider Coalition government objectives are also central to Defra objectives, especially the drive towards measuring Wellbeing “...the government is asking the Office of National Statistics to devise a new way of measuring wellbeing in Britain. And so from April next year, we’ll start measuring our progress as a country, not just by how our economy is growing, but by how our lives are improving; not just by our standard of living, but by our quality of life.” David Cameron. Nov 25, 2010

5. ‘Evidence’ provides crucial underpinning to Defra’s policy development • Defra uses evidence to support sound decisions in developing, implementing and evaluating policy • Evidence includes facts, risks, uncertainties, ambiguities and analysis of the limits to knowledge, and the viability of alternative options for future innovative solutions • Evidence is developed in partnership within and outside Defra

6. Agenda setting Define the issue Understand the situation Evaluate & adapt Outcome focus Develop & appraise options Implement & monitor Commit to responsibilities Prepare for delivery Evidence is used at all stages of the policy cycle: thinking through what is the problem, what will work and assessing the policy impacts

7. What are the social sciences questions for Defra • Wellbeing • Social Impacts • Green Economy • Understanding and Influencing Behaviour • Policy specific issues

8. Reflecting environmental and social impacts in policy leads to measuring wellbeing Many definitions agree that wellbeing is multi-dimensional, involving: • Material living standards • Health • Education • Personal activities • Political voice • Social connections • The environment • A sense of security These dimensions of wellbeing are exactly what we are looking at by considering social impacts of a policy. We are interested in social impacts because they affect our wellbeing.

9. Government Economic Service undertook a Review of the Economics of SD

10. The GES Review made five core recommendations: • Use the three capitals framework – assess social impacts systematically (rather than social capital) • Clearer guidance and better basis for internalising key environmental externalities – targets and shadow prices? • For non-marginal impacts – an ‘asset check’ for assets critical to economic and social activity • IA requirement to offer Ministers offsetting measures • More transparent choices on what to pass to future generations

11. A framework to account for the stocks and flows contributing to wellbeing is under development Work in progress

12. Different but potentially complementary approaches could be applied Asset check Focuses on critical environmental assets Focuses on physical stocks Forward looking (supports impact assessment of new policy) Strong sustainability w.r.t. critical assets Wealth accounting In principle embraces all natural capital Focuses on flows of services valued in monetary terms Backward looking (sustainability of current growth path) but could inform future economic planning Admits substitutability between different forms of capital Both approaches are information hungry and rely on good, frequently updated information on stocks!

13. Environmental change Situational factors Influencing human behaviour Behavioural factors We recognise there are many factors contributing to human behaviour Experience Infrastructure Norms Attitudes Culture Social networks Beliefs Geography Habits Self-efficacy Institutional framework Values Identity Social learning Access to capital Awareness Knowledge Information Altruism Leadership Perceptions

14. How it all fits together Social Impacts Taskforce Green book guidance Defra /DECC valuation Magenta book guidance Produced and human capital Natural capital Social capital Asset check Market impacts Wellbeing and GDP Environmental impacts Social impacts Evaluation and feedback Cost- benefit analysis Impact Assessment Policy decision Policy problem Design and appraisal of options BRE Impact Assessment Toolkit BIS

15. In summary... • SD review develops an operational definition of SD which has traction on policy • Lots of work to improve valuation, including carbon and ecosystems approach • Transparency on what we want to pass to the next generation • Requires a ‘critical assets’ assessment to deal with non-marginal effects, outside CBA, and • Periodic assessment of the stock of assets • Social impacts work links to wellbeing • Work in progress!

16. Contact: Richard Price, Director of Policy Analysis and Chief Economist Defra richard.price@defra.gsi.gov.uk