On Friday, the Office for National Statistics raised its estimate of the economy’s growth in the fourth quarter of last year from 0.1% to 0.3%. This is, of course, good news, but the most interesting growth question at the moment is not “Are we up or are we down?” but “How likely is it that the economy will expand enough in 2010 to prevent big rises in unemployment?” Unfortunately, there is no reason to think anything more than “unlikely.”

Since the recession started many firms have asked their employees to work fewer hours or take pay cuts. This bargain has been underpinned by employers hoping that demand for their goods and services would pick-up again, and that their staff needed to take the partial and temporary hit of a poorer job in order to avoid the big hit of not having any job.

In the jargon, someone who is working but wants to do more hours is “underemployed”. There will always be people who want to work more, but there has been a big rise in their number recently. In the year to the third quarter of 2009, 605,000 extra people declared that they were underemployed when the Office for National Statistics asked them about their job status. It is this group that is under threat from growth not being good enough to keep them in work.

This is worrying, not least because many of them will have to claim unemployment benefits when they do fall out of work. As a Policy Exchange report out this week will show, they will fall into a welfare-induced poverty trap that can make working look like a bad idea. Some claimants will, when they see how their benefits are withdrawn when they move into work, realise that they are likely to end up working for less than £1 per hour. Would you work for that?

Lawrence Kay is a Research Fellow in the Policy Exchange Economics Unit. “Escaping the Poverty Trap: How to Help People on Benefits in to Work” will be out this week.

The Department for Health did not have a good week last week.  It started with hospitals being accused of putting patients’ lives at risk, for failing to comply with safety alerts issued by the National Patient Safety Agency.  And it has ended with the DH accepting that it must agree a way of measuring and reporting hospital death rates, after Policy Exchange released a series of official documents, obtained under the Freedom of Information Act, which criticised the NHS for a ‘pervasive culture of fear’ and obsession with targets rather than a focus on patient safety

The documents, submitted to the DH by three internationally respected healthcare organisations, detail a litany of failures in oversight mechanism.  The first report said there was a ‘pervasive culture of fear in the NHS and certain elements of the Department for Health’ and regulation was ‘light-handed’.  It highlighted the flaws in the system of allowing hospitals to declare whether they were compliant with national standards – as two thirds of the assessments made by regulators did not agree with the declarations.

The second report found that the health service did not have a clear idea of what good quality health care meant so resorted to the default position that “quality means meeting the targets”.  This report too stated  “The NHS has developed a widespread culture more of fear and compliance, than of learning, innovation and enthusiastic participation in improvement”, and that “Most targets and standards appear to be defined in professional, organisational and political terms, not in terms of patients’ experiences of care”.  The final document criticised the Department of Health for being more interested in costs than clinical quality and that assessments of health care seemed to be motivated by political rather than health concerns.

As we’ve pointed out, it is astounding that there is no system of performance improvement in the NHS.  But suppose there was. If we could, say, spot increased mortality at any hospital on a monthly basis we could prevent temporary problems turning into scandals – and so avoid the tragedies like the ones at Tunbridge Wells, Mid-Staffordshire and Basildon & Thurrock.

And there is already a way to do that.  The Hospital Standardised Mortality Ratio (HSMR) was developed here in the UK.  It accounts for different risk factors so that hospitals undertaking complex operations, or dealing with critical patients, are not painted in a poor light.  It measures the hospital’s actual performance against what is expected – and so can give an early warning to inspectors, regulators, clinicians, and patients.   HSMRs have been around for many years and consequently they have large evidence base which shows that they are reliable and robust.

More and more countries around the world are adopting and publishing HSMRs as part of their hospital performance improvement plan.  Whilst it is welcome that the DH has finally admitted it must do the same, we can’t afford for the Government to drag its feet any longer – the sooner we have a proper means of seeing hospitals’ performance rates, the better.

Natalie Evans is Deputy Director of Policy Exchange.

The phoney election campaign continued last week.  The media seems to have decided that the Tory “wobble” is over, after the launch of some pretty good posters and a warm media welcome for their policy announcement on cooperative public services.  With their whole campaign operation now transferred from Norman Shaw South into Milbank as of last week, the Tories are now all set for the vote.

It was a funny sort of “wobble” anyway, as none of the last 24 polls have shown the Conservatives more than 2 points in either direction from 40%.  Given that the statistical margin of error on these polls is plus or minus 3%, none of the them have shown a statistically meaningful shift.  But little things like that don’t affect the Westminster narrative.

One of the incidents in the “wobble” related to a screw-up by the Tories about a decimal point.  They released an otherwise excellent report on how inequality has grown under Labour.  The document shows how the gap between rich and poor has grown in not just in income, but in health, education, housing – you name it.  However, due to a cock up the document initially claimed that in poorer areas 54% of teenage girls in poor areas got pregnant, rather than the real figure of 5.4%.

This was a bad mistake and caused a big Westminster row.  But hang on a minute.  The real figure should give us serious pause for thought.  More than one in twenty teenagers getting pregnant is really, really high. A larger proportion of teenagers in Britain have children than any other EU county apart from Romania and Bulgaria.  The rate is more than double the European average and five times higher than countries like Denmark, Switzerland and the Netherlands.

And teenage pregnancy is very concentrated in poor areas. For example, in leafy Rutland the teen pregnancy rate is 1.4%, while in less leafy Lambeth it has averaged 8.9% in react years. Given the concentration of the problem in poverty hotspots, and the fact that 92% of teenagers who have children are not married, teen pregnancy often kicks off a cycle of intergenerational poverty which can last for many decades.  In the long term, this costs the state a fortune – quite apart from the mass misery involved.

Part of the problem is about poverty, and part of it is about culture.  Hence Cameron’s continuing criticisms of the premature sexualisation of children.  But the bully pulpit alone won’t solve these difficult problems.  I don’t believe that we have the policy answers to them yet – although they are soluble.  For this reason Policy Exchange’s work in this area will continue to grow.

Meanwhile, we are now seeing all the hoopla of an election campaign: student stunts, bizarre poster spoofs, weird viral web trends (e.g. “Dave Facts”) and – God help us - novelty records (cf.“There’s no-one as Irish as Dave Cameron”).

What we aren’t seeing yet is any discussion of the big issues.  It isn’t just the big missing discussion about deprivation and social breakdown. Britain’s media seems generally unable to grapple with the detail of big policy questions, so instead reports on easy-to-grasp personality clashes and Westminster spats.

With such an information-poor public debate, it is sad that James Purnell has decided to step down at the next election.  He was not only one of Labour’s better potential leaders, but also one of the few people on the left really able to step back and question their policies.  There is far too little thinking in British politics, and there will be even less in the Labour Party without Purnell.

Neil O’Brien is Director of Policy Exchange

The murder of army cadet Joseph Lappin suggests that there is something very wrong with the way we tackle anti-social behaviour. Despite having breached sanctions more than 40 times, his attacker was never sent to jail – and was free to kill Joseph, an innocent bystander, outside a Liverpool youth centre in October 2008. Although the particular consequences of the criminal justice system’s failures were exceptional in this instance, our research released this week suggests that the case is worryingly indicative of wider, systemic failings.
 
A State of Disorder, published last week, reveals that between 2002 and 2007, just 14 people were imprisoned for breach of an ASBO. The Government officially claims that more than half of those who breach their ASBO are imprisoned, but they are actually being locked up for other criminal offences at the same time. The figures expose the myth that ASBOs are being used as a stand-alone, preventative tool to protect the public from repeat and serious anti-social behaviour. In reality, any sanction for breaching an ASBO is merely an addendum to an already blossoming criminal career.
 
The scale of anti-social behaviour is such that the ongoing national debate about ASBOs often misses the bigger picture – especially the needs of victims. One of the most prevalent problems for them is persuading local agencies to take anti-social behaviour seriously. As the Home Secretary has admitted, victims of persistent antisocial behaviour find themselves bumped from one agency to another, when all that they want when they report it is simply for the behaviour to stop and for them to be dealt with by the council and/or police in a satisfactory way. But there is, for instance, no measure of victim satisfaction with the action taken by local agencies and no indication of the success rate of cases. Last year, the Government did consider creating a new national indicator – but the measure was inexplicably dropped.
 
 We need radical police reform to ensure that local concerns are taken seriously.  First, we need the police to be more accountable to local communities – through the introduction of directly-elected local police commissioners. Proper local accountability would drive a radical change in policing culture, making sure that community concerns (especially anti-social behaviour) are prioritised. They would also chair the local Crime and Disorder Reduction Partnership, driving multi-agency working and ensuring a coordinated approach is taken.
 
This must go hand in hand with comprehensive steps to free the police from the performance management regime which has prevented them from doing those unseen things – mediating, problem-solving, prevention, protection, setting community standards – that real community policing should be all about. One recent example highlighted in a Government review told the story of a police officer who reduced crime and disorder on one estate by 90% over six months through a problem-solving approach. His only reward was criticism for not meeting personal arrest targets. This kind of performance management must be stripped away if we are ever to make an impact on a problem which blights so many of our most deprived communities.
 
Max Chambers is a Research Fellow in Policy Exchange’s Crime and Justice Unit.

As our report More Fees Please? this week recommended, university fees need to rise if we are to protect the quality of the student experience in the future.  Anyone who reads a newspaper will know that things are not looking good. Mandelson’s machete has sliced through the higher education budget – and there are rumours of worse cuts to come. Higher fees should never be used to let the Government off the hook on supporting a sector that delivers serious benefits for our economy and society, but graduates should contribute towards the education from which they will profit – and right now those contributions are not even touching the sides.
 
University heads warn that key subjects will face the axe, and while the Government may talk a good game about the importance of science, these departments are expensive to run and seriously underfunded. Science departments that haven’t scored highly in the all-important research rankings will be particularly vulnerable. That said, arts and humanities dons shouldn’t imagine they are safe. These subjects are clearly low priority for the Government, and some institutions feel that it is easier to ditch arts subjects without damaging your claim to be a serious player. There is little doubt that modern languages will be wedged in the firing line right across the country.  Meanwhile, with vice chancellors urgently seeking redundancies, the ratio of staff to students will continue to fall.   And of course if domestic fees don’t budge, international students whose fees aren’t capped will increasingly be seen as a lifeline – fundamentally changing the landscape of higher education in the UK.
 
Yet fees must only rise if students themselves will clearly benefit. For too long universities have focused on research, without thinking hard enough about the experience of their students.   And for too long universities have refused to answer the questions that really matter to parents and students, expecting them to choose their course with no clear idea of whether it will lead to a job, what they might earn, how many hours teaching they will receive or how big their classes will be. The culture has to change. Graduates must invest more in their higher education – but so too universities must demonstrate that they are actively investing in students in return.

Anna Fazackerley is Head of Education at Policy Exchange.