Research: The Great Risk Transfer - have we got the balance right?
How many people have the knowledge and time to manage the financial risks they face in life? To what extent does it matter? Find out more in our latest research about the Great Risk Transfer.
How many people have the knowledge and time to manage the financial risks they face in life? To what extent does it matter?
We partnered with the Institute and Faculty of Actuaries (IFoA) to explore these questions. We aimed to find out more about what people in Scotland understand to be the key risks in relation to their long-term financial wellbeing and what helps and holds them back from addressing them.
Our engagement with people in Scotland was designed to build on recent work carried out by the IFoA which has been exploring the ongoing trend of transferring risks from institutions – such as employers, the state, and financial services providers – to individuals.
The IFoA calls this the ‘Great Risk Transfer’ describing it as posing one of the most significant yet little understood social, financial, and political challenges of our time. The changes described in this work show that far greater responsibility is being placed on individuals for managing their lifelong financial wellbeing than has been the case for most people living in Scotland since the establishment of the modern welfare state.
The Great Risk Transfer research showed that the causes of this trend are complex. They include increasing life expectancy, technological advances, changes in financial regulation and political choices. The IFoA highlighted four important areas of risk transfer: pensions, work, health and insurance. Our work was designed to find out more about relevant perceptions of risk in the Scottish population and how people respond to risks which can affect their financial wellbeing.
We explored people’s awareness of the Great Risk Transfer and their ability to manage and respond to financial risks. This revealed two interlinked themes which have implications for policymakers and others interested in either mitigating against or rebalancing responsibility for the relevant risks.
Cultural – what people know, how they feel and what they do to manage risk
Structural – the wider social and economic system
Our work commenced in December 2021 and concluded as inflation grew to levels not seen since the early 1980s, with rapidly-increasing fuel, energy and food prices dominating the headlines. This comes at a time when wages and social security payments have generally not kept pace with inflation, leading to widespread acknowledgement of a significant rise in the cost of living.
Not surprisingly, many of the people we spoke to were focused on immediate financial challenges. These included high housing costs, insecure tenancies and jobs, low incomes and debt, and, for some retired people, the challenge of living on a fixed income. This report is structured around four key areas which emerged strongly in our research:
Knowledge and awareness of risks to financial wellbeing
Trust in information providers
Stress, fear, stigma and embarrassment
Ability to access and understand guidance and information
Briefing paper: Levelling up high speed broadband
Life is now virtually impossible without high speed internet connection. This briefing paper looks at progress of the roll-out so far and what more can be done.
Read the briefing paper here.
Levelling up access to high speed broadband in Scotland is vital for rural communities currently left behind. Our new briefing paper looks at the roll-out so far and potential for faster progress on this vital infrastructure.
Internet connectivity has become essential for modern life and business is virtually impossible without it. It is critical for productivity and regional equality, and supports education as well as access to public services.
Areas of rural Scotland yet to access high speed broadband are at risk of increasing outward migration accentuating the already ageing population.
The UK Government has stated its intention to deliver infrastructure that improves everyday life across the UK. The two recent financial commitments from the UK Gigabit scheme partnering with the Scottish Government R100 scheme to extend the reach are welcome.
This paper looks at the physical provision of infrastructure not issues related to access as a result of poverty.
The Scottish and UK Governments must complete faster rollout to all rural communities as part of the levelling up agenda and to support economic recovery from Covid-19.
Report: A Scotland of Better Places
A new report by Professor Duncan Maclennan, commissioned by the David Hume Institute, examines how the country can build forward to A Scotland of Better Places.
A new report by Professor Duncan Maclennan, commissioned by the David Hume Institute, examines how the country can move forward to A Scotland of Better Places.
The report is part of the Institute’s Action Project investigating the actions needed for Scotland to move faster towards being a country that is more prosperous, sustainable, inclusive and fair.
A Scotland of Better Places examines actions needed for places to deliver faster social, environmental and economic benefits.
Covid shone a light on the places in which we live, work, study, play and grow. The events of the last year have dramatically changed many people’s relationships with the places in their lives.
Our places will play a central role in Scotland’s recovery. They are inter-connected, inter-dependent and impact on every aspect of our lives.
The report is based on conversations with over 600 people in webinars. The conversations revealed a broad range of ideas that individuals, communities and organisations are ready to share and enact with governments.
There is not a single magic action to make all of Scotland’s Places thrive. Over the years there have been many policies, strategies and initiatives, often top down and not involving local people.
This is an opportunity to build forward better from Covid-19 and recognise the connections within and between places. There are major long-term changes required, and much agreement about what needs to change and how to change it. Bold policy choices could remake the sub-national governance and government of Scotland to match modern place challenges.
Professor Maclennan suggests “Using reformed financial and tax structures, listening to communities and individuals, (and especially younger and poorer Scots) in the democratic processes that will make Scotland a more prosperous, sustainable, inclusive and fair country.”
The report is part of the David Hume Institute’s Action Project which engaged more than 4,500 people from across Scotland, bringing together a broad range of perspectives on how Scotland can build forward better from the Covid-19 pandemic.
What's Your Action?
DHI launched Whats Your Action after listening to over 4,500 people across Scotland in the largest inter-generational polling and research exercise in the last 5 years.
The research, which included nationwide polling and group conversations, showed people in Scotland are taking action to be kinder, care for the environment and being more conscious about how and where they spend their money, among a host of other actions.
The David Hume Institute launched WhatsYourAction.scot after listening to over 4,500 people across Scotland in the largest inter-generational polling and research exercise in the last 5 years.
The research, which included nationwide polling and group conversations, showed people in Scotland are taking action to be kinder, care for the environment and being more conscious about how and where they spend their money, among a host of other actions.
“What’s your action?” sets out what we heard from people across Scotland. It is our simple invitation to others to engage with the conversation as well as sharing the practical actions people are taking to build a more prosperous, sustainable, inclusive and fair country.
Across Scotland, we started conversations; with people in different places, from different backgrounds and with different experiences and levels of engagement with policymaking. We asked questions, and listened. We wanted to hear different perspectives about what we can all do and hear people’s priorities for action.
We found so much enthusiasm and energy for tackling Scotland’s persistent problems. The response was loud and clear: we can all do something; every journey starts with a single step - the time for action is now.
People across Scotland shared their actions:
Priorities
People identified three key priorities for individuals, communities and businesses.
For individuals
Be actively kind, considerate and connected in all aspects of your life
Covid has taught us all we need to make time for being kind. Change starts today.
Be connected. Commit to making time to stop and chat – help build community one conversation at a time.
Seek out ways to get to know people with different backgrounds. Create opportunities to expand your bubble.
Take more and faster action to support nature and the environment, including through tackling climate change
Take action to improve the natural environment such as pick up litter on your street, volunteer with a local environmental group or take part in national initiatives such as the Great British Beach Clean.
Take responsibility for finding out your impact on the world (e.g. use a free tool like Pawprint), and take action to reduce that impact.
Make conscious choices with money
Be a conscious consumer. Wherever you can, use your spending power to support businesses that make a positive impact.
Ask how others are using your money. Assess how your money e.g. savings or a pension, are invested to make an ethical impact.
If you have spare savings, could it be doing more than sitting in a bank? Consider investing in the things or places you care about e.g. new local investment angel groups.
For communities
Be actively kind, considerate and connected in all aspects of your life
Be welcoming and open to new people. Groups are critical to helping people connect and build relationships.
For groups that have a formal role in communities, ensure decision makers have been trained to be inclusive e.g. anti-racist education, unconscious bias training in order to fulfil their responsibilities.
Join in initiatives to help raise awareness of the power of being connected e.g. the big lunch, play streets, window wanderland
Invest in youth work to realise its power to support young people and communities.
Build support around young people so it’s there as and when they need it e.g. through youth work.
Take more and faster action to support nature and the environment, including through tackling climate change
Encourage more people to volunteer and work together to make sure that everyone has access to nature on their doorstep. Make sure playgrounds and parks are accessible for disabled children.
Use the momentum of national campaigns (such as Scotland’s Young People’s Forest) to help.
Use the learning from other communities that have taken collective action on the environment (e.g. community energy projects, green spaces) to bring more and faster progress in your local area.
Make conscious choices with money
Seek out ways to work with other organisations to support and improve your local community.
Use initiatives such as ‘shop local’ campaigns and projects to improve the local economy. Collaborative efforts maximise impact and build a thriving local ecosystem.
For business
Be actively kind, considerate and connected in all aspects of your life
Adults said: Embed working conditions that treat staff with fairness, dignity and respect.
Children said: “Make sure everyone is paid enough money to be happy, healthy and safe, and make sure that there aren’t big differences in how much different people get paid”.
Deliver systematic improvements through fair pay, equality of opportunity, transparency and responsible working practices.
Encourage staff to treat customers and each other with kindness, in all aspects of their lives.
Review recruitment and employment processes. Are they a barrier for some people? If so, change them.
Take more and faster action to support nature and the environment, including through tackling climate change
Take action to reduce environmental impact across your whole supply chain. For example: retailers and manufacturers use less packaging, especially single use plastic and make it possible to recycle more.
Publish a plan for reducing the environmental impact created by your business. Be transparent about your progress towards that plan.
Manage any land and buildings to minimise climate impact (e.g. energy efficiency, etc).
Make conscious choices with money
Prioritise living wage and conditions that support fair work.
Evaluate the social and environmental impact of your business and supply chain – including pensions.
Maximise positive impact through your purchasing power. Help customers make more conscious choices by showing this impact.
Be an active part of your place e.g. local partnerships, training opportunities, and supporting those in need.
Research
In 2020, the David Hume Institute held conversations with people around Scotland. Over 4,500 people contributed to the research from all ages and backgrounds. As well as trusted partner organisations in local communities we worked with the Children’s Parliament, The Scottish Youth Parliament and U3A to ensure we reached a diverse range of participants.
Three priorities came up consistently in the research and people saw the priorities as interlinked;
Be actively kind, considerate and connected in all aspects of your life
Take more and faster action to support the nature and the environment, including through tackling climate change
Make conscious choices with money
The research conversations were also supported by a commissioned ScotPulse population survey to investigate what effect the Covid-19 pandemic had on people’s thoughts and willingness to take action in their own lives.
The ScotPulse survey found:
3 in 4 people (77%) were helping neighbours
7 in 10 people (71%) received help from their families and friends
7 in 10 people (68%) people gave to charity
1 in 10 people say they are going to start volunteering in the local community
1 in 12 people say they are going to get to know their neighbours better
1 in 20 intend to give more to charity
A Flexible Housing System for the Global Market The Hume Lecture 1994
HOP 45. A Flexible Housing System for the Global Market The Hume Lecture 1994
Sir James Mellon