News and Comment

Spending the 1%: The potential for participatory budgeting on a national scale

Thursday 26 March 2015

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The label ‘the 1%’ usually carries connotations of elitism and exclusion when mentioned in a political context, conjuring up images of a super-rich elite lording it over what they might refer to as the ‘hoi polloi’.

However, a very different 1% was discussed at a recent event organised by the UK Open Government Civil Society Network.

It was suggested that Parliament might be persuaded into committing 1% of its national budget to ‘participatory budgeting’ as part of the UK’s international commitment to ‘open government’, or in other words, designing processes that would allow members of the public to decide what allocated money should be used for.

An amount of that size dedicated to participatory budgeting – in the hope of empowering the population to make decisions about how their taxes are spent in a direct and meaningful way to compliment the slower machinery of our democratic system – is an exciting, yet radical proposal. After all, 1% of the UK government budget equates to well over £7 billion a year when calculated against the £730 billion spent by government in 2014-15.

How would it work?

Participatory budgeting would allow members of the public to decide how an apportioned central budget is spent. Typically this would require sampling a small group of the population and affording them the time and access to the information needed to make informed decisions about how to allocate these funds. We observed how this approach can lead to really positive results in a project co-delivered with NESTA a couple of years ago, both in terms of reaching budget decisions better informed by citizens and in encouraging a wider participation in civic life.

It would be important to consider the level at which the budget should be given to members of the public if scaling up: whether to separate this £7 billion at source and divide the shortfall among government departments, or to stipulate that the many bodies of government across the country commit to spending 1% of their budget through a participatory approach. Irrespective of the method, the guiding principle of participatory budgeting must be that members of the public are given the platform to truly engage with difficult budgetary decisions that are otherwise made on their behalf. This approach is mutually beneficial in helping to build a wider understanding of the challenges faced by governing bodies, while also helping to inform those governing bodies of where people’s values actually lie.

Is this actually a good idea?

Public expenditure is constrained and will continue to be so for the foreseeable future. Should we not defer to the experts to identify exactly how best to spend these funds? Perhaps we need to wait for a more stable economic climate before experimenting in such a manner?

I would argue that many of the difficult decisions being faced by budget holders at the moment are exactly those that types of deliberative engagement, such as participatory budgeting, would be best placed to tackle. There are not enough funds to be shared among of the worthy national and local causes in need of them – while experts can help to find ways to make the most of the resources we have, the really important questions revolve around what we as a society value most.

Sophie Wilson has recently argued that in morally and factually complex settings, well-run public deliberation can be one of the most effective ways to reach a good decision. As an advocate of deliberative engagement myself, I believe this approach to decision making would enable individuals to really get to grips with public finances, allowing them to make difficult decisions themselves, rather than relying on political slogans and gut reactions. This could potentially lead to a more informed, more engaged electorate.

Is it possible?

The biggest challenge would be to persuade a newly elected government to agree to relinquish control of 1% of their budget. I suspect that this proposal may be too radical for many of our political elite. Having said that, fascinating international precedents have been set. Over $25 million of district money is annually spent through participatory budgeting in New York City with reportedly impressive results, and similarly the mayor of Paris has recently committed to spend 5% of the city hall investment budget in a participatory manner.

1% of national expenditure might be too much to ask for, but a more modest increase in the profile and use of participatory budgeting as a powerful tool for increased democratic engagement is certainly possible, and dare I say likely, in the near future.

Want to know more?

A number of other ideas that the UK Open Government Civil Society Network are considering are available for information and comment on their website.