A Guide to the UK Prosperity Index

1 A Guide to the UK Prosperity Index The UK Prosperity Index is a comprehensive measure of prosperity across UK local authority areas. Prosperity broadly defined as wealth and wellbeing is a multi-dimensional measure of the determinants of a good life. It goes beyond GDP as a measure of national success to capture human flourishing. Wealth creation is important, but so too are health, education, and community. The global Prosperity Index, measuring prosperity at a national level, looks at the many dimensions of human flourishing through a lens of wealth and wellbeing. Yet we recognise that many of the enablers of, or obstacles to, flourishing occur at a far more local and personal level. These factors are what determine how national prosperity is distributed within a country, and with it, how prosperous a country is overall. These factors are what the UK Prosperity Index seeks to measure. The UK Prosperity Index takes objective and subjective data to measure prosperity across seven sub-indices: Economic Quality, Business Environment, Education, Health, Safety & Security, Social Capital, and Natural Environment. This reflects the pillars of the global Index, less those that are determined at the centre of government and that do not vary by local area, namely Personal Freedom and Governance. The data in the Index all comes from respected sources: the majority from the Office for National Statistics and various government sources. This is the first time this data has been brought together in this way to determine local success. The Index covers 389 of the UK s 391 local authority areas. In England, this means the Index reaches the second tier of local government district councils where they still exist. The only two areas excluded from the Index are the Isles of Scilly and the City of London, where large amounts of data are missing. Choosing Variables Variables were selected using the global Prosperity Index as a guide. This Index covers distinct themes within each pillar which were applied to the UK local context. For example, in Health we look globally at life expectancy, mortality, and risk factors. We chose variables relevant to the UK context that reflected these core themes, plus others that are not available globally, like mental health. Some variables transfer directly, like poverty rates. Others, we selected more UK-appropriate variables to reflect the theme. For example, in Social Capital, housing affordability is highly relevant and important in the UK context, and in itself through its impact on owner-occupancy rates, has a strong effect on social capital. Housing affordability is not something we measure globally. Constructing the Index 1. Each variable was standardised between 0 (worst) and 1 (best). 2. A score for each area in each sub-index was generated as a simple average of the standardised variable values. This generates seven separate scores for each area, one in each sub-index. 3. An overall prosperity score was generated by taking a simple average of the seven sub-index scores for an area. 4. Ranks are generated accordingly. Calculating the Prosperity Gap 1. Prosperity score was plotted against an area s economic output (GVA per head). 2. A trend line was modelled, generating an average trend for how wealth affects prosperity level in the UK. 3. Using the equation of this line, an expected level of prosperity was calculated for every area of the UK based on their economic output. 4. The prosperity gap is the difference between how much prosperity an area delivers compared to what the UK average trend would suggest it delivers. This can be positive (prosperity surplus), or negative (prosperity deficit). Geographical Coverage and Data Gaps Where possible, we sought data with full UK coverage at a local authority (district) level from a single source. The majority of the data in this Index is of this type. Exceptions include: DATA AVAILABLE ONLY AT A LOCAL AUTHORITY (UNITARY/COUNTY) LEVEL This is the case for a small number of data points (e.g. educational attainment), and affects parts of the UK where two-tier local

2 government (county and district) is still present (e.g. Devon). We applied the county data point to all constituent districts. DATA AVAILABLE ONLY AT A REGIONAL LEVEL There are only two data points volunteering and personal safety where this is the case, though we have lower level data for Scotland for volunteering. Given the importance of volunteering for social capital, we decided to include the data point, despite the limited coverage. We applied the regional data point to all constituent districts and unitary authorities. DATA AVAILABLE AT A DIFFERENT GEOGRAPHIC STRUCTURAL LEVEL Some data was only available on NUTS 3 boundaries (e.g. GVA growth). While most NUTS 3 boundaries follow existing local authority boundaries, there are a couple of areas that do not. Where boundaries match, we applied the NUTS 3 data point to all constituent districts. Where the boundaries did not, we applied the NUTS 3 data point to districts where the majority of that district fell within the NUTS 3 boundary. MULTIPLE SOURCE DATA Some data had to be taken from multiple sources, where no UK wide single data source was available. Volunteering is a good example of this, where England, Wales, Northern Ireland, and Scotland data were drawn from different sources. While we recognise the limitations of this approach, we were careful to ensure the data collection methods were highly similar, allowing for basic comparability of the data. MISSING DATA WITHIN A SINGLE DATASET We had two approaches for dealing with this. Where the data is linked to a growth trend (e.g. medial annual income), we used the last available data point for an area, and applied the county level growth rate to estimate a more recent value. Where the data was not (e.g. infant mortality), imputation was used. MISSING DATA NOT WITHIN A SINGLE DATASET Imputation was used to generate a full data set for educational attainment, where measures differ slightly within the four constituent nations. This imputation was based on a number of different educational attainment datasets. Sub-Indices and Variables ECONOMIC QUALITY This sub-index captures not only key economic fundamentals like growth, but also the quality of that growth. This is reflected in measures like poverty, but also people s feelings about their economic situation. The quality of growth, not only its quantity, is an important reflection of how local economies deliver for their people. Unemployment Key economic fundamental, also speaks to local opportunity. % of the working age population who are unemployed Office for National Statistics, Northern Ireland Labour Force Survey Long term unemployment Reflection of deeper structural problems in a local economy, speaks to more deep rooted deprivation and absence of opportunity. % of the working age population who have been claiming unemployment benefit for more than 12 months Office for National Statistics Child poverty Captures the extent to which local economic growth is resulting in better lives for people (quality of growth), speaks to the fundamental foundations of a child s life. % children living in households with equivalised income below 60% of the median income (calculated to reflect the cost of housing) Child Poverty Action Group

3 NI data is listed for old government districts. These were mapped onto the new boundaries using population data for those under the age of 18. Feelings about household income Captures quality of growth and how people are managing on their income. % who are living comfortably on their current income Job satisfaction Captures quality of growth through the quality of jobs created. % who were somewhat, mostly or completely satisfied with their job Median annual earnings Objective data on local incomes, complements the subjective data on how people are getting by. Median annual earnings ( ) Office for National Statistics Economic growth Key economic fundamental. 5 year trailing GVA growth (%) Office for National Statistics Coverage: UK, NUTS 3 BUSINESS ENVIRONMENT Measures entrepreneurial and business activity, alongside the key infrastructure required for businesses to form and grow. Wealth creation is fundamental to local prosperity through the jobs and opportunities it provides. Broadband speed Key business infrastructure, captures basic levels of telecommunications access. Average broadband speed (Mbps) Ofcom Superfast broadband access Key business infrastructure, captures advanced levels of telecommunications access. % with access to superfast broadband (greater than 24 Mbps) Ofcom Business survival Key outcome measure of the local business environment. % of business starts who are still trading after five years BIS, now Department for Business, Energy, and Industrial Strategy

Entrepreneurship rate Measure of business activity and attractiveness of local area for new business start-ups. New business creations per 1000 people Own calculation using business starts data from BIS, now Department for Business, Energy, and Industrial Strategy and population data from the ONS Logistics Index Key business infrastructure, captures access to road, rail, ports, and airports. Index of access to trunk roads, rail, ports, and airports based on distance from centre of local area Own calculation EDUCATION Measures human capital, educational attainment, and attendance. Methodological note: Due to the devolution of education, attainment was difficult to capture. We have calculated, using multiple available measures of GCSE (or equivalent) attainment to impute some missing values, national data for basic attainment and core subject attainment. However, this does not reflect the relative difficulty of the exams set in the devolved regions. Reforms to GCSEs in England have raised the difficulty of the tests, resulting in lower attainment than areas where exams remain easier. This is not something we can easily account for. We recognise the limitations in trying to create a comparable table of GCSE attainment, but felt it important to try to capture attainment in some way. We recommend more harmonised data reporting across the UK, and as moves to reform exams elsewhere develop, we believe this will grow more comparable across regions. We also wished to capture early years outcomes in some way, recognising that this is the most fundamental phase in a child s development. However, again, the absence of harmonised (or in the case of some areas, any) data across the UK prevented us from including it. The same holds for vocational training through apprenticeships. Attainment at 16 Captures basic educational attainment. % receiving five GCSEs or equivalent at A*-C DfE, Education Scotland, Welsh Government, NI Department of Education Core subject attainment at 16 Captures educational attainment including in core subjects important to future employment. % receiving five GCSEs or equivalent at A*-C including core subject DfE, Education Scotland, Welsh Government, NI Department of Education Truancy Captures attendance and reflects deeper social problems in an area. Unauthorised absence (%) in state-funded secondary schools DfE, Education Scotland, Welsh Government, NI Department of Education and own calculation Qualifications Basic measure of local human capital. % population with no qualifications Office for National Statistics and Northern Ireland Labour Force Survey 4

HEALTH Measures mental and physical health, wellbeing, risk factors, and health satisfaction. Life expectancy Fundamental health measure. Calculated from male/female data using local population share data. Life expectancy at birth (years) Office for National Statistics with own calculation Life expectancy at 65 Fundamental health measure. Calculated from male/female data using local population share data. Life expectancy at age 65 (years) Office for National Statistics with own calculation Anxiety Measure of mental health. Overall, how anxious did you feel yesterday? Where 0 is not at all anxious and 10 is completely anxious (mean score) Office for National Statistics Eudaimonic Wellbeing Measure of wellbeing, more long-term/fundamental measure than happiness measures. Overall, to what extent do you feel the things you do in your life are worthwhile? Where 0 is not at all worthwhile and 10 is completely worthwhile (mean score) Office for National Statistics Cancer Mortality Key health outcome indicator. Age standardised cancer mortality rate (excluding non-melanoma skin cancer) per 100,000 people England: Cancer Research UK Wales: Welsh Cancer Intelligence and Surveillance Unit Northern Ireland: Northern Ireland Cancer Registry Scotland: Cancer Research UK Premature Cardiovascular Mortality Key health outcome indicator. Age standardised CVD death rate pre age 75 per 100,000 people British Heart Foundation Northern Ireland data is calculated using the population weighted sum of old districts. Obesity Key risk factor. % of the population who are obese (BMI of 30 or above) England: Public Health England 5

Scotland: Scottish Health Survey Wales: Public Health Wales Observatory Northern Ireland: Health Survey Northern Ireland 2011/2012, calculated by splitting health board data across old government districts, then using population shares to estimate obesity rates for new government areas. Infant mortality Key health outcome. Deaths under the age of 1 per 1000 live births Office for National Statistics (some imputation for missing data) Health satisfaction Subjective measure of health status. % satisfied with their health Smoking Key risk factor. % who smoke regularly SAFETY & SECURITY Measures crime rates, road deaths, and feelings of safety. Methodological note: For the perceptions of personal safety data, England and Wales data is from the England and Wales Crime Survey (ONS). Data was calculated using 2014 mid year population estimates by sex to weight gender responses to produce an aggregate figure for each region. Scotland data is from the Scottish Crime Survey. Data is collected by Police Division and was mapped onto corresponding Local Authority Areas: Aberdeen City: Aberdeen City Aberdeenshire and Moray: Aberdeenshire; Moray Argyll and West Dunbartonshire: Argyll and Bute; West Dunbartonshire Ayrshire: East Ayrshire; North Ayrshire; South Ayrshire Dumfries and Galloway: Dumfries and Galloway Edinburgh: City of Edinburgh Fife: Fife Forth Valley: Stirling; Clackmannanshire; Falkirk Greater Glasgow: Glasgow; East Dunbartonshire; East Renfrewshire Highlands and Islands: Highland; Orkney; Shetland; Hebrides Lanarkshire: North Lanarkshire; South Lanarkshire Renfrewshire and Inverclyde: Renfrewshire; Inverclyde Tayside: Dundee; Perth and Kinross; Angus The Lothians and Scottish Borders: Midlothian; West Lothian; East Lothian; Scottish Borders Northern Ireland data is from the NI Crime Survey. A note on crime rates: estimated crime rates are not available for the whole UK by local authority level. Recorded crime is the next best measure, though it is not a perfect measure of actual crime as it depends on detection rate. Safe walking Perceptions of personal safety. % who feel safe walking alone at night See methodological note Coverage: England & Wales (regions), Scotland & Northern Ireland (local unitary authority) 6

Perception of community safety Perceptions about the safety of local public areas. % who have felt unsafe in public in the last 12 months Road deaths Records road safety (road deaths are one of the biggest causes of death for young people). People killed or seriously injured in a road traffic collision per 100,000 people GB, Department for Transport, Northern Ireland, PSNI Violent crime Records the rate of serious crime, including homicide, attempted murder, and rape. Number of violent crimes recorded per 10,000 people. Scottish Government, Office for National Statistics, PSNI Theft Records the rate of theft, including housebreaking, vehicle theft, and shoplifting. Number of thefts recorded per 10,000 people Scottish Government, Office for National Statistics, PSNI SOCIAL CAPITAL Measures social network strength, social norms, community participation, and trust. Strong communities and social support are important for wellbeing and prosperity. High levels of trust have been linked to higher economic growth. Housing affordability is also measured, as owner-occupancy is a strong predictor of social capital as those who live permanently in an area are more likely to engage in community activity. Recycling rate Captures local recycling rates, a good proxy for the extent to which a community observe social norms (bridging social capital). % waste that is recycled, composted, or reused (NI 192) England & Wales: DEFRA Scotland: Environment Scotland Northern Ireland: Department of the Environment Calculated as (total household waste recycled, composted or reused)/(total household waste)*100 Data for Balbergh (Suffolk) is missing Suffolk data point calculated based on remaining 6 Local Authorities. Dorset collecting authorities (excluding Bournemouth and Poole) have formed the Dorset Waste Partnership and data is given for this single area. Volunteering Measure of social and civic participation (bridging social capital). % population who have volunteered within the last month England: ONS Community Life Survey Scotland: Scottish Household Survey Wales: Welsh Government Northern Ireland: NISRA Coverage: UK, NUTS1 7

8 Voter turnout Measure of civic participation (linking social capital). Turnout % (registered electors) last scheduled local council election (excluding General Election years) Electoral Commission (pre 2016), individual local authorities 2016 Trust Measure of generalised social trust (bridging social capital). % who think that people in general can be trusted Office for National Statistics Coverage: UK, NUTS1 Housing costs Housing is a strong predictor of social capital through owner-occupancy rates. % who have struggled to pay their mortgage or rent in the past 12 months Housing affordability Housing is a strong predictor of social capital through owner-occupancy rates. House price affordability ratio (average house price/median annual earnings) own calculation using ONS data Friendship support Key measure of individual social support (bonding social capital). % who feel they can rely on their friends if they have a problem Family support Key measure of individual social support (bonding social capital). % who feel they can rely on their family if they have a problem NATURAL ENVIRONMENT Measures impact on the natural environment, quality of the environment, and efforts to protect it. Waste generated Measure of impact on the environment. Waste per head generated per year (kgs) England & Wales: DEFRA Scotland: Environment Scotland Northern Ireland: Department of the Environment Landfill Measure of impact on the environment.

% local authority managed waste tonnage sent to landfill and tonnage non EfW incinerated England & Wales: DEFRA Scotland: Environment Scotland Northern Ireland: Department of the Environment Coverage: UK, local authority (county) level We assume that where waste from multiple district or unitary authority areas is managed by a single disposal authority, the treatment of that waste is the same regardless of collection area. Air pollution Measures the quality of the environment we live in. Population-weighted annual mean anthropogenic PM2.5 concentration (ugm-3) DEFRA Northern Ireland data is calculated using the population weighted sum of old districts Protected land Records the extent to which local natural assets are protected (e.g. national parks, biosphere reserves, sites of special scientific interest, areas of outstanding natural beauty). Also serves as a proxy for local access to protected land. % land area that has statutory protection own calculation based on national register of protected sites 9