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theoharris.bsky.social

@theoharris.bsky.social
86 followers 215 following 82 posts

Advocating for a better economics @ New Economics Foundation

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Andrew Sissons @acjsissons.bsky.social · 12/05/2026
Haigh’s essay here is well worth reading. This is not some MMT-adjacent treatise - it genuinely engages with the constraint.
It is therefore possible for two things to be true at once: that the current institutional framework is ill-suited to supporting long-term growth, and that the immediate constraint on
government action is the cost of borrowing in financial markets. A credible reform agenda must address both - improving the framework over time while demonstrating, in the near term, that public investment will strengthen, rather than weaken, fiscal sustainability.
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theoharris.bsky.social @theoharris.bsky.social · 14/01/2026
^^am currently working on a project developing a proposal and estimating the impact. Overall, I'd say the NWF needs to be a lot bigger anyway (x4 increase to be on par with French/German equivalents). So imo there's no reason for it not to invest in fixed offshore, as well as networks and floating!
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theoharris.bsky.social @theoharris.bsky.social · 14/01/2026
Meanwhile, on CfDs, if NWF could roll out a standardised credit guarantee or concessional loan offering to qualifying offshore wind projects, this could in theory lower WACC significantly and lead to lower bids across the board. A 5-10% lower strike price for 20 years would be a giant saving!
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theoharris.bsky.social @theoharris.bsky.social · 14/01/2026
Ofgem's RIIO-3 framework makes assumptions for TNO cost of debt by taking a generic benchmark for corporate bonds, and compensates them accordingly from bills. So NWF intervention to reduce cost of debt won't necessarily translate directly to lower bills, even if it lowers TNO financing costs
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theoharris.bsky.social @theoharris.bsky.social · 14/01/2026
Interestingly, the NWF is already co-investing with TNOs into transmission projects (e.g. recent £800m guarantee for SSEN). This will help projects get built faster, maybe reducing system balancing costs, but it won't directly reduce consumer network costs via a cost-of-capital effect
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theoharris.bsky.social @theoharris.bsky.social · 14/01/2026
Still an 11% increase to this round! IMO it’s a missed opportunity for the National Wealth Fund to intervene and lower capital costs (a 150bps wacc reduction can bring LCOE down by >10%).
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theoharris.bsky.social @theoharris.bsky.social · 14/01/2026
Btw I think it was £58.87 in 2012 prices for new fixed bottom floating in AR6 - £54.23 was for the permitted reductions I believe
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theoharris.bsky.social @theoharris.bsky.social · 22/10/2025
2) The Bank of England cutting rates in November would lead to: more jobs for workers, lower interest payments for borrowers, more business investment (especially in the green transition), and less pressure on the government’s spending plans.
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theoharris.bsky.social @theoharris.bsky.social · 22/10/2025
What does this all mean? 1) Prices are now rising at a low and acceptable level on average – this is great news for the millions of people still struggling from the cost of living crisis.
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theoharris.bsky.social @theoharris.bsky.social · 22/10/2025
If you combine this with the recent data suggesting that the jobs market is suffering under the BoE’s high interest rates (i.e. the intended goal – hooray?) there is a convincing data-driven case for the Bank of England to lower interest rates when the Monetary Policy Committee meet in November.
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theoharris.bsky.social @theoharris.bsky.social · 22/10/2025
The Apr-Sep metric is much more relevant than the 12-month figure for understanding: a) how quickly prices are actually rising at the moment [answer: in line with 2% target] , and b) how the 12-month CPI rate is likely to move going forwards [answer: on track for seeing a major drop in April 2026].
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theoharris.bsky.social @theoharris.bsky.social · 22/10/2025
A lot of this difference is driven by the large bump in regulated prices (e.g. water and energy bills) in April this year. Once you set those aside by focusing only on April-September, CPI on the whole is actually increasing at around 1.9% per year i.e. in line with the BoE’s 2% target.
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theoharris.bsky.social @theoharris.bsky.social · 22/10/2025
Current inflation is actually much lower than the headlines and most media commentary would seem to imply. Yes the CPI did rise by 3.8% in the 12 months from October 2024 to September 2025. But since April, CPI has only been rising at an annualised rate of 1.9%.
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theoharris.bsky.social @theoharris.bsky.social · 25/09/2025
I'm glad NEF are are one of 11 NGOs calling today for the Bank of England to stop holding back the green transition. IMHO the Bank's outdated narrow-mindedness has led to an intransigence which is undermining not only the transition, but the UK's chances of economic prosperity and stability.
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New Economics Foundation @neweconomics.bsky.social · 11/08/2025
Our framework for tackling inflation is damaging the economy - we need a more targeted and proactive approach. @theoharris.bsky.social was on the Standard podcast to talk about interest rates, inflation and growth
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theoharris.bsky.social @theoharris.bsky.social · 29/07/2025
If the BoE is serious about fulfilling its legal mandates to ensure financial stability and support government economic policy, it now has little excuse not to follow the ECB’s example and implement similar measures!
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theoharris.bsky.social @theoharris.bsky.social · 29/07/2025
Meanwhile, @bankofengland.bsky.social has so far refused to implement similar measures on corporate bonds in its own collateral framework. In fact, heavy-emitting companies are effectively being subsidised by the BoE’s “carbon-bias”.
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theoharris.bsky.social @theoharris.bsky.social · 29/07/2025
3) It will demonstrate to investors that EU regulators will align themselves with EU and international climate law. This message will affect the decisions of many financial actors far beyond those who are immediately impacted.
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theoharris.bsky.social @theoharris.bsky.social · 29/07/2025
1) It will reduce its own losses in the event that these bonds suddenly lose value. 2) It will make it less attractive for financial institutions to buy these bonds in the first place, which in turn will make it more expensive for dirty companies to borrow money.
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theoharris.bsky.social @theoharris.bsky.social · 29/07/2025
An example of this are fossil fuel companies like Shell and BP who are still expanding their fossil fuel operations in contradiction to the Paris agreement. By saying it will loan less money in exchange for bonds issued by such companies, the ECB will achieve three things:
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theoharris.bsky.social @theoharris.bsky.social · 29/07/2025
In referring to “climate-related transition risks”, the ECB is talking about the risks faced by companies who are not aligning themselves with the green transition, who could suddenly see a big drop in value when future climate legislation or behavioural shifts come into effect.
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theoharris.bsky.social @theoharris.bsky.social · 29/07/2025
This is a huge step in reducing the risks that climate change poses to the financial system, that we have been calling for since 2021! neweconomics.org/2021/03/gree...
neweconomics.org
Greening the Eurosystem collateral framework
How to decarbonise the ECB’s monetary policy
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theoharris.bsky.social @theoharris.bsky.social · 29/07/2025
Big climate news from the European Central Bank: @ecb.europa.eu announced today that it will introduce a climate-factor into how it values the corporate bonds that financial institutions pledge as collateral in return for ECB loans.
ecb.europa.eu
ECB to adapt collateral framework to address climate-related transition risks
The European Central Bank (ECB) is the central bank of the European Union countries which have adopted the euro. Our main task is to maintain price stability in the euro area and so preserve the purchasing power of the single currency.
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theoharris.bsky.social @theoharris.bsky.social · 17/07/2025
I described exactly what I wanted to depict, and chatgpt produced the image. But am thinking a lot about whether, in general, it would be a more ethical practice to commission a human illustrator. Keen to hear thoughts!
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theoharris.bsky.social @theoharris.bsky.social · 17/07/2025
Thought I would try my hand at AI-powered satirical cartooning, in reaction to this government's rhetoric about the role of the financial sector and the need to de-regulate.
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theoharris.bsky.social @theoharris.bsky.social · 07/07/2025
So this time round, I’m holding back on praising the ECB until we see some concrete policy measures, particularly removing disproportionate fossil fuel support from the collateral framework and introducing green refinancing operations. More detail in the blog!
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theoharris.bsky.social @theoharris.bsky.social · 07/07/2025
But though the ECB announced an ambitious climate roadmap back in 2021, since then it has had a chequered track record on how monetary policy decisions have affected the green transition.
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theoharris.bsky.social @theoharris.bsky.social · 07/07/2025
Even better, the new language also includes reference to nature degradation – which poses huge financial and economic concerns, as much research has shown.
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theoharris.bsky.social @theoharris.bsky.social · 07/07/2025
It was good to see that, in its updated strategy statement last week, the ECB stuck with scientific consensus and kept its strong language about climate change.
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theoharris.bsky.social @theoharris.bsky.social · 07/07/2025
I just published a blog for NEF on the European Central Bank’s track record on climate! neweconomics.org/2025/07/as-e... #climatepolicy #monetarypolicy #ECB
neweconomics.org
As Europe burns, can the ECB turn words into action on green policy?
The European Central Bank’s updated strategy reaffirms its support for climate policy, but it has a mixed track record when it comes to concrete actions
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theoharris.bsky.social @theoharris.bsky.social · 30/06/2025
The ECB must turn its compelling arguments on climate and nature into concrete policy action. In the last few years we've seen: ⌚ constant delays on greening the collateral framework 🔻 high rates brutalising the renewables industry 💨 green tilting made redundant by QT Time to put this right!
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theoharris.bsky.social @theoharris.bsky.social · 19/06/2025
Those blaming Reeves entirely for jobs cuts forget to mention that the Bank of England is purposefully trying to increase unemployment and depress wage-growth. Our outdated inflation-targeting framework is completely inept for dealing with supply-side shocks; and workers always pay the price.
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theoharris.bsky.social @theoharris.bsky.social · 16/06/2025
Wrote a briefing for @NEF about how Europe needs an ambitious, coordinated, and long-termist macroeconomic approach in order to achieve its goals in this age of shocks and challenges. Whereas current policy is incremental, piecemeal, and short-termist... neweconomics.org/2025/06/a-co...
neweconomics.org
A coordinated macroeconomic framework for Europe
EU macroeconomic policy in an age of shocks and the case for monetary-fiscal coordination
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Reposted by @theoharris.bsky.social
New Economics Foundation @neweconomics.bsky.social · 13/06/2025
“To deliver the change people voted for, the government should free itself from its self-imposed fiscal rules, recognise the value of social spending and be willing to tax wealth fairly” NEF's @theoharris.bsky.social in @theguardian.com #SpendingReview analysis. www.theguardian.com/education/20...
theguardian.com
Councils in England warn of mass bankruptcies as Send deficits soar
Local authorities say a £5bn shortfall in special needs funding could leave dozens effectively insolvent within months
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theoharris.bsky.social @theoharris.bsky.social · 12/06/2025
Those departmental spending figures actually exclude the ring-fenced covid-19 expenditure! The main reason for the difference overall is probably that interest rates were lower in 2021. Now interest rates are high, it's harder to increase dept. spending w/out changing fiscal rules / raising taxes.
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theoharris.bsky.social @theoharris.bsky.social · 12/06/2025
I think it's great that there's a spending boost for the NHS and for education, and higher capital investment all round. But this has essentially come at the expense of not increasing (or even cutting) spending in the other departments. In aggregate, not exactly national renewal.
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theoharris.bsky.social @theoharris.bsky.social · 04/06/2025
Had my first live radio interview on Sunday morning! Hopefully I said something sensible about resilience and protecting the hardest-off from global economic shocks…
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Invest In Britain @investinbritain.bsky.social · 02/06/2025
🧵New polling from @investinbritain.bsky.social by @survation.bsky.social reveals a majority of Labour MPs want the Chancellor to change course on fiscal policy. 1/8 thetimes.com/article/6448...
thetimes.com
Majority of Labour MPs oppose Rachel Reeves’s fiscal rules
Divisions within the party are exposed as two thirds of MPs are against the Rachel Reeves’ fiscal plans
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theoharris.bsky.social @theoharris.bsky.social · 23/05/2025
Overall, appropriately targeted government borrowing is a good thing that enables us to invest in the vital services and infrastructure that form the foundation of our economy. Responsible countries, like responsible businesses, borrow to invest in their future productivity.
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theoharris.bsky.social @theoharris.bsky.social · 23/05/2025
What is a cause for alarm is that the Treasury had to pay £4.1bn to the Bank of England to cover the losses made on QE. This is part of a series of payments estimated to cost the country over £20bn per year until 2029. This relationship must be immediately re-assessed.
neweconomics.org
Bank of England’s quantitative tightening could cost Treasury over £96bn over next four years
Adopting a speed of "quantitative tightening" similar to the pace in the Eurozone and the US could save the taxpayer £13.5bn a year.
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theoharris.bsky.social @theoharris.bsky.social · 23/05/2025
Yesterday's UK government borrowing figures for April were actually £3.5bn below the OBR’s forecast, yet media coverage focused on the fact that the figure was slightly higher than the forecasts of “city economists”. This is not a cause for alarm. obr.uk
obr.uk
Home - Office for Budget Responsibility
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Jens van 't Klooster 💸💸💸 @jvtk.bsky.social · 05/05/2025
My new report on the question: Should the ECB pretend that 2022 never happened? Short answer: no
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theoharris.bsky.social @theoharris.bsky.social · 28/04/2025
Last day of our fundraiser towards tackling extreme wealth, to defend democracy and the planet. All donations to support this work are being doubled!
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theoharris.bsky.social @theoharris.bsky.social · 23/04/2025
Really exciting event we have coming up in Brussels on May 15th! What macroeconomic approach does the EU need in order to meet its economic goals in this new era of shocks? We'll hear from Swati Dhingra of the Bank of England, and two expert panels chaired by @paolatamma.bsky.social
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Jesse Griffiths @jesselgriffiths.bsky.social · 11/04/2025
At the end of a slightly terrifying week, where a major financial crisis was averted – for now – I thought I’d reflect on whether such a crisis might happen anyway, and what this means for UK financial sector policy. A thread. /1
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theoharris.bsky.social @theoharris.bsky.social · 19/03/2025
Would love to hear any thoughts on the paper!
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theoharris.bsky.social @theoharris.bsky.social · 19/03/2025
Increasing public investment is especially important given that the UK's investment banks aren't yet close to providing the level of support we used to get from the European Investment Bank - as shown by this great data from @ukandeu.bsky.social
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theoharris.bsky.social @theoharris.bsky.social · 19/03/2025
No! It’s the role of the NWF – in cooperation with other areas of government policy – to make sure those investments come about. So, the NWF can’t simply inherit UKIB’s overly passive and restricted framework; it needs a more proactive approach to take full advantage of its investment capacity.
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theoharris.bsky.social @theoharris.bsky.social · 19/03/2025
Looking forward to the NWF’s performance, you have to ask: for the institution tasked with driving forwards the industrial strategy and revitalising the economy, would it be good enough to leave £bns of its budget unspent and simply blame the economy for a lack of investment opportunities?
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theoharris.bsky.social @theoharris.bsky.social · 19/03/2025
In part, factors outside its investment approach can explain UKIB’s underinvestment. Given the state of the economy, there was a shortage of private sector green infrastructure projects that met UKIB’s criteria to receive investment support. But that also points to a problem with the criteria...
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