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Living in the endless city

What will the world look like in 2050, when 75 per cent of the population live in cities?

With half of the seven billion people on earth living in cities, a substantial proportion of global GDP will be invested in energy and resources to accommodate a mass of new city dwellers over the next decades. The form of this new wave of urban construction and the shape of our
cities will have profound impacts on the ecological balance of the planet and the human conditions of people growing up and growing old in cities. As engines of the global economy, cities and their regions continue to produce, consume and pollute more than ever before, attracting more people to urban jobs and opportunities across the world.

Social reformers in Europe and North America in the late nineteenth and early twentieth centuries were preoccupied by similar concerns following the Industrial Revolution. At a considerably slower pace and smaller scale than the current wave of global urbanization, London grew from one million to become the world's first megacity. Today, Lagos, Delhi and Dhaka are growing by over 300,000 people a year. Mumbai (where more than half the inhabitants live in slums) is set to overtake Tokyo and Mexico City as the world's largest city in the next few decades.

The unpalatable reality is that cities are becoming more spatially fragmented, more socially divisive and more environmentally destructive.

However, governments, public agencies and the private sector are driving change to improve the living conditions of existing and new city dwellers. In Istanbul, the ­government is building three million housing units over 20 years. Rows of bland, 20-storey tower blocks surrounded by tarmac are emerging, reminiscent of the alienating social housing projects built across Europe and the United States in the mid-twentieth century.

Some of these have since been demolished because of their social dysfunctionality, yet the same ubiquitous typology continues to be erected around the world. Despite a recent slowdown, São Paulo continues its march towards endless sprawl, with four-hour commuting deemed acceptable in a city that accepts about 1,000 new cars on its streets every day. Mumbai's attempts to redevelop Dharavi, India's largest slum, raises the spectre of the 1960s "slum clearance" programmes that devastated the social life and urban structure of so many European and American cities.

With a population share of 53 per cent occupying less than 2 per cent of the earth's surface, urban areas concentrate 80 per cent of global economic output, between 60 and 80 per cent of global energy consumption, and approximately 75 per cent of CO2 emissions. Seventy-five per cent of the world's population is expected to be concentrated in cities by 2050 - a large proportion in megacities of several million people each and massively urbanised regions stretching across countries and continents. These patterns are not equally distributed across the globe. Cities in developing countries in Asia, Africa and Latin America continue to grow due to high birth rates and migration, while some rural settlements are transformed into urban regions. However, some cities of largely urbanised developed countries - such as Berlin, Milan and Moscow - have had to adapt to economic restructuring with shrinking populations, while others - such as New York, Los Angeles and London - have benefited from an influx of mainly foreign migrants.

While urbanisation has helped reduce absolute poverty, the number of people classified as urban poor is on the rise. Between 1993 and 2002, 50 million poor people were added to urban areas, while the number of rural poor declined by 150 million. Urban growth puts pressure on the local environment that disproportionately affects disadvantaged people. Many live in precarious structures in ­vulnerable locations such as riverbanks and drainage systems, exposed to hazards linked to climate change. Regular flooding in São Paulo, Istanbul and Mumbai - not to mention New Orleans or Jakarta - indicates the immediacy of the problem.

As cities' economies become more prosperous, with wider and deeper patterns of consumption and production, environmental footprint is increasingly felt at a global level. In carbon emissions, energy, electricity and water consumption, dwelling and transport patterns, there is a marked difference between cities in developed and developing countries. Cities in Europe, the US and Brazil, for example, have a lower environmental impact than their respective countries, but cities in India and China have a much larger impact owing to their significantly higher income levels compared with their national averages.

From an economic perspective, cities bring people and goods closer together, help overcome information gaps, and enable idea flows. National development of countries has always been linked to the growth of their cities.

Mirroring their economic performance, as cities grow in size, they leave a strong imprint on the planet. The World Bank has estimated that, while urban populations in the developed world have grown only about 5 per cent, their built-up area has increased by 30 per cent between 1990 and 2000. For developing world cities, the growth of populations was 20 per cent, against a 50 per cent increase in urbanised land. Annually, the amount of built-up land per person has increased by 2.3 per cent in cities in industrialised nations and 1.7 per cent in developing world cities. The "endless city" is not simply a metaphor, but a description of a real physical phenomenon.

Even though fuel is no longer cheap, Mexico City is spending most of its transport budget on the Segundo Piso, a double-decker flyover in the middle of the city. Mumbai is investing millions of dollars in the much disputed Bandra-Worli sea link across one of its stunning bays. Meanwhile, Boston has invested over $5bn on the Big Dig, demolishing the 1960s elevated motorway that scarred the centre for decades; many others have followed suit.

There is growing evidence that urban environments with higher-density residential and commercial buildings, and a well-distributed mix of public transport reduce the energy footprint. Research has shown that the so-called "compact city" model - Copenhagen or Barcelona - has lower per-capita carbon emissions as long as good public transport is provided at the metropolitan and regional level. Despite this, the majority of cities globally are ­following the less sustainable model of urban growth. A handful of pioneers, such as Seattle, Singapore or Bogota are implementing radical policies that dramatically reduce their energy footprint and commuting times and improve quality of life.

On balance, city dwellers do better than their rural cousins. They get jobs, earn and produce more. They can have better access to education and health. They can more easily become part of a networked, global society. But they consume and pollute more. They are exposed to extreme floods, violence, disease and wars. Many live without rights to land, shelter or votes, trapped in social and spatial exclusion.

Ultimately, cities can both brutalise and humanise people and the environment. Which way they go depends on governance and leadership. City leaders have an opportunity to make a difference, building on the spatial and social DNA of their cities, rather than importing generic models that cater to the homogenising forces of globalisation. Rediscovering the fragile thread that links physical order to human behaviour will be the main task of a world where 75 per cent of us will be living in cities.

Ricky Burdett is Professor of Urban Studies at the London School of Economics and co-editor, with Deyan Sudjic, of "Living in the Endless City", recently published by Phaidon

This article first appeared in the New Statesman supplement 'Competition in a New Society: Cities and Regions'

This article first appeared in the 28 November 2011 issue of the New Statesman, The rise of the muslim brotherhood

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Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.