Three reasons to welcome the Sharing Economy Review
Just eight weeks after the government announced the launch of a review into the sharing economy, the project’s findings have been published in a report: Unlocking the Sharing Economy. Led by Debbie Wosskow, CEO of Love Home Swap, the review was tasked with examining some of the key policy challenges raised by the sharing economy and assessing its future potential. The report makes 35 recommendations covering areas such as regulation, taxation and how to encourage innovation and investment in the sector. Yet most interesting was the inclusion of three themes that have typically received less attention.
Trust and Identity
The report rightly notes that the success of the sharing economy – and particularly peer-to-peer businesses – will depend on consumer trust. A major part of building that trust will entail providing assurance that those who buy and sell services online are who they say they are. It was therefore pleasing to see Policy Exchange’s recommendation that the GOV.UK Verify scheme (that enables citizens to prove their identity via a trusted third party, such as Experian) be made available to the private sector. This will provide a far more robust system for identity assurance than the practice of signing up via social media sites such as Facebook or Twitter. In a similar vein, for sharing economy businesses offering transportation services, Wosskow’s suggestion that the DVLA open up APIs to access their data could help provide confidence that drivers are appropriately licensed and insured. This is already possible over the phone; providing the service digitally will be more cost effective for the DVLA and ensure that checks can be conducted quickly and easily.
Public sector benefits
It was positive to see the report’s inclusion of ideas that could benefit the public sector. For example, Wosskow recommends that government bodies should ensure their procurement policies let their staff make use of sharing economy services, such as when they need transport between office locations. There may also be potential for public bodies to offer their own resources for hire, such as spare or underused office space and vehicles. This could benefit the public while providing some parts of the public sector with an additional income stream.
The report also includes recommendations on how the sharing economy could help address some of the most pressing challenges facing the UK’s towns and cities. First, it suggests that owners of non-residential properties should be able to hire out parking spaces without requiring planning permission. For politicians worrying about how to rejuvenate the UK’s high streets, this measure could help increase parking capacity in town centres and encourage more shoppers to visit at weekends, providing a boost to the local economy.
Second, as cities like London seek to address growing traffic congestion, the recommendation that the GLA coordinate car club parking spaces across boroughs may help drive up use of car pooling services. Enabling the public to pay for them with Oyster cards or TfL’s contactless payment mechanism could likewise encourage uptake.
Third, the review also hinted at the role the sharing economy could play in the development of smart cities. While much public debate on smart cities focuses on how local and city governments will use technology, it is important to consider how citizens themselves will use it to change their behaviour, and the impact this will have on city design. Wosskow calls for pilots of ‘sharing cities’ where new urban areas are constructed with collaborative consumption in mind. For example, residential or office areas could be built with dedicated space for car club bays such as ZipCar or easyCar Club. (This is a theme that Debbie will expand upon during Policy Exchange’s upcoming conference on Smart Cities on 16 December.)
Digital and Social Inclusion
The sharing economy has the potential to benefit those from lower income groups by offering access to some assets without having to own them (e.g. a car), and also by enabling them to sell their skills online. However, those on low incomes are also the most likely to be digitally excluded. According to the Tinder Foundation, 44% of the estimated 11 million people who lack basic digital skills are from low income families. The report calls for government to continue to support the digitally excluded in getting online (a point echoed in Policy Exchange’s recent Technology Manifesto).
Thinking of social inclusion more broadly, if the government wants to realise its vision of creating a ‘generation of microentrepreneurs’ via the sharing economy, its benefits must not be limited only to those who own assets. For that reason, we would support the report’s recommendation to update the government’s model agreement for a shorthold tenancy, so that prohibiting tenants from subletting is no longer the default position. This would help more tenants in rented accommodation to ask landlords for permission to sublet spare rooms through sites such as AirBnB.
This review is certainly not a forensic analysis of the sharing economy (nor does it claim to be). However it has successfully brought together some of the big ideas that policymakers need to consider to maximise its positive impact. As governments around the world face increasing tensions with the sharing economy’s disruptive new business models, it is in everyone’s interests for the UK to tackle the key issues head-on.