The coalition is still failing business

The government's enterprise bill provides no evidence of a clear strategic direction.

Today the Enterprise and Regulatory Reform Bill receives its second reading in the House of Commons.  It was trailed in the days before the Queen’s Speech as the centrepiece of a legislative programme by the government built on “growth, justice and constitutional reform”.  In reality, it is anything but.

The bill is a good illustration of the weaknesses and divisions at the heart of the government. The most pressing issue facing Britain is the fact that the economy has gone into reverse. The Prime Minister and Chancellor may wish to hide behind the fact that there is a eurozone crisis, or that we had too many days off because of the Queen’s diamond jubilee, or that the weather is slightly too cold or too hot, or – at the moment – too much rain. But everyone else seems to realise, with the exception of the occupants of 10 and 11 Downing Street, that their insistence on cutting spending and raising taxes too far and too fast, and thereby choking off demand in the domestic economy, has plunged this country back into a recession made in Downing Street. What we need is a proper plan for jobs and growth to get the economy going again – like Labour’s five-point plan.

Only in the last few days, President Obama has implicitly criticised the government’s stance, noting that it is a lot harder to rein in deficits and debt if your economy is not growing.  Tellingly, he singled out Angela Merkel and François Hollande for “working to put in place a growth agenda alongside responsible fiscal plans”. No such praise for David Cameron or George Osborne.

There is no magic piece of legislation that would conjure up growth. But the case for a British Investment Bank needs to be examined, as Labour is doing.  Reforms to allow firms to better plan for the long-term, invest in new plant and skills and ensuring that there are more, better paid jobs so the economy works for more people, more of the time would also improve Britain’s competitiveness and allow us to get back into growth much more quickly.

In the longer-term, the bill provides no evidence of a clear strategic direction.  Business is crying out for a stable policy environment to allow them to invest and plan for the long-term; a proper industrial strategy, based on the long-term to encourage sustainable growth, but this bill has failed to provide this.

We have in the bill the establishment of the Green Investment Bank, a welcome initiative that Labour announced back in 2010, but it won’t have powers to lever in private money to boost green investment until 2016. 

There are reforms designed to make executive pay more accountable and transparent, but ministers are refusing to implement all of the sensible recommendations from the High Pay Commission such as putting an employee representative on remuneration committees – and now it appears that Vince Cable is seeking to water down provisions for annual shareholder votes on executive pay.

The bill includes reforms to employment legislation. There are some changes on tribunals which are worth exploring but, in a nod and a wink to the Tory right, the government is hinting that it could bring forward amendments during the bill’s passage to put Beecroft’s fire at will manifesto on the statute book, alongside other proposals within the bill to water down the rights we enjoy at work.

Cable lamented in his leaked letter to the Prime Minister that the government has lacked a compelling vision on where it wants to take the country’s economy by 2020.  With this bill had an opportunity to rectify this and provide the strategic vision which British business is crying out for, leaving a lasting legacy that would boost economic recovery and secure Britain’s competitiveness in the next decade. Faced with the roadblocks to reform in Downing Street, it is a great shame this opportunity has been missed.

The Chancellor continues to "hide behind the fact that there is a eurozone crisis". Photograph: Getty Images.

Iain Wright is the shadow minister for competitiveness and enterprise.

Photo: Getty
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The Prevent strategy needs a rethink, not a rebrand

A bad policy by any other name is still a bad policy.

Yesterday the Home Affairs Select Committee published its report on radicalization in the UK. While the focus of the coverage has been on its claim that social media companies like Facebook, Twitter and YouTube are “consciously failing” to combat the promotion of terrorism and extremism, it also reported on Prevent. The report rightly engages with criticism of Prevent, acknowledging how it has affected the Muslim community and calling for it to become more transparent:

“The concerns about Prevent amongst the communities most affected by it must be addressed. Otherwise it will continue to be viewed with suspicion by many, and by some as “toxic”… The government must be more transparent about what it is doing on the Prevent strategy, including by publicising its engagement activities, and providing updates on outcomes, through an easily accessible online portal.”

While this acknowledgement is good news, it is hard to see how real change will occur. As I have written previously, as Prevent has become more entrenched in British society, it has also become more secretive. For example, in August 2013, I lodged FOI requests to designated Prevent priority areas, asking for the most up-to-date Prevent funding information, including what projects received funding and details of any project engaging specifically with far-right extremism. I lodged almost identical requests between 2008 and 2009, all of which were successful. All but one of the 2013 requests were denied.

This denial is significant. Before the 2011 review, the Prevent strategy distributed money to help local authorities fight violent extremism and in doing so identified priority areas based solely on demographics. Any local authority with a Muslim population of at least five per cent was automatically given Prevent funding. The 2011 review pledged to end this. It further promised to expand Prevent to include far-right extremism and stop its use in community cohesion projects. Through these FOI requests I was trying to find out whether or not the 2011 pledges had been met. But with the blanket denial of information, I was left in the dark.

It is telling that the report’s concerns with Prevent are not new and have in fact been highlighted in several reports by the same Home Affairs Select Committee, as well as numerous reports by NGOs. But nothing has changed. In fact, the only change proposed by the report is to give Prevent a new name: Engage. But the problem was never the name. Prevent relies on the premise that terrorism and extremism are inherently connected with Islam, and until this is changed, it will continue to be at best counter-productive, and at worst, deeply discriminatory.

In his evidence to the committee, David Anderson, the independent ombudsman of terrorism legislation, has called for an independent review of the Prevent strategy. This would be a start. However, more is required. What is needed is a radical new approach to counter-terrorism and counter-extremism, one that targets all forms of extremism and that does not stigmatise or stereotype those affected.

Such an approach has been pioneered in the Danish town of Aarhus. Faced with increased numbers of youngsters leaving Aarhus for Syria, police officers made it clear that those who had travelled to Syria were welcome to come home, where they would receive help with going back to school, finding a place to live and whatever else was necessary for them to find their way back to Danish society.  Known as the ‘Aarhus model’, this approach focuses on inclusion, mentorship and non-criminalisation. It is the opposite of Prevent, which has from its very start framed British Muslims as a particularly deviant suspect community.

We need to change the narrative of counter-terrorism in the UK, but a narrative is not changed by a new title. Just as a rose by any other name would smell as sweet, a bad policy by any other name is still a bad policy. While the Home Affairs Select Committee concern about Prevent is welcomed, real action is needed. This will involve actually engaging with the Muslim community, listening to their concerns and not dismissing them as misunderstandings. It will require serious investigation of the damages caused by new Prevent statutory duty, something which the report does acknowledge as a concern.  Finally, real action on Prevent in particular, but extremism in general, will require developing a wide-ranging counter-extremism strategy that directly engages with far-right extremism. This has been notably absent from today’s report, even though far-right extremism is on the rise. After all, far-right extremists make up half of all counter-radicalization referrals in Yorkshire, and 30 per cent of the caseload in the east Midlands.

It will also require changing the way we think about those who are radicalized. The Aarhus model proves that such a change is possible. Radicalization is indeed a real problem, one imagines it will be even more so considering the country’s flagship counter-radicalization strategy remains problematic and ineffective. In the end, Prevent may be renamed a thousand times, but unless real effort is put in actually changing the strategy, it will remain toxic. 

Dr Maria Norris works at London School of Economics and Political Science. She tweets as @MariaWNorris.