Labour's tougher line on bonuses

Party steps up the rhetoric but will it win back voters?

From the Labour conference

Alistair Darling's speech this afternoon was another example of the harsher line Labour ministers have taken on bank bonuses at the conference.

He promised that the new "clawback" system planned by the government would end the "reckless culture that puts short-term profits over long-term success". He also said: "It will mean an end to automatic bank bonuses year after year. It will mean an end to immediate payouts for top management."

But will it help lift Labour's dismal poll ratings? Today's ComRes poll for the Independent put the party level with the Lib Dems on 23 per cent, with the Tories on 38 per cent. Even allowing for the Lib Dems' standard post-conference bounce this is a remarkably low level of support.

Labour's best hope probably does lie in a populist stance on bonuses and extravagant salaries, with more measures such as the popular 50p income-tax rate. The test will be whether the party offers sufficiently distinct policies from the Tories.

I'd expect David Cameron and George Osborne to promise similarly tough action on bonuses in Manchester next week. The election success of Angela Merkel's Christian Democrats, who won by tacking to the left on bonuses and pay, is likely to concentrate Conservative minds.

I'm off to hear Ed Miliband in conversation with Steve Richards this afternoon, but it's his brother who's been garnering favourable headlines today.

The ComRes poll I mentioned earlier found that Labour would perform better at the next election under David Miliband than any other alternative leader, with the exception of Jack Straw. Under either of the two, Labour would be the largest party in a hung parliament, opening the way for a coalition with the Lib Dems.

Miliband is certainly enjoying a better conference than last year. His address at last night's New Statesman party was confident, amusing and self-deprecating. He made light of the 2008 "banana incident" by quipping about the multiple photo opportunities this year's crop of fresh fruit stalls provides.

But those who suggest Miliband represents Labour's future forget that the trade unions continue to hold a third of the votes in Labour's electoral college. Many trade unionists regard the Foreign Secretary as little better than a Tory.

There's been less discussion of Straw's impressive performance in the poll, although in the past he's been spoken of as a possible caretaker leader. If Labour's defeat next year is as severe as some predict, its younger figures may wish to keep their powder dry until the party has regained ground.

George Eaton is political editor of the New Statesman.

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Everyone's forgotten the one issue that united the Labour party

There was a time when Ed Miliband spoke at Momentum rallies.

To label the row over the EU at Thursday’s Labour leadership hustings "fireworks" would be to endow it with more beauty than it deserves. Owen Smith’s dogged condemnation of John McDonnell’s absence from a Remain rally – only for Corbyn to point out that his absence was for medical reasons – ought to go down as a cringing new low point in the campaign. 

Not so long ago, we were all friends. In the course of the EU referendum, almost all of the protagonists in the current debacle spoke alongside each other and praised one another’s efforts. At a local level, party activists of all stripes joined forces. Two days before polling day, Momentum activists helped organise an impromptu rally. Ed Miliband was the headline speaker, and was cheered on. 

If you take the simple version of the debate, Labour’s schism on the EU appears as an aberration of the usual dynamics of left and right in the party. Labour's left is supposedly cheering a position which avoids advocating what it believes in (Remain), because it would lose votes. Meanwhile, the right claims to be dying in a ditch for its principles - no matter what the consequences for Labour’s support in Leave-voting heartlands.

Smith wants to oppose Brexit, even after the vote, on the basis of using every available procedural mechanism. He would whip MPs against the invocation of Article 50, refuse to implement it in government, and run on a manifesto of staying in the EU. For the die-hard Europhiles on the left – and I count myself among these, having run the Another Europe is Possible campaign during the referendum – there ought to be no contest as to who to support. On a result that is so damaging to people’s lives and so rooted in prejudice, how could we ever accept that there is such a thing as a "final word"? 

And yet, on the basic principles that lie behind a progressive version of EU membership, such as freedom of movement, Smith seems to contradict himself. Right at the outset of the Labour leadership, Smith took to Newsnight to express his view – typical of many politicians moulded in the era of New Labour – that Labour needed to “listen” to the views Leave voters by simply adopting them, regardless of whether or not they were right. There were, he said, “too many” immigrants in some parts of the country. 

Unlike Smith, Corbyn has not made his post-Brexit policy a headline feature of the campaign, and it is less widely understood. But it is clear, via the five "red lines" outlined by John McDonnell at the end of June:

  1. full access to the single market
  2. membership of the European investment bank
  3. access to trading rights for financial services sector
  4. full residency rights for all EU nationals in the UK and all UK nationals in the EU, and
  5. the enshrinement of EU protections for workers. 

Without these five conditions being met, Labour would presumably not support the invocation of Article 50. So if, as seems likely, a Conservative government would never meet these five conditions, would there be any real difference in how a Corbyn leadership would handle the situation? 

The fight over the legacy of the referendum is theatrical at times. The mutual mistrust last week played out on the stage in front of a mass televised audience. Some Corbyn supporters jeered Smith as he made the case for another referendum. Smith accused Corbyn of not even voting for Remain, and wouldn’t let it go. But, deep down, the division is really about a difference of emphasis. 

It speaks to a deeper truth about the future of Britain in Europe. During the referendum, the establishment case for Remain floundered because it refused to make the case that unemployment and declining public services were the result of austerity, not immigrants. Being spearheaded by Conservatives, it couldn’t. It fell to the left to offer the ideological counter attack that was needed – and we failed to reach enough people. 

As a result, what we got was a popular mandate for petty racism and a potentially long-term shift to the right in British politics, endangering a whole raft of workplace and legal protections along the way. Now that it has happened, anyone who really hopes to overcome either Brexit, or the meaning of Brexit, has to address the core attitudes and debates at their root. Then as now, it is only clear left-wing ideas – free from any attempt to triangulate towards anti-migrant sentiment– that can have any hope of success. 

The real dividing lines in Labour are not about the EU. If they were, the Eurosceptic Frank Field would not be backing Smith. For all that it may be convenient to deny it, Europe was once, briefly, the issue that united the Labour Party. One day, the issues at stake in the referendum may do so again – but only if Labour consolidates itself around a strategy for convincing people of ideas, rather than simply reaching for procedural levers.