What became of Blue Labour?

A year later, there's barely a sight of the buzzword. But its ideas live on, writes Rowenna Davis.

Whatever happened to Blue Labour? Last year I wrote a book about a term that was causing political circles to chatter . Now the name has almost dropped out of existence. Its founder, Lord Maurice Glasman, has effectively been under house arrest in the second chamber after a string of controversial outbursts, the latest on this website. But one year on, Blue Labour is still the rising philosophy of Ed Miliband’s party. The players, the relationships and the policies are having an effect. The name might not be there, but the influence is.

Ed Miliband’s conference speech is set to focus on “predistribution”. Although the term is diabolically policy-wonkish, the concept is spot on. The starting position of Blue Labour is that previous governments were too hands off with the market and too hands on with the state. Predistribution wants us to change that balance. If you force employers to pay the living wage for example, then you don’t have to worry about correcting in work poverty through tax credits. This is central to Blue Labour’s call on the party to value hard work and reduce dependency, and it’s supported by shadow minister Rachel Reeves in a new Fabian pamphlet outlining Miliband’s ideas.

Ed Miliband’s “responsible capitalism” is underpinned by this philosophy. Take the leader’s emphasis on energy companies. If we split up this oligopolistic market and force the companies to compete, we would encourage them to suck out less in profit and dedicate more revenue to improving their offer to customers. Crucially, that means there would be less demand for winter fuel allowance. Similarly, demanding workers’ representation on the boards of companies would give them the chance to challenge fat cat salaries, and call for more profits to be given in wages. Improving vocational education is another way of increasing wages without relying on state redistribution. In economic terms, it’s developing a supply side policy for the left. To your average voter, it’s a way of making a real difference to people’s lives without spending huge amounts of money.

It’s true to say that Glasman is not as close to Ed Miliband as he once was, but he remains tight with people who are. Lord Stewart Wood is a big fan of Germany’s model of worker representation and vocational education, and Marc Stears, one of Ed Miliband’s best friends from university, is working at the heart of the leader’s office. They are both longstanding friends of Glasman.

Meanwhile, Jon Cruddas MP has been chosen to lead Labour’s policy review. Cruddas has been one of the biggest fans of Blue Labour in the parliamentary party (not that this says much) and his close friend Jonathan Rutherford is very close with Glasman. Ed Miliband knew that when he made the appointment. Cruddas is already showing his Blue streak, particularly his call for a referendum on EU membership. We can also expect to see calls for a decentralisation of the state, and a focus on what kind of society we want to build together, rather than an obsession with what processes we want to get there. The conference slogan championed by Cruddas – “Rebuilding Britain” – came from Glasman before anyone else.

The third area where Blue Labour is influencing the party is less well known, but still highly important. A new man has come to work in Ed Milband’s team, focusing on party organisation. Arnie Graf has come from the United States with a long track record of community organising, which Glasman has always admired. Older and wiser than your frantic special adviser stereotype, his gentle but strong manner has won round people from surprising quarters in the party, and last year he was given permission to conduct a root and branch review of its organisation. His report was never published, but he called on the party to open up, raising the possibility of open primaries and less top down control from London. Now he’s taking leave from his work in the US to continue here, and he remains something of a trusted elder to the Labour leader. Few know that it was Glasman who first convinced Graf to come over from the US, and that he was personally responsible for introducing him to the Labour leader.

Whilst all this is happening, Lord Glasman is not sitting still or acting alone. Out of the media spotlight he’s beavering away, building alliances and making new friends. This summer a big conference was held on the “Common Good” – members of the green movement and women’s groups were there alongside MPs and faith groups to discuss how to take the agenda forward. Glasman is also forming links with unions, particularly those representing the private sector, about how they can work together. If that wasn’t enough, he’s also working with the people of Dover to stop the privatisation of their port. A perfect campaign for Blue Labour, it’s about reengaging with the South, supporting private sector workers and mutual ownership. The relationships, the policies, the players – there’s a lot going on. It might not be called Blue Labour, but a rose by another other name…

A ferry sails past the Port of Dover, site of some very Blue Labourish goings-on. Photograph: Getty Images

Rowenna Davis is Labour PPC for Southampton Itchen and a councillor for Peckham

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Stability is essential to solve the pension problem

The new chancellor must ensure we have a period of stability for pension policymaking in order for everyone to acclimatise to a new era of personal responsibility in retirement, says 

There was a time when retirement seemed to take care of itself. It was normal to work, retire and then receive the state pension plus a company final salary pension, often a fairly generous figure, which also paid out to a spouse or partner on death.

That normality simply doesn’t exist for most people in 2016. There is much less certainty on what retirement looks like. The genesis of these experiences also starts much earlier. As final salary schemes fall out of favour, the UK is reaching a tipping point where savings in ‘defined contribution’ pension schemes become the most prevalent form of traditional retirement saving.

Saving for a ‘pension’ can mean a multitude of different things and the way your savings are organised can make a big difference to whether or not you are able to do what you planned in your later life – and also how your money is treated once you die.

George Osborne established a place for himself in the canon of personal savings policy through the introduction of ‘freedom and choice’ in pensions in 2015. This changed the rules dramatically, and gave pension income a level of public interest it had never seen before. Effectively the policymakers changed the rules, left the ring and took the ropes with them as we entered a new era of personal responsibility in retirement.

But what difference has that made? Have people changed their plans as a result, and what does 'normal' for retirement income look like now?

Old Mutual Wealth has just released. with YouGov, its third detailed survey of how people in the UK are planning their income needs in retirement. What is becoming clear is that 'normal' looks nothing like it did before. People have adjusted and are operating according to a new normal.

In the new normal, people are reliant on multiple sources of income in retirement, including actively using their home, as more people anticipate downsizing to provide some income. 24 per cent of future retirees have said they would consider releasing value from their home in one way or another.

In the new normal, working beyond your state pension age is no longer seen as drudgery. With increasing longevity, the appeal of keeping busy with work has grown. Almost one-third of future retirees are expecting work to provide some of their income in retirement, with just under half suggesting one of the reasons for doing so would be to maintain social interaction.

The new normal means less binary decision-making. Each choice an individual makes along the way becomes critical, and the answers themselves are less obvious. How do you best invest your savings? Where is the best place for a rainy day fund? How do you want to take income in the future and what happens to your assets when you die?

 An abundance of choices to provide answers to the above questions is good, but too much choice can paralyse decision-making. The new normal requires a plan earlier in life.

All the while, policymakers have continued to give people plenty of things to think about. In the past 12 months alone, the previous chancellor deliberated over whether – and how – to cut pension tax relief for higher earners. The ‘pensions-ISA’ system was mooted as the culmination of a project to hand savers complete control over their retirement savings, while also providing a welcome boost to Treasury coffers in the short term.

During her time as pensions minister, Baroness Altmann voiced her support for the current system of taxing pension income, rather than contributions, indicating a split between the DWP and HM Treasury on the matter. Baroness Altmann’s replacement at the DWP is Richard Harrington. It remains to be seen how much influence he will have and on what side of the camp he sits regarding taxing pensions.

Meanwhile, Philip Hammond has entered the Treasury while our new Prime Minister calls for greater unity. Following a tumultuous time for pensions, a change in tone towards greater unity and cross-department collaboration would be very welcome.

In order for everyone to acclimatise properly to the new normal, the new chancellor should commit to a return to a longer-term, strategic approach to pensions policymaking, enabling all parties, from regulators and providers to customers, to make decisions with confidence that the landscape will not continue to shift as fundamentally as it has in recent times.

Steven Levin is CEO of investment platforms at Old Mutual Wealth.

To view all of Old Mutual Wealth’s retirement reports, visit: www.oldmutualwealth.co.uk/ products-and-investments/ pensions/pensions2015/