Labour's pluralist challenge

Labour is necessary, but no longer sufficient, for progressive advance.

I was 16 when Margaret Thatcher fell from power. One of the ways in which she changed the left was to half-convert the Labour Party to pluralism. Labour asked itself seriously for the first time whether there was anything much wrong with the British state that wouldn't be solved by Labour being in charge of it.

Anthony Barnett's Charter 88 created important civic pressure on Labour and Liberal Democrat politicians to create an extensive reform agenda. New Labour's first term did more to reform the British state than any government since 1911. In power, older instincts re-emerged, yet the effects of devolution and Freedom of Information will endure.

Yet Barnett's latest anti-Labour New Statesman polemic barks up the wrong tree. It would make a hung parliament less, not more likely. Voting against the big two is not the same thing as promoting a hung parliament. Voters who want to stop any party getting 326 seats should back the strongest anti-Tory candidate in any seat the Conservatives could win (until they think a Labour majority more likely than a Tory one).

Write Labour off as a lost cause and there will be no plausible, pluralist governing project for Britain any time in the next decade, either. The Greens seek a parliamentary foothold, the Lib Dems to hold 120 seats after two elections. Then what?

Any new settlement will require alliances, which are overwhelmingly more likely on the centre left. (By all means, try to make David Cameron's centrist rhetoric at least constrain his party's Thatcherite ambitions; the realistic goal may be the conservative one, to protect past advances from repeal.)

The great progressive advances in British politics all arose from various forms of Lab-Lib co-operation. That was true of Labour's 1906 entry to parliament; breaking the Lords veto in the hung parliament of 1911; Attlee enshrining the Keynes-Beveridge settlement; the social legislation of the 1960s; and early New Labour's constitutional legacy.

 

A fair share of freedom

Outside these sporadic pluralist flurries, the right has mostly dominated. David Marquand's central thesis in The Progressive Dilemma was that Labour was necessary, but no longer sufficient, for progressive advance. If the 1997 and 2001 landslides seemed to disprove this as a matter of electoral arithmetic, the theory looks stronger than ever if we seek a transformative politics.

Pluralism should recognise differences. Different parties on the left of centre have different traditions, identities and instincts. They have much to argue over -- yet these arguments sharpen central challenges.

How can markets be sustainable and fair? We need to restore Labour's instinct for civil liberties, without lapsing into an allergy to state action in breaking down class-based disadvantage. The central political challenge is how to sustain majority public coalitions to be able to narrow inequalities, address climate change and sustain Britain's place in Europe.

Perhaps the defining argument between left and right is whether equality and liberty can be allied, or are always in fundamental tension. The quest that has animated thinkers from Tawney to Amartya Sen -- how to secure the fairest possible distribution of substantive freedom -- should provide a foundation stone for a plural left.

None of this can be achieved by one party alone, nor could any party easily wish the others away. But we must create a more pluralist Labour Party, able to play a leading part, for it to have much chance of happening at all.

Sunder Katwala is general secretary of the Fabian Society

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Sunder Katwala is director of British Future and former general secretary of the Fabian Society.

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BHS is Theresa May’s big chance to reform capitalism – she’d better take it

Almost everyone is disgusted by the tale of BHS. 

Back in 2013, Theresa May gave a speech that might yet prove significant. In it, she declared: “Believing in free markets doesn’t mean we believe that anything goes.”

Capitalism wasn’t perfect, she continued: 

“Where it’s manifestly failing, where it’s losing public support, where it’s not helping to provide opportunity for all, we have to reform it.”

Three years on and just days into her premiership, May has the chance to be a reformist, thanks to one hell of an example of failing capitalism – BHS. 

The report from the Work and Pensions select committee was damning. Philip Green, the business tycoon, bought BHS and took more out than he put in. In a difficult environment, and without new investment, it began to bleed money. Green’s prize became a liability, and by 2014 he was desperate to get rid of it. He found a willing buyer, Paul Sutton, but the buyer had previously been convicted of fraud. So he sold it to Sutton’s former driver instead, for a quid. Yes, you read that right. He sold it to a crook’s driver for a quid.

This might all sound like a ludicrous but entertaining deal, if it wasn’t for the thousands of hapless BHS workers involved. One year later, the business collapsed, along with their job prospects. Not only that, but Green’s lack of attention to the pension fund meant their dreams of a comfortable retirement were now in jeopardy. 

The report called BHS “the unacceptable face of capitalism”. It concluded: 

"The truth is that a large proportion of those who have got rich or richer off the back of BHS are to blame. Sir Philip Green, Dominic Chappell and their respective directors, advisers and hangers-on are all culpable. 

“The tragedy is that those who have lost out are the ordinary employees and pensioners.”

May appears to agree. Her spokeswoman told journalists the PM would “look carefully” at policies to tackle “corporate irresponsibility”. 

She should take the opportunity.

Attempts to reshape capitalism are almost always blunted in practice. Corporations can make threats of their own. Think of Google’s sweetheart tax deals, banks’ excessive pay. Each time politicians tried to clamp down, there were threats of moving overseas. If the economy weakens in response to Brexit, the power to call the shots should tip more towards these companies. 

But this time, there will be few defenders of the BHS approach.

Firstly, the report's revelations about corporate governance damage many well-known brands, which are tarnished by association. Financial services firms will be just as keen as the public to avoid another BHS. Simon Walker, director general of the Institute of Directors, said that the circumstances of the collapse of BHS were “a blight on the reputation of British business”.

Secondly, the pensions issue will not go away. Neglected by Green until it was too late, the £571m hole in the BHS pension finances is extreme. But Tom McPhail from pensions firm Hargreaves Lansdown has warned there are thousands of other defined benefit schemes struggling with deficits. In the light of BHS, May has an opportunity to take an otherwise dusty issue – protections for workplace pensions - and place it top of the agenda. 

Thirdly, the BHS scandal is wreathed in the kind of opaque company structures loathed by voters on the left and right alike. The report found the Green family used private, offshore companies to direct the flow of money away from BHS, which made it in turn hard to investigate. The report stated: “These arrangements were designed to reduce tax bills. They have also had the effect of reducing levels of corporate transparency.”

BHS may have failed as a company, but its demise has succeeded in uniting the left and right. Trade unionists want more protection for workers; City boys are worried about their reputation; patriots mourn the death of a proud British company. May has a mandate to clean up capitalism - she should seize it.