We lost. But the fight continues

Labour cannot let the coalition ruin the NHS.

It was a tense two days: attention was focused, argument was heeded. Heads nodded in agreement. There was no barracking. We're a polite lot in the Lords. The second reading of the Health and Social Care Bill was introduced by the Health Minister the Earl Howe. He was universally praised for the thoughtful and exact way he introduced this legislation. Willowy of stature with a slick of grey hair his quiet voice commanded the Chamber. He could, as Labour Baroness Donaghy remarked have "made this Titanic of a Bill sound like one of Abromovitch's yachts". We're a polite lot in the Lords but we make our differences clear.

There were 100 speakers over a day and a half, with 41 of them women, and up to six bishops sitting together, their white sleeves billowing like foam on the bishops' benches. The Archbishop of York made a powerful speech in favour of Lord Owen's amendment that proposed the setting up of a new Select Committee to scrutinise contentious issues around the duties of the legal accountability of the Secretary of State, such a Committee to run in parellel as the House of Lords itself debated remaining clauses. But first there was Labour Peer Lord Rea's amendment that "this House declines to give the bill a second reading...." Labour peers voted for both and both amendments would be lost, by 134 and 68 respectively.

Many cited their personal background: Baroness Kennedy spoke of her surgeon husband's family, a dynasty of doctors who wanted no part of anything other than a publicly funded and provided National Health Service: Lord Alderdice spoke of his extensive medical family too: sadly they were on different sides. Everyone spoke of being inundated with letters, emails and briefings. Passions ran high: some of us feared the NHS was being handed over to privatisation. Baroness Murphy called this "twaddle". Baroness Bottomley called it "romantic poppycock" and gave a warm welcome to the bill. She also managed to praise the merits of Tesco, a connection that didn't seem appropriate. Lord Mawhinny condemned what he believed was an unprecedented.level of scaremongering. Those of us who are genuinely scared spoke of the risk of the free market, of going the way of America which spends 2.4 times more on health per person than Britain and yet has life expectancy levels lower than here.

By the end of day one the numbers in the Chamber had thinned. Former trade unionist Bill Morris's turn to speak came at around midnight. But next morning the Chamber steadily filled up. The ailing Philip Gould turned up to support Labour; the recently widowed Lord Saatchi arrived to support the coalition. Some wondered whether Mrs Thatcher might come among us.

At the last minute there was a sudden flurry of discussion about whether Lord Owen's proposals could be brought in by a certain date. Last minute expectations and fears coalesced around this minor spat. And then it was time to line up in the lobbies.

And so we lost. Being fewer in number, Labour could only have carried the day if enough Cross benchers and Lib Dems came across and voted with us. And not enough did. So the Bill now goes to its committee stage, a time when a cascade of amendments will be tabled, each one argued to death and perhaps significant changes brought to this unwieldy and unwelcome bill. We face hard days ahead, but every inch gained will be worth it. We all know that the British public want the NHS to survive as they know it, only better. Labour were on the way to doing that. We can't let the coalition ruin it.

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What type of Brexit did we vote for? 150,000 Conservative members will decide

As Michael Gove launches his leadership bid, what Leave looks like will be decided by Conservative activists.

Why did 17 million people vote to the leave the European Union, and what did they want? That’s the question that will shape the direction of British politics and economics for the next half-century, perhaps longer.

Vote Leave triumphed in part because they fought a campaign that combined ruthless precision about what the European Union would do – the illusory £350m a week that could be clawed back with a Brexit vote, the imagined 75 million Turks who would rock up to Britain in the days after a Remain vote – with calculated ambiguity about what exit would look like.

Now that ambiguity will be clarified – by just 150,000 people.

 That’s part of why the initial Brexit losses on the stock market have been clawed back – there is still some expectation that we may end up with a more diluted version of a Leave vote than the version offered by Vote Leave. Within the Treasury, the expectation is that the initial “Brexit shock” has been pushed back until the last quarter of the year, when the election of a new Conservative leader will give markets an idea of what to expect.  

Michael Gove, who kicked off his surprise bid today, is running as the “full-fat” version offered by Vote Leave: exit from not just the European Union but from the single market, a cash bounty for Britain’s public services, more investment in science and education. Make Britain great again!

Although my reading of the Conservative parliamentary party is that Gove’s chances of getting to the top two are receding, with Andrea Leadsom the likely beneficiary. She, too, will offer something close to the unadulterated version of exit that Gove is running on. That is the version that is making officials in Whitehall and the Bank of England most nervous, as they expect it means exit on World Trade Organisation terms, followed by lengthy and severe recession.

Elsewhere, both Stephen Crabb and Theresa May, who supported a Remain vote, have kicked off their campaigns with a promise that “Brexit means Brexit” in the words of May, while Crabb has conceded that, in his view, the Leave vote means that Britain will have to take more control of its borders as part of any exit deal. May has made retaining Britain’s single market access a priority, Crabb has not.

On the Labour side, John McDonnell has set out his red lines in a Brexit negotiation, and again remaining in the single market is a red line, alongside access to the European Investment Bank, and the maintenance of “social Europe”. But he, too, has stated that Brexit means the “end of free movement”.

My reading – and indeed the reading within McDonnell’s circle – is that it is the loyalists who are likely to emerge victorious in Labour’s power struggle, although it could yet be under a different leader. (Serious figures in that camp are thinking about whether Clive Lewis might be the solution to the party’s woes.) Even if they don’t, the rebels’ alternate is likely either to be drawn from the party’s Brownite tendency or to have that faction acting as its guarantors, making an end to free movement a near-certainty on the Labour side.

Why does that matter? Well, the emerging consensus on Whitehall is that, provided you were willing to sacrifice the bulk of Britain’s financial services to Frankfurt and Paris, there is a deal to be struck in which Britain remains subject to only three of the four freedoms – free movement of goods, services, capital and people – but retains access to the single market. 

That means that what Brexit actually looks like remains a matter of conjecture, a subject of considerable consternation for British officials. For staff at the Bank of England,  who have to make a judgement call in their August inflation report as to what the impact of an out vote will be. The Office of Budget Responsibility expects that it will be heavily led by the Bank. Britain's short-term economic future will be driven not by elected politicians but by polls of the Conservative membership. A tense few months await. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.