Politically incorrect - John Kampfner reveals Brown's grand design

Brown, the great engineer and planner, will dish out the money - but he wants it to affect the way w

Gordon Brown is a social engineer. He is not content with just the nation's purse strings: he wants to change our behaviour and he wants to change our institutions.

He granted extra cash to schools, hospitals and government departments - as long as they reformed the way they operated. Now, as he announces his comprehensive spending review on 15 July, he is setting his sights beyond.

He announced the big numbers in the Budget in April, and set out the big priorities as education and health. But this Chancellor will not confine himself to dividing up the spoils for the next three financial years. He wants to affect the way we study, how we work, and where we live.

This year's buzz phrase is "opportunity and security" - in that order. Behind it lies mounting ministerial concern that the economic growth of the past decade has failed to benefit whole swathes of society, who feel they have been passed by.

In an intriguing but largely ignored speech at a seminar on 6 July, Ed Balls, the chief economic adviser to the Treasury, dwelt on the recent failures of the European centre left, and on the need for governments to "shape expectations". This government, he said, was the first in Britain to increase taxes not in order to deal with a particular crisis, but in order to pursue a sustained strategy to expand public services.

All governments, especially social democratic ones, he went on, had to establish four sets of credentials: economic credibility; reform of the bodies that receive money; a clearly articulated vision; and dividing lines against the opposition. The subtext is clear - the government must not just deliver, people must see that it is delivering quickly.

For Brown, "opportunity" vastly outweighs "security". This is where the tension lies between himself and his rival David Blunkett.

Blunkett has, as any Home Secretary would, argued for more money to combat rising crime and the crisis in asylum and immigration. Brown has agreed that he can have a little more (not much), but wants results in return: quicker processing times for asylum applications and appeals. He believes that "insecurity", as defined in the law-and-order and asylum debates, merely reflects broader problems of social exclusion and inequality, which have to be dealt with first. Tax credits and other fiscal measures for the worse-off are beginning to have an effect. But they're only part of the story.

Globalisation, in Brown's view, can't be stopped. It has brought and will continue to bring greater insecurity. People can't be protected from it, but they can be helped to deal with it. Therefore, if poor whites in urban areas feel that immigrants have jumped the queue for housing, the answer is to look at the housing shortage. Look also at the lack of educational opportunities that fuels resentment. Again, if country dwellers fear being swamped by detention centres for asylum-seekers, look at the wider sense of grievance in rural areas.

Brown has already indicated that there will be financial incentives for young people from middle- and lower-income families to stay in education after 16 - some will get as much as £40 a week in maintenance allowances (costing a total of £600m). But Brown, I am told, wants to go further. He wants to shake up the further education colleges, which thousands of those young people attend to learn the technical, computing and other vocational skills (usually below degree level) that are often in desperately short supply in Britain. Around £500m of extra money is on offer, but again, Brown wants reform.

He thinks many colleges are not up to scratch, and that local businesses could take on a management or oversight role. This is all about wedding education to the needs of enterprise - it's nothing to do with the idea that learning might be an end in itself.

Encouragement of enterprise also dictates Brown's approach to urban planning. The well-trailed extra £1bn to build new homes across swathes of the country, especially the south-east, is not only an old-fashioned supply-and-demand measure to bring prices down generally, but also a belated attempt to help public sector workers who are priced out of the market. An immobile population, Brown thinks, is a less productive, less enterprising population.

Agriculture, too, is in Brown's sights. Last January's report by Sir Donald Curry into the future of farming and food has been dusted off, and many of its recommendations have gone through the Brown "investment for reform" filter. Sir Donald recommended shifting agricultural subsidies away from straightforward production and into diversification, organic farming and conservation of the countryside.

Whenever Brown dips into his bag of money, you can be sure there will be strings attached. Who said central planning was dead?