Labour has a public sector reform agenda. Or does it?

Ed Miliband has said the state needs to change. He also needs to say how.

A familiar charge against Labour is that the party is in denial about the need to make cuts to public services. This isn’t quite true. The economic argument Ed Miliband and Ed Balls have advanced certainly attacks the government for premature, ill-targeted and aggressive cuts that stifle growth. (It is safe to say the “too far, too fast” line has had an adequate public airing.) There is also constituency on the left that sees budget austerity as wholly unnecessary – a pretext for indulging an old Conservative appetite for shrinking the state. But the official party line is to accept that spending under a Labour government would be tight. Miliband has been explicit in saying a return to pre-crisis levels of investment in public services is not an option. Balls has promised a “zero-based” spending review, which, in theory at least, puts everything on the table for possible cuts.

The problem is that not enough voters think Labour’s heart is in fiscal discipline, partly because there is very little indication of what the opposition sees the state doing now that it imagines not being done at taxpayers’ expense in the future or, failing that, how it might be done differently so money can be saved. Meanwhile, there are plenty of coalition measures being opposed. If there is a credibility gap it won’t be closed by more theoretical commitments to control spending but in the generation of imaginative ideas for getting more for less. No one questions Labour's love of public services. The doubt is whether it has ideas for expressing that love in ways other than central government spending.

Slowly, a reform agenda is emerging. I’ve blogged before about the shadow health team’s plans for “whole person care” and the merger of NHS and social care budgets. This is perhaps the furthest advanced policy area where Labour front benchers are talking openly about long-term financial constraints. They don’t have much choice. Demographic trends mean that health budgets will be squeezed regardless of the timetable a Chancellor adopts for reining in the deficit.

Liz Kendall, shadow social care minister, gave a speech yesterday setting out in some depth Labour’s approach to the question of how society should care for an ageing population and, crucially, how it might better afford to do so. It is worth a read not just because it contains actual policy but because it sets the issue in a wider context of how state services need to evolve more generally if they are to retain the confidence of people who rely on them. Kendall’s argument is that ultimately users of services will expect to have more control and will expect state provision to be more flexible and responsive to their needs. Those demands can be met, in part, by devolution of budgets but they also require a new way of thinking about what state provision looks and feels like. In a revealing pasage in the speech, Kendall notes:

Making the big changes people want, and our public finances demand, will require fundamental reforms to public services and the role of the state. The old top-down approach - where the state does things to or for people - won’t work. This isn’t just because the kinds of increases in public spending that Labour secured when we were last in Government simply won’t be possible for the foreseeable future. It’s because public services must change if they’re going to retain support in the long run. Every week in my constituency surgery people tell me how frustrated and even angry they are about one public service or another: how they’ve been badly treated, fobbed off and passed between different departments, as if their views and concerns don’t matter. A One Nation approach to public services understands that an over bureaucratic state, as well as unrestrained markets, prevents people from leading the lives they want to live.

A similar argument was made by Ivan Lewis, shadow International Development Secretary, writing about the need to reform the state in the New Statesman last week. He wrote that:

By the end of our period in government, Labour’s failure to talk about family and community left the impression that we saw Britain’s future only through the prism of state and market. One Nation Labour believes our future success depends on our capacity to harness the best of an active state, aspirational individuals, strong families and community networks supported by a vibrant private sector.


New private sector provision would be supported where state provision has repeatedly failed or is unable to meet needs and where partnerships between public and private can improve outcomes. But this has to be within a framework of public accountability and high ethical standards. It is one tool in the locker, not the answer in all times and places.

In the NHS and education, the Tories have focused on giving power to the providers of services. One Nation Labour will give more influence and control to patients and parents. In my view choice is neither a panacea nor a realistic option in many circumstances. But it is crucial to give people a personalised - not a “conveyor belt” - service, with greater control for individuals and families over decisions about their lives together with a greater stake in collective community provision.

This may all sound a bit wonkish and abstract but in the context of Labour’s gradual advance towards a position on public sector reform it is significant. (Both interventions would have to be approved by the leader’s office so can be said to have Ed Miliband’s permission – even, perhaps, his blessing.) The problem and the reason new ideas sometimes come across as encrypted or camouflaged in jargon is that not everyone in the party is persuaded that this is the kind of language Labour should be using, or even the kind of conversation the party should be having.

There are, crudely speaking, two kinds of obstruction. The first is among those on the left, chiefly in the trade union movement, who see any discussion of private sector participation, choice or markets as an attack on the integrity of a well-resourced public sector and, by extension, a resurgence of “Blairism.” The increasing deployment of that word as a term of abuse has a suffocating effect, stifling any impulse to consider ways to innovate and demand efficiency in the way government works. The second obstacle is more subtle. It is the concern that advertising Labour’s commitment to reform public services with a more-for-less agenda confuses the message of opposition to what the coalition is doing. In essence, this is the enduring argument that Labour’s commitment to public services is a “dividing line” from the Tories who can be presented as wanting to slash, burn and privatise everything the public holds dear. According to this view, conceding that there is a long-term funding challenge, accepting that services were failing to live up to expectations even under the last government and naming ways to improve them risks abetting the coalition when it claims that its own policies represent a clearing up of Labour’s mess.

The trouble with that approach is that is presumes voters haven’t noticed that the public sector needs modernisation and that they are entirely happy with the kind of service that is delivered by monolithic institutions administered centrally and funded top-down by the Treasury. It also presumes that when voters despair of David Cameron and George Osborne they will rebound naturally into Labour’s arms and cease to believe that a cause of their current pain is profligate spending under the old regime. Three years into this parliament, with two years remaining before a general election, there isn’t much evidence that is the case. Labour needs to be in the business of reassuring people that it respects the fact that the money they spend comes from somewhere and that every sinew is being strained to get the best value from it in terms of quality and efficiency.

Ed Miliband appears gradually to be coming round to this view. When I spoke to him a few weeks ago, he spoke about the challenge of addressing public concerns about an “unresponsive state”. He cited the influence of Jon Cruddas, who leads Labour’s policy review and who has written and spoken in the past about the weakness of a position that relies on defending a faceless bureaucratic state model. But Miliband is happiest talking about the way poeple have lost faith in parts of the private sector – in the banks, privatised utilities, energy and train companies - who they feel are ripping them off. He is at ease urging a more humane and moral brand of capitalism. While he recognises that there is also a need to restore public trust in organs of the state, I sense he is far less enthusiastic about that side of the equation and so less consistently engaged in what might be involved. That will have to change. There is only so much that can be achieved by allowing out-riding shadow ministers to float public sector reform ideas in occasional op eds and speeches. At some point, if this is to become a serious plank of party policy, the leader has to put the full authority of his office behind it. If Labour really believes in reforming the state, if it thinks that innovation in the public sector is one route to a better society and a balanced budget, Ed Miliband has to start saying so.

Ed Miliband and Ed Balls at the Labour conference in Manchester last year. Photograph: Getty Images.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

Green Party
Show Hide image

Caroline Lucas and Jonathan Bartley: "The Greens can win over Ukip voters too"

The party co-leaders condemned Labour's "witch hunt" of Green-supporting members. 

“You only have to cast your eyes along those green benches to think this place doesn't really represent modern Britain,” said Caroline Lucas, the UK’s only Green MP, of the House of Commons. “There are lots of things you could do about it, and one is say: ‘Why not have job share MPs?’”

Politics is full of partnerships and rivalries, but not job shares. When Lucas and Jonathan Bartley were elected co-leaders of the Green party in September, they made history. 

“I don't think any week's been typical so far,” said Bartley, when I met the co-leaders in Westminster’s Portcullis House. During the debate on the Hinkley power plant, he said, Lucas was in her constituency: “I was in Westminster, so I could pop over to do the interviews.”

Other times, it’s Bartley who travels: “I’ve been over to Calais already, and I was up in Morecambe and Lancaster. It means we’re not left without a leader.”

The two Green leaders have had varied careers. Lucas has become a familiar face in Parliament since 2010, whereas Bartley has spent most of his career in political backrooms and wonkish circles (he co-founded the think tank Ekklesia). In the six weeks since being elected, though, they seem to have mastered the knack of backing each other up. After Lucas, who represents Brighton Pavilion, made her point about the green benches, Bartley chimed in. “My son is a wheelchair user. He is now 14," he said. "I just spent a month with him, because he had to have a major operation and he was in the recovery period. The job share allows that opportunity.”

It’s hard enough for Labour’s shadow cabinet to stay on message. So how will the Greens do it? “We basically said that although we've got two leaders, we've got one set of policies,” said Lucas. She smiled. “Whereas Labour kind of has the opposite.”

The ranks of the Greens, like Labour, have swelled since the referendum. Many are the usual suspects - Remainers still distressed about Brexit. But Lucas and Bartley believe they can tap into some of the discontent driving the Ukip vote in northern England.

“In Morecambe, I was chatting to someone who was deciding whether to vote Ukip or Green,” said Bartley. “He was really distrustful of the big political parties, and he wanted to send a clear message.”

Bartley points to an Ashcroft poll showing roughly half of Leave voters believed capitalism was a force for ill (a larger proportion nevertheless was deeply suspicious of the green movement). Nevertheless, the idea of voters moving from a party defined by border control to one that is against open borders “for now” seems counterintuitive. 

“This issue in the local election wasn’t about migration,” Bartley said. “This voter was talking about power and control, and he recognised the Greens could give him that.

“He was remarking it was the first time anyone had knocked on his door.”

According to a 2015 study by the LSE researcher James Dennison, Greens and Kippers stand out almost equally for their mistrust in politicians, and their dissatisfaction with British democracy. 

Lucas believes Ukip voters want to give “the system” a “bloody big kick” and “people who vote Green are sometimes doing that too”. 

She said: “We’re standing up against the system in a very different way from Ukip, but to that extent there is a commonality.”

The Greens say what they believe, she added: “We’re not going to limit our ambitions to the social liberal.”

A more reliable source of support may be the young. A May 2015 YouGov poll found 7 per cent of voters aged 18 to 29 intended to vote Green, compared to just 2 per cent of those aged 60+. 

Bartley is cautious about inflaming a generational divide, but Lucas acknowledges that young people feel “massively let down”.

She said: “They are certainly let down by our housing market, they are let down by universities. 

“The Greens are still against tuition fees - we want a small tax for the biggest businesses to fund education because for us education is a public good, not a private commodity.”

Of course, it’s all very well telling young people what they want to hear, but in the meantime the Tory government is moving towards a hard Brexit and scrapping maintenance grants. Lucas and Bartley are some of the biggest cheerleaders for a progressive alliance, and Lucas co-authored a book with rising Labour star Lisa Nandy on the subject. On the book tour, she was “amazed” by how many people turned up “on wet Friday evenings” to hear about “how we choose a less tribal politics”. 

Nevertheless, the idea is still controversial, not least among many in Nandy's own party. The recent leadership contest saw a spate of members ejected for publicly supporting the Greens, among other parties. 

“It was like a witch hunt,” said Lucas. “Some of those tweets were from a year or two ago. They might have retweeted something that happened to be from me saying ‘come join us in opposing fracking’, which is now a Labour policy. To kick someone out for that is deeply shocking.”

By contrast, the Greens have recently launched a friends scheme for supporters, including those who are already a member of another party. “The idea that one party is going to know it all is nonsense,” said Bartley. “That isn’t reality.”

Lucas and Bartley believe the biggest potential for a progressive alliance is at constituency level, where local people feel empowered, not disenfranchised, by brokering deals. They recall the 1997 election, when voters rallied around the independent candidate Martin Bell to trounce the supposedly safe Tory MP Neil Hamilton. Citing a recent letter co-signed by the Greens, the Scottish National Party and Plaid Cymru condemning Tory rhetoric on immigrants, Bartley points out that smaller parties are already finding ways to magnify their voice. The fact the party backed down on listing foreign workers was, he argued, “a significant win”. 

As for true electoral reform, in 2011, a referendum on changing Britain's rigid first past the post system failed miserably. But the dismal polls for the Labour party, could, Lucas thinks, open up a fresh debate.

“More and more people in the Labour party recognise now that no matter who their leader is, their chance of getting an outright majority at the next election is actually vanishingly small,” she said. “It’s in their interests to support electoral reform. That's the game changer.” 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.