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

Photo: Getty
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The campaign to keep Britain in Europe must be based on hope, not fear

Together we can show the world a generous, outward-facing Britain we can all be proud of.

Today the Liberal Democrats launched our national campaign to keep Britain in Europe. With the polls showing the outcome of this referendum is on a knife-edge, our party is determined to play a decisive role in this once in a generation fight. This will not be an easy campaign. But it is one we will relish as the UK's most outward-looking and internationalist party. Together in Europe the UK has delivered peace, created the world’s largest free trade area and given the British people the opportunity to live, work and travel freely across the continent. Now is the time to build on these achievements, not throw them all away.

Already we are hearing fear-mongering from both sides in this heated debate. On the one hand, Ukip and the feuding Leave campaigns have shamelessly seized on the events in Cologne at New Year to claim that British women will be at risk if the UK stays in Europe. On the other, David Cameron claims that the refugees he derides as a "bunch of migrants" in Calais will all descend on the other side of the Channel the minute Britain leaves the EU. The British public deserve better than this. Rather than constant mud-slinging and politicising of the world's biggest humanitarian crisis since the Second World War, we need a frank and honest debate about what is really at stake. Most importantly this should be a positive campaign, one that is fought on hope and not on fear. As we have a seen in Scotland, a referendum won through scare tactics alone risks winning the battle but losing the war.

The voice of business and civil society, from scientists and the police to environmental charities, have a crucial role to play in explaining how being in the EU benefits the British economy and enhances people's everyday lives. All those who believe in Britain's EU membership must not be afraid to speak out and make the positive case why being in Europe makes us more prosperous, stable and secure. Because at its heart this debate is not just about facts and figures, it is about what kind of country we want to be.

The Leave campaigns cannot agree what they believe in. Some want the UK to be an offshore, deregulated tax haven, others advocate a protectionist, mean-hearted country that shuts it doors to the world. As with so many populist movements, from Putin to Trump, they are defined not by what they are for but what they are against. Their failure to come up with a credible vision for our country's future is not patriotic, it is irresponsible.

This leaves the field open to put forward a united vision of Britain's place in Europe and the world. Liberal Democrats are clear what we believe in: an open, inclusive and tolerant nation that stands tall in the world and doesn't hide from it. We are not uncritical of the EU's institutions. Indeed as Liberals, we fiercely believe that power must be devolved to the lowest possible level, empowering communities and individuals wherever possible to make decisions for themselves. But we recognise that staying in Europe is the best way to find the solutions to the problems that don't stop at borders, rather than leaving them to our children and grandchildren. We believe Britain must put itself at the heart of our continent's future and shape a more effective and more accountable Europe, focused on responding to major global challenges we face.

Together in Europe we can build a strong and prosperous future, from pioneering research into life-saving new medicines to tackling climate change and fighting international crime. Together we can provide hope for the desperate and spread the peace we now take for granted to the rest of the world. And together we can show the world a generous, outward-facing Britain we can all be proud of. So if you agree then join the Liberal Democrat campaign today, to remain in together, and to stand up for the type of Britain you think we should be.