Miliband's sheet is still blank on public service reform

The Labour leader appears determined to avoid the challenge of fixing state services without spending more money on them.

Even people who are obsessed with politics often find their eyes glazing over when the conversation turns to the detail of public sector reform. That is understandable given the technical complexity of some of the systems under discussion and the tendency for reformers to speak in think tank patois. But I’m sure Ed Miliband has a firm grasp of that rarefied idiom, so he must have other reasons for avoiding the subject.

And avoid it he does. I have seen for myself the glazing-over of the opposition leader’s eyes and averting of the gaze into the middle distance when he is asked how Labour would meet the challenge of fixing state services without spending more money on them. Shadow cabinet ministers who want to have that conversation find it hard to get access to Miliband. Frontbenchers who have tried to push reform onto the agenda were notably overlooked or sidelined in October’s shadow cabinet reshuffle. Labour MPs understood the message clearly enough – the Labour leader will say something about public services when he is good and ready; there are no rewards for trying to accelerate the timetable.

There are a various interpretations of this caution. Miliband’s aides are quick to point out that public sector reform is not a paramount concern among voters. It is a reasonable point. Labour should concentrate on winning support where it is available, not where policy wonks wish it would be. The counter-argument, with which I have now bored even myself through repetition in blogs, columns and private conversations, is that having an imaginative story to tell about public service reform is the way Labour can transmit a message about getting more for less with taxpayers’ money. That is a route to fiscal credibility, which is a paramount concern among many voters. Presenting creative solutions to the challenge of governing in austerity is likely to be a whole lot more persuasive than paper pledges to keep purse-strings tight, which the public discounts as just the kind of thing politicians feel they have to say.

There are senior Labour figures who take that view, including Miliband advisors, but they seem to have difficulty getting the boss to focus on the matter for long. There are various explanations for this is the case.

One view I have heard from the shadow cabinet is that Miliband doesn’t have any experience of working in or shadowing a big spending department. His time in government was spent as a Treasury advisor, a Cabinet Office minister and, finally, as Energy Secretary. In that latter role, he was often focused on climate change, working with people who believed in a cause in which he also believed. He hasn’t experienced first hand the frustration of the minister who has a plan for improving services – or tightening their budgets – and finds that the sector itself and that civil service are blocking change. He has never, for example, been forced to take sides when the interests of patients and doctors collide, or teaching unions and parents.

A parallel factor is Miliband’s reluctance to get into policy debates that risk opening up old factional wounds from the Blair-Brown era. The Labour leader’s allies are fond of dismissing calls for a clear public sector reform agenda as part of "an old 90s frame" – which is code for saying that it is something Blairite ultras obsess about while everyone else on the left has moved on. That is partly fair. The idea that services can be improved by outsourcing key functions to the likes of Serco, Capita and G4S has been pretty well discredited. Likewise, there is mixed evidence at best when it comes to the belief that public sector efficiency and quality are raised when service users (parents and patients) choose between competing providers (schools and hospitals) in quasi-markets.

But there aren’t that many people on the Labour side who seriously advocate an unalloyed choice-and-markets approach to reform. The conversation has, as Miliband’s friends declare, moved on. The problem is that any attempt to question the traditional model of state delivery or to criticise existing services risks being interpreted in some Labour circles as stealthy Blairism, which for its fiercest critics is hardly better than Conservatism.

The fear among some Labour MPs is that they can’t even discuss ways to make the NHS more responsive to patients’ needs or ways to make sure standards in schools keep rising without being accused of back-door privatisation and pandering to a Tory agenda.

The would-be reformers are currently pinning some hope on Jon Cruddas, who is leading Labour’s policy review for Miliband. No-one in the Labour party is ever going to accuse Cruddas of being a slavish devotee of the Cult of Tony, which gives him rare authority in the leader’s office to raise the matter of state reform. Indeed, the one time I have heard Miliband acknowledge the need for the party to have a public sector reform message he referred to the need to match people’s resentment of greedy, self-serving corporations with a need to address their frustrations at the hands of an "unresponsive state". That’s a Cruddas phrase.

The essential division now seems to be between those, like Cruddas, who think the party needs a radical shift in the way Labour talks about the state and between those – chiefly, but not exclusively, allies of Ed Balls – who prefer to contain the debate in the more conventional parameters of how much is being spent in Whitehall and on what.

This isn’t an argument about fiscal responsibility – the shadow Chancellor is more alert than anyone to the need to show that Labour can be prudent. At issue is a conceptual point about whether the future of public services lies in devolution of power and control over budgets to local level and even, ultimately, to service users themselves. The key Cruddasite ambition (outlined in this lecture from last December) is between services that work at the level of sustaining relationships between provider and citizen and those that deal in impersonal transactions.

The reformers think Labour has an opportunity to launch a consumer-led revolution in public services, thereby renewing the social contract that serves as the left’s mandate to spend public money. The sceptics think that is all abstract wonk-speak that would amount, in practice, to chaos and loss of central control. Time spent at the Treasury teaches politicians to fear devolution of budgeting authority to anyone for fear that they mess it all up and leave the Chancellor to pick up the pieces.

So where does Miliband sit in all of this? As with so many issues, no-one seems entirely sure where his instincts lie. It is clear enough that he doesn’t want to make this stuff the centre-piece of his offer in a general election. The question is whether he will support a reformist agenda enough for it to make its way into a Labour manifesto. One close observer of the opposition leader’s office says that when Miliband has one-on-one meetings with Cruddas he gets very enthusiastic about his ideas and the policy review – that the two men find much in common. But then the fire in Miliband’s eyes is quickly extinguished on contact with the cold reality of managing the different views around the shadow cabinet table and factional prejudices in the party.

It isn’t even clear what the process is for debating ideas that come out of the policy review or turning them into a manifesto. There is a labyrinth of committees and sub-committees but none of these seems to have sufficient authority to say what will make it onto the party’s agenda for government. The shadow cabinet doesn’t make policy. Shadow cabinet ministers don’t always know whom to lobby in Miliband’s office to get their views heard. Reserves of trust between various senior figures in the leader’s office, the shadow treasury team, the election strategy team and the shadow cabinet all seem perilously low. There were hopes in the parliamentary party that, after the reshuffle, the Labour leader would feel more confident in his position – having stamped his personal authority on the front bench – and would allow a culture of open debate to flourish. At least where imagining the future of public services is concerned, there isn't much evidence of that happening.

Ed Miliband speaks at the Labour conference in Brighton earlier this year. Photograph: Getty Images.

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

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Why isn't Labour putting forward Corbynite candidates?

Despite his successes as a candidate, the organisational victories have gone the way of Corbyn's opponents. 

The contest changes, but the result remains the same: Jeremy Corbyn’s preferred candidate defeated in a parliamentary selection. Afzhal Khan is Labour’s candidate in the Manchester Gorton by-election and the overwhelming favourite to be the seat’s next MP.

Although Khan, an MEP, was one of  the minority of Labour’s European MPs to dissent from a letter from the European parliamentary Labour party calling for Jeremy Corbyn to go in the summer of 2016, he backed Andy Burnham and Tom Watson in 2015, and it is widely believed, fairly or unfairly, that Khan had, as one local activist put it, “the brains to know which way the wind was blowing” rather than being a pukka Corbynite.

For the leader’s office, it was a double defeat;  their preferred candidate, Sam Wheeler, was kept off the longlist, when the party’s Corbynsceptics allied with the party’s BAME leadership to draw up an all ethnic minority shortlist, and Yasmine Dar, their back-up option, was narrowly defeated by Khan among members in Manchester Gorton.

But even when the leadership has got its preferred candidate to the contest, they have been defeated. That even happened in Copeland, where the shortlist was drawn up by Corbynites and designed to advantage Rachel Holliday, the leader’s office preferred candidate.

Why does the Labour left keep losing? Supporters combination of bad luck and bad decisions for the defeat.

In Oldham West, where Michael Meacher, a committed supporter of Jeremy Corbyn’s, was succeeded by Jim McMahon, who voted for Liz Kendall, McMahon was seen to be so far ahead that they had no credible chance of stopping him. Rosena Allin-Khan was a near-perfect candidate to hold the seat of Tooting: a doctor at the local hospital, the seat’s largest employer, with links to both the Polish and Pakistani communities that make up the seat’s biggest minority blocs.  Gillian Troughton, who won the Copeland selection, is a respected local councillor.

But the leadership has also made bad decisions, some claim.  The failure to get a candidate in Manchester Gorton was particularly egregious, as one trade unionist puts it: “We all knew that Gerald was not going to make it [until 2020], they had a local boy with good connections to the trade unions, that contest should have been theirs for the taking”. Instead, they lost control of the selection panel because Jeremy Corbyn missed an NEC meeting – the NEC is hung at present as the Corbynsceptics sacrificed their majority of one to retain the chair – and with it their best chance of taking the seat.

Others close to the leadership point out that for the first year of Corbyn’s leadership, the leader’s office was more preoccupied with the struggle for survival than it was with getting more of its people in. Decisions in by-elections were taken on the hop and often in a way that led to problems later down the line. It made sense to keep Mo Azam, from the party’s left, off the shortlist in Oldham West when Labour MPs were worried for their own seats and about the Ukip effect if Labour selected a minority candidate. But that enraged the party’s minority politicians and led directly to the all-ethnic-minority shortlist in Manchester Gorton.

They also point out that the party's councillor base, from where many candidates are drawn, is still largely Corbynsceptic, though they hope that this will change in the next round of local government selections. (Councillors must go through a reselection process at every election.)

But the biggest shift has very little to do with the Labour leadership. The big victories for the Labour left in internal battles under Ed Miliband were the result of Unite and the GMB working together. Now they are, for various reasons, at odds and the GMB has proven significantly better at working shortlists and campaigning for its members to become MPs.  That helps Corbynsceptics. “The reason why so many of the unions supported Jeremy the first time,” one senior Corbynite argues, “Is they wanted to move the Labour party a little bit to the left. They didn’t want a socialist transformation of the Labour party. And actually if you look at the people getting selected they are not Corbynites, but they are not Blairites either, and that’s what the unions wanted.”

Regardless of why, it means that, two years into Corbyn’s leadership, the Labour left finds itself smaller in parliament than it was at the beginning.  

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.