Getty
Show Hide image

Why doesn’t the government’s industrial strategy include those most affected – the workers?

An “Industrial Strategy Council” will include investors, entrepreneurs, economists, scientists… but not, as far as we can tell, ordinary workers.

The government’s much-delayed industrial strategy was finally launched last month. It’s short on detail, with large font and glossy pictures padding out a 255-page document with few new ideas.

But one of its headline announcements was that an “Industrial Strategy Council” will set the direction of the strategy and hold the government to account. Its members will be drawn from various walks of life, including investors, entrepreneurs, economists, scientists… but not, as far as we can tell, ordinary workers.

When our colleague Kevin Brennan, shadow minister for arts and heritage, queried this – asking whether trade unions will be represented – the response he received was worryingly evasive.

The government would only say that members will be chosen “on the basis of their expertise, experience and skills” and that they will be “finalised over the coming months.” They made no commitments on workers’ representation, only adding: “We will think carefully about how Trade Unions can best support our Industrial Strategy.”

This approach is profoundly wrong. No organisation can be truly “independent” if it is cobbled together by government according to opaque criteria and on an ad-hoc basis. And if the government omits unions from the Council, it is excluding the people who actually do the work from the key decisions on how our economy will be run over the coming decades.

We’ve seen what can happen when Tory governments ignore the needs of ordinary people in favour of the wealthy who write their cheques.

Soaring foodbank usage, levels of income equality higher than anywhere else in Europe, the longest wage stagnation in 150 years, the worst decade for productivity since Napoleon was defeated at Waterloo – these are all the result of policy decisions made without giving working people a say.

The government’s industrial strategy is already incredibly narrow, made up of re-announced policies and old spending commitments, showing once again that this is a government short on details and new ideas. Sheffield Hallam University estimated that it will only affect 1 per cent of the economy, primarily boosting areas in and around the so-called “Golden Triangle” of Oxford, Cambridge and London.

With our economy about to go through a major transition as we leave the EU, there are urgent decisions to be made. As the Trade Union Congress have said: “The voice of business needs to be matched with that of workers if the UK is to survive and thrive in the uncertain world that we face”.

Evidence shows that work processes designed by and centred on people are the most likely to succeed. Time and again, the difference between average businesses and those that are world-class lies in the extent to which they unlock the endless potential and creativity of employees.

Unions are a force for good and an agent for change. If we want to build a high-wage, high-productivity, high-quality culture, their voice must be heard.

It is for this reason we have written to Greg Clark asking him to guarantee a role for trade unions in the Industrial Strategy Council and to consult with trade unions prior to the planned launch of the Council in spring 2018.

The historic role of our party is to be the voice of the workers’ movement in Parliament, ensuring ordinary people – from posties to primary school teachers – have a say in the running of our country.

Our economy will work better if working people get a chance to shape an industrial strategy. Labour’s Industrial Strategy set out a radical programme of investment and genuine partnership between industry and government, to build an economy that truly benefits the many, not just a privileged few.

Chi Onwurah is the Labour MP for Newcastle upon Tyne Central and the shadow minister for industrial strategy. Jack Dromey is the Labour MP for Birmingham Erdington and shadow minister for labour. 

Getty
Show Hide image

Labour’s renationalisation plans look nothing like the 1970s

The Corbynistas are examining models such as Robin Hood Energy in Nottingham, Oldham credit union and John Lewis. 

A community energy company in Nottingham, a credit union in Oldham and, yes, Britain's most popular purveyor of wine coolers. No, this is not another diatribe about about consumer rip-offs. Quite the opposite – this esoteric range of innovative companies represent just a few of those which have come to the attention of the Labour leadership as they plot how to turn the abstract of one of their most popular ideas into a living, neo-liberal-shattering reality.

I am talking about nationalisation – or, more broadly, public ownership, which was the subject of a special conference this month staged by a Labour Party which has pledged to take back control of energy, water, rail and mail.

The form of nationalisation being talked about today at the top of the Labour Party looks very different to the model of state-owned and state-run services that existed in the 1970s, and the accompanying memories of delayed trains, leaves on the line and British rail fruitcake that was as hard as stone.

In John McDonnell and Jeremy Corbyn’s conference on "alternative models of ownership", the three firms mentioned were Robin Hood Energy in Nottingham, Oldham credit union and, of course, John Lewis. Each represents a different model of public ownership – as, of course, does the straightforward takeover of the East Coast rail line by the Labour government when National Express handed back the franchise in 2009.

Robin Hood is the first not-for-profit energy company set up a by a local authority in 70 years. It was created by Nottingham city council and counts Corbyn himself among its customers. It embodies the "municipal socialism" which innovative local politicians are delivering in an age of austerity and its tariffs delivers annual bills of £1,000 or slightly less for a typical household.

Credit unions share many of the values of community companies, even though they operate in a different manner, and are owned entirely by their customers, who are all members. The credit union model has been championed by Labour MPs for decades. 

Since the financial crisis, credit unions have worked with local authorities, and their supporters see them as ethical alternatives to the scourge of payday loans. The Oldham credit union, highlighted by McDonnell in a speech to councillors in 2016, offers loans from £50 upwards, no set-up costs and typically charges interest of around £75 on a £250 loan repaid over 18 months.

Credit unions have been transformed from what was once seen as a "poor man's bank" to serious and tech-savvy lenders where profits are still returned to customers as dividends.

Then there is John Lewis. The "never-knowingly undersold" department store is owned by its 84,000 staff, or "partners". The Tories have long cooed over its pledge to be a "successful business powered by its people and principles" while Labour approves of its policy of doling out bonuses to ordinary staff, rather than just those at the top. Last year John Lewis awarded a partnership bonus of £89.4m to its staff, which trade website Employee Benefits judged as worth more than three weeks' pay per person (although still less than previous top-ups).

To those of us on the left, it is a painful irony that when John Lewis finally made an entry into politics himself – in the shape of former managing director Andy Street – it was to seize the Birmingham mayoralty ahead of Labour's Sion Simon last year. (John Lewis the company remains apolitical.)

Another model attracting interest is Transport for London, currently controlled by Labour mayor Sadiq Khan. TfL may be a unique structure, but nevertheless trains feature heavily in the thinking of shadow ministers, whether Corbynista or soft left. They know that rail represents their best chance of quick nationalisation with public support, and have begun to spell out how it could be delivered.

Yes, the rhetoric is blunt, promising to take back control of our lines, but the plan is far more gradual. Rather than risk the cost and litigation of passing a law to cancel existing franchises, Labour would ask the Department for Transport to simply bring routes back in-house as each of the private sector deals expires over the next decade.

If Corbyn were to be a single-term prime minister, then a public-owned rail system would be one of the legacies he craves.

His scathing verdict on the health of privatised industries is well known but this month he put the case for the opposite when he addressed the Conference on Alternative Models of Ownership. Profits extracted from public services have been used to "line the pockets of shareholders" he declared. Services are better run when they are controlled by customers and workers, he added. "It is those people not share price speculators who are the real experts."

It is telling, however, that Labour's radical election manifesto did not mention nationalisation once. The phrase "public ownership" is used 10 times though. Perhaps it is a sign that while the leadership may have dumped New Labour "spin", it is not averse to softening its rhetoric when necessary.

So don't look to the past when considering what nationalisation and taking back control of public services might mean if Corbyn made it to Downing Street. The economic models of the 1970s are no more likely to make a comeback then the culinary trends for Blue Nun and creme brûlée.

Instead, if you want to know what public ownership might look like, then cast your gaze to Nottingham, Oldham and dozens more community companies around our country.

Peter Edwards was press secretary to a shadow chancellor, editor of LabourList and a parliamentary candidate in 2015 and 2017.