In the summer of 1942, at the height of the Second World War, in a country reeling from the trauma of Dunkirk and battered by the Blitz, noted economist William Beveridge put the finishing touches to his now-famous report. In its pages he set out a blueprint for a radical overhaul of the British state, one that would offer every citizen protection from the devastating social ills that gripped the society of his time. He wrote “a revolutionary moment in the world’s history is a time for revolutions, not for patching.”
The Moment We are In
Britain now faces another revolutionary moment but of a very different character. Beveridge’s work imagined the architecture of the welfare state. Today’s momentous task is that of fixing our economic fundamentals so that his creation might survive to the next generation. Under the last government our political and economic institutions became systemically incapable of meeting the basic demands of the British people; higher wages, bills that don’t spiral out of control, thriving & cohesive communities and public services which function when they need them. Since 2008 the real wages of a typical full-time worker have been flat and they have no more spending power than they would have had 16 years ago. Unaltered this path leads only to collapse. Public consent for the contract which underpins our democratic system is stretched to breaking point.
That contract is simple but profound. The people entrust their representatives with power so long as that power serves their interests and addresses their concerns. Yet, over many years, the political class ignored this pact. They placed party loyalty, special interests, or personal gain above those who put them in office. They ignored difficult realities while lending their ears only to the loudest, most organised voices in local or factional politics. They placed a higher premium on getting a headline in a newspaper than the exercise of power in service of the electorate. The majority were left silent until that silence became a roar of indignation.
One year ago, diagnosing this profound dysfunction, a group of Labour MPs came together with a shared recognition: that national renewal would demand disruption, honesty about the difficult trade-offs ahead and the courage to face them. In the last week of July 2024, we penned a letter to the Prime Minister committing to these values, to stand behind him and the Chancellor in pursuing them and restoring trust in government to look after British families’ finances. We announced that we had formed the Labour Growth Group.
The Roots of the Crisis
When Labour swept to power in July 2024, commentators excitably compared the result to the triumph of 1997. In truth, beyond the size of the majority, the two moments couldn’t have been more different. In 1997 Britain had a public-sector debt-to-GDP ratio of around 35%, when this Government took office, it was nearing 100 per cent.
Many in politics and the media had spent years pining for a return to the halcyon ‘normality’ of this era but it is precisely there that the seeds of the current crisis can be found. The fall of the Soviet Union pre-empted a period of elite overconfidence in globalisation, liberal capitalism and the primacy of technocratic consensus.
New Labour’s ‘Third Way’ was highly effective in taking advantage of the proceeds of this period to deliver hugely important progressive reforms like a national minimum wage. But underlying structural weaknesses in the economy simmered even as a booming City of London kept tax receipts high. The tectonic plates of political and economic dysfunction had begun, slowly but surely to drift toward one another.
The rupture occurred in 2008; the global financial crisis shook national economies to their core. Over-indexed on financial services and incredibly economically imbalanced. Britain was particularly exposed.
The Cameron government responded with austerity; an economic choice as foolish as it was cruel. Slashing an already faltering public sector when investment was desperately needed and credit was cheap. Gutting everything from towns across Britain but baseline services.
A decade of drift followed in which successive Tory governments doubled down on every external constraint to the economy imaginable. Quangos boomed as ministers merrily handed over democratic accountability for political decisions. MPs bemoaned levels of regulation and the size of the welfare bill while allowing both to balloon to record levels. Rock bottom wages were offered for essential work as the economy became utterly reliant on unsustainable levels of low-skilled migration.
This failure of politics deepened social fractures. The Brexit vote in 2016 was a warning from voters to political elites seemingly unable or unwilling to respond to the public’s pain. The immense economic cost of leaving didn’t however result in the British people “taking back control” but rather to power transferring from an unaccountable bureaucracy in Brussels to an equally dysfunctional one in Whitehall.
The Conservative Party presided over this disgraceful period of British history and has rightfully been relegated to a position of political irrelevance as a result. But we must be clear that the same fate will await the Labour Party if we do not create a radical break from their legacy of failure. The hangover of the wilderness years leaves us too ready to be defined by opposition: anti-cruelty, anti-chaos, anti-Tory. This is fighting the last war; we must pursue a politics shaped by addressing what matters here and now.
Our Vision: Strategic Disruption
The dysfunction gripping Britain is not an unavoidable tragedy. It stems from a clear political failure and a catastrophic absence of moral courage. Our founding principle is that decline is neither inevitable nor acceptable; Britain’s best days are ahead, but only if we choose purpose over complacency and disruption over caution. For too long politicians were content to accept the things they could not change, we instead set out to change those things which we cannot accept. We must smash the status quo.
We reject the exhausted politics of technocratic incrementalism and trickle-down ‘meritocracy’ that favours those privileged enough to start the game of life three-nil up. The belief that ‘grown-up’ management will be enough to right the ship of Britain’s institutions has not so much collided with reality as been obliterated by it. At the same time, we are in open conflict with populist nihilism, which diagnoses the failure of the current system but offers only embittered rage and dangerous fantasy in response. This is exemplified by the opportunism of Nigel Farage’s promise of up to £80 billion of unfunded tax cuts to disproportionately benefit the country’s highest earners.
We stake claim to the politics of strategic disruption, reforming ruthlessly yet with recognition of fiscal reality, and absolute clarity about the trade-offs involved. All measured by a single standard: does this serve to make the working people of Britain better off?
We put a strong economy at heart of our politics because it is a necessary condition to fund public services, reduce inequality and make all our constituents better off. Aneurin Bevan captured this truth: “Freedom is the by-product of economic surplus”. If the centre-left fails to deliver abundance, then it will fall to the radical right on the barren grounds of scarcity.
We stand proudly in a Labour tradition of radicalism that runs through Attlee’s creation of the welfare state, Crosland’s radical reshaping of left economics, and Bevan’s fearless assault on entrenched interests to establish the NHS. Labour Growth Group is not just another faction, it is a political and moral project to rebuild Britain’s broken systems in service of the many.
Tony Blair once described New Labour as the “political wing of the British people”. We take up that standard, not as insiders but insurgents relentlessly dedicated to placing the British people’s needs above politics as usual.
The National Renewal Compact: A Modern Beveridge Model to Rebuild Britain
Britain urgently requires a framework for national economic renewal as bold and transformative as Beveridge’s original vision was for welfare. Over the next year the Labour Growth Group will deliver our own comprehensive blueprint in the form of the National Renewal Compact, a set of accords underpinned by practical, costed plans to slay each of the giants holding Britain back.
Just as Beveridge confronted the ills of his era, we currently identify five modern giants strangling Britain’s economy and society:
● A Paralysed State: A machinery of government so risk‑averse and inward‑looking that it cannot confront hard choices or deliver lasting reform.
● A Nation Divided: A deeply imbalanced economy that concentrates wealth and opportunity in a few postcodes while vast regions are left behind.
● Building Banned: A planning and delivery system so clogged that Britain cannot build the homes, transport links, and infrastructure a modern economy demands.
● Enterprise Smothered: A regime of regulation and culture of hesitation that saps investment, dulls innovation, and turns ambition into retreat.
● Energy Constrained: A failure to secure abundant, affordable power—leaving households exposed, industry uncompetitive, and our future unprepared.
This will not be a dry review or an endless discussion exercise. It is a deliberate and provocative act in developing political economy involving leading policy organisations – the Centre for British Progress, Britain Remade and Labour Together among others – as well as thinkers from across the political spectrum. Our own members will bring to bear their expertise from business, energy, law, engineering, trade unionism, technology, economics and more. With their collective energy and experience we will refine our analysis.
We are clear that this government has made great strides to confront many of these problems, from the most radical reforms to the planning system in a generation to raising public investment to the highest level for over a decade, to removing barriers to building new nuclear reactors, to rolling back the dominance of quangos.
But the gravity of this moment demands an extra injection of radicalism. Each of these giants requires difficult, courageous trade-offs. Fixing our planning system, for example, means confronting entrenched interests resistant to housebuilding and infrastructure expansion. Addressing regional division requires tough choices on fiscal redistribution and decentralisation of power. We are clear-eyed that disruption is uncomfortable, but necessary. Britain has run out of easy options and an increasingly unstable world makes the future hard to plan for. That is why, in the words of the American technologist Alan Kay, we hold simply that “the best way to predict the future is to invent it”.
Our aim is practical, radical, and achievable proposals, not a wish list but a blueprint designed explicitly for implementation. This will not be another policy pamphlet shuffled around desks in Westminster, but instead a rallying point for all those who recognise the urgency of national renewal. It will serve not just as a call to action but as a binding compact, ensuring we do everything we can to see this Government deliver on its promise of transformation.
The Cost of Failure
Our fight is inherently political rather than technocratic. Regional rebalancing, for instance, is not simply about efficiency or even fairness. It is a democratic necessity. A country divided against itself, in which one region thrives while the potential of others is squandered, is a country that will fracture. The people have been patient, but their latitude has been tested to the limit and will not hold much longer.
If we as a party and as a government fail to come together now and reckon with this, then Nigel Farage as Prime Minister is what awaits. The Office for Budget Responsibility has recently warned that the country is effectively sitting atop a fiscal timebomb. Debt climbing constantly until it breaks 270 % of GDP by the 2070s while a collapse in long‑gilt demand could add £20 billion a year to interest bills and an ageing population doubles health spending from its current rate. A man peddling unfunded £80 billion tax giveaways in this environment is playing with matches in a tinder‑dry forest.
A chaotic Reform administration could well set it ablaze in short order, driving a severe fiscal crisis in the form of a debt interest spiral. The ramifications for the very fabric of British society of that final act of political betrayal should make blood run cold right across our movement.
The Call
One year ago, we committed to a simple but revolutionary conviction: Britain cannot afford another generation of timid politics and managed decline. In just twelve months, the Labour Growth Group has evolved from a name on a letter into a determined force of reformers in Parliament, united by the urgency of the moment and a clarity about the hard choices required.
Today, as we embark on the next phase of this project, in the form of the National Renewal Compact, we invite all who share our commitment to join us, from business leaders, civic organisations, unions, thinkers, and doers. We will work together to refine our analysis and reveal the answers the country needs.
This effort goes beyond party politics; it is about rebuilding Britain’s economy and salvaging her democracy. The hour is late, and there is no point in denying the scale of the challenge, but this country which we love has beaten greater odds before.
The British people sense another revolutionary moment at hand. Together, let us honour that, and forge a future worthy of them.
Chris Curtis MP: Co-Chair, Labour Growth Group
Lola McEvoy MP: Co-Chair, Labour Growth Group
Mark McVitie: Director, Labour Growth Group
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